Employer Unemployment Fraud

How's that again?

Here's how it works: your employer lays you off because "times are hard, business is down, we have to cut back". You go sign up to collect your unemployment insurance so you can pay some bills and feed your family until you find another job (or the benefits run out). But instead of a benefit check, you find a notice that your ex-employer is fighting your lay-off. According to him, you weren't laid off, you were fired for screwing up or you quit voluntarily. "Huh?" Yeah.

It's an unusual trick, mostly because in disputes the employer almost always loses a claim like that. Documentation is required - one, sometimes two written warnings in an employees' file, signed or initialed by the employee to prove s/he's seen them - that the employer either can't produce because it doesn't exist or has to forge and can't substantiate. But they are so desperate to save money and so sure they can get away with virtually anything after 8 years of Republican-style laissez-faire that more and more are trying it.

It's hard enough to lose a job. But for a growing proportion of U.S. workers, the troubles really set in when they apply for unemployment benefits.

More than a quarter of people applying for such claims have their rights to the benefit challenged as employers increasingly act to block payouts to former workers.

The proportion of claims disputed by former employers and state agencies has reached record levels in recent years, according to the Labor Department numbers tallied by the Urban Institute.

Under state and federal laws, employees who are fired for misbehavior or quit voluntarily are ineligible for unemployment compensation. When jobless claims are blocked, employers save money because their unemployment insurance rates are based on the amount of the benefits their workers collect.

As unemployment rolls swell in the recession, many workers seem surprised to find their benefits challenged, their former bosses providing testimony against them.

***

"In some of these cases, employers feel like there's some matter of principle involved," said Coleman Walsh, chief administrative law judge in Virginia, who has handled many such disputes. But, he said, "nowadays it appears their motivation has more to do with the impact on their unemployment insurance tax rate. Employers by and large are more aware of unemployment as a cost of business."

(emphasis added)

What they're counting on is that many of the people abused this way won't fight back, won't go through the potentially long, drawn-out process of defending their rights in hearings. It's the same numbers game that employers have been playing for years: the accountants say they will make more money (way more) if they don't buy safety equipment and train workers to use it than they will pay out in lawsuits when a certain percentage of workers are killed or injured because of that lack of training and equipment.

Bottom line: it's cheaper to bury a worker than protect him. In this case, it's cheaper to pay somebody to make false claims to the state unemployment investigators than to pay out massive amounts for unemployment insurance.

What they're doing is fraud, btw. It's illegal to forge documents, it's illegal to misrepresent the cause of dismissal to avoid paying higher rates.

Don't let them get away with putting you or your family in jeopardy to feed their greed. Fight. You'll almost certainly win. (Unless you live in a state still run by Republicans, in which case you're probably fucked.)

Comments

[jobseeker]

A lot of employees are learning the true character of their former employers and aren't about to forget what they've learned. After this unemployment crisis finally ends, there will be a schism between the workers and the owners that won't go away quickly.

[Mark Gisleson]

Nothing about this is new. Back in the '90s a local convenience store chain worked one of my clients half to death, forcing him to quit when he couldn't keep doing the 60+ hour weeks for a $450/week manager's salary. They fought his unemployment claim and I was so offended I volunteered to represent him at the hearing.

What I got was an East Indian Job Service officer (the only one they had, Indian-Americans not being common among the ranks of Minnesota state employees). The employer's side had no case, made mistakes and, when they were done they had failed to meet a single standard for denying a claim.

I pointed that out and rested my case. Later the hearing officer found in favor of the corporation, a decision easily reversed but only after months passed and my desperate-for-income client had been forced to take a clerk's job at another chain.

Under a series of Republican governors (incl Jesse Ventura) the Job Service was totally gamed, and any employer who objected to paying a claim almost always won the initial hearing, no matter how lame the employer's case.

This is standard procedure in America, and no, this is NOT something new.

[mick]

No, the tactic isn't new, it's just that the numbers of workers the tactic is used against is growing exponentially. Where most employers were content at one time to follow the law and lay people off when they didn't have work for them, now they're finding excuses for firing many more and then fighting every claim.

Something to look forward to.

[Mark Gisleson]

Same as it's ever been. American employers despise their workers, and spend their time dreaming about the Big Rock Candyland profits they'd have if only labor weren't so greedy.

[mick]

"Greedy", of course, being translated as: "demanding pay for work when they should be happy to work for nothing". I can no longer count the number of employers who have snapped at me at one time or another that it was a privilege for me to work for them and if I had any gratitude I'd work for free.

As if.

But many of them actually believe that shit. American employers' template is the kind of Third World employers who can - and do - call out the Army Death Squads when their workers don't do what they're told - and for starvation wages. They all sigh with longing whenever anybody brings up Sri Lanka or Columbia.

[Christopher King]

I like your style.

I was an unemployment attorney for the Ohio AG's office.

Enjoy my blog as well.

[Tom]

Unreal. That is America for you. Rip off, squeeze the lemon dry from your slaves and then screw em when they need help (UI) to pay their food, utilities, gas etc... what a bunch of scum-employers.

[Tim Gibson]

This happened to me. My former employer appealed my unemployment and was denied twice. I then had to go to a hearing where he lied produced false documents. He is also an attorney (I worked for his families side business) he won at the hearing. At the hearing they dismissed anything I said and took my former employers side. He never wrote me up or gave me a bad review. He said at the hearing that he gave me a verbal warning (which he did not) and they believed him when he showed no proof.
I have appealed and am waiting for the response. But I am on the verge of losing my apt, having to give up my dog. I am 40 can't find a job and have no money.
I worked very hard for that man. I did nothing wrong and am set to lose everything. It rips apart your self esteem when you want to work, are a good worker. And at 40 I might have to go live with my parents or on the street.
I am so angry, and hurt and frustrated.

[mick]

It probably won't make you feel any better, Tim, but there are millions in the same boat. That's what you get when you elect corporate-friendly pols because they offer pie in the sky and then eliminate worker protections to make their corporate sponsors happy. Works every time.

[Cali]

Not all of it is unreal. Some people lie, steal and cheat from employers making it hard on the rest of us. How many people abuse FMLA by being sick only On Mondays& Fridays? How many people give friends & family free stuff just because. How many people steal from their employer and sell the stuff on EBAY? Come on some people deserve to be denied while some other do not.

[Tim]

Just wanted to let you know that my appeal went to the state level...and I won. The appeal board said that my former employer's evidence was inconsistent, and so the reversed the decision of the administrative law judge. I can not begin to tell you how relieved I am. The night that I was notified of my win, was honestly the first time that I have slept through the night in about 4 months. I wonder if people really understand what a toll this kind of crap takes out of people. I guess they really don't care.....

[Ulanda]

What a bunch or whiners. Not that an employer who falsifies information shouldn't be held accountable... but the majority of comments here are all about "the man" and "corporate" - of course if it were you who were the employer, you wouldn't be like that, you're nice. What a bunch of judgmental, misinformed hypocrites.

[mick]

Of course we are, Ulanda. Anyone who claims they wouldn't screw their employees first chance they got is clearly lying through their teeth because as we all know, no one who becomes an employer ever has an ounce of ethics or obeys any law that would prevent him/her from increasing his/her profit. That's just common sense, right?

Except...I owned a successful business for 5 years, had a dozen employees, and didn't do this to any of them. What a hypocrite, eh?