UNEMPLOYMENT COMPENSATION AND THE APPEALS PROCESS

Elsa G. Ramos Legal Counsel to Hope Andrade

Commissioner Representing Employers

1-800-832-9394 1-512-463-2826

UI BASICS

• All 50 states

• Based on fault, not need

• Financed entirely by employers

• Covers most employees

• Covers most employers

REMEDIAL PROGRAM

• Construed liberally in favor of its intended beneficiaries

• Benefit of the doubt generally goes to the claimant

• Based on principles of fairness and due process

TAXABLE WAGE BASE

• The first $9000 - subject to the state UI tax in Texas

• The first $7000 - subject to the federal UI tax

WHY TWO TAXES?

• State tax goes into UI fund - pays for benefits

• Federal tax is taken by DOL and allocated to 50 states – pays for administration of system

WHO CAN FILE FOR BENEFITS?

• Anyone no longer performing services for pay

• Includes full-time, part-time, temporary, PRN/as-needed, people on the job less than 90 days

• Whether fired or quit

Unemployment Compensation is Insurance

Unemployment

Insurance Compensation

CHARGEBACK LIABILITY

• Employers not sent a bill

• Benefits “charged back” to an employer’s tax account will be used in computing the employer’s UI tax rate for the next year

Tax Rate Can Increase

Tax rate

BASE PERIOD

• Period of one year

• Measured from the date of initial claims, not the date of separation

• Defined as the first four of the last five completed calendar quarters prior to the date of the initial claim

BASE PERIOD - 2

BASE PERIOD - 3

BASE PERIOD - 4

FULL YEAR OF BASE PERIODS (FORMS: Pg. 1)

WHY BASE PERIOD IS IMPORTANT

• For employers – determines who will have potential financial liability for benefits paid to the claimant

• If reported earnings - have potential financial involvement

• If did not report earnings – no financial liability

WHY BASE PERIOD IS IMPORTANT - 2

• For claimants – determines if sufficient wage credits for monetary eligibility

–(37 times the WBA)

• Used to determine the weekly benefit amount (WBA)

BENEFIT AMOUNT

• Take the calendar quarter in the base period with the highest earnings and divide by 25

• Minimum = $63 / week

• Maximum = $454 / week

CLAIMANT REQUIREMENTS

• Monetary eligibility

• Qualification for benefits: based on the reason for the separation

• Continuing eligibility requirements, (e.g., able and available, I-9)

QUALIFICATION FOR BENEFITS

• Based on the reason for the job separation

• Claimant must be out of work through no fault of his/her own

WHAT CONSTITUTES FAULT?

• If voluntarily left the last job “without good cause connected with the work,” the claimant is disqualified

• If discharged for “misconduct connected with the work,” the claimant is disqualified

IMPORTANCE OF QUALIFICATION

• Nature of the separation will determine if the employer bears any financial liability for benefits

• General Rule:

Qualification = Charge

No qualification = No charge

EXCEPTION TO THE RULE

• Medical separation: If the job separation was caused by the medically verifiable illness of the claimant or the claimant’s minor child, the employer’s account may not be charged for benefits paid to the claimant.

TYPES OF WORK SEPARATIONS

• Fired or quit?

• If initiated by claimant = voluntary work separation

• If initiated by employer = involuntary work separation

VOLUNTARY SEPARATIONS

• Resignation/Quitting

• Walking off the job

• Job abandonment

• Retirement

VOLUNTARY SEPARATIONS - 2

• Unpaid suspension of 3 days or less

• Early acceptance of resignation if within two-week notice period

INVOLUNTARY SEPARATIONS

• Layoff

• Reduction in force

• Discharge/Termination/Firing

• Mutual agreement

INVOLUNTARY SEPARATIONS - 2

• Resignation in lieu of discharge

• Unpaid suspension of more than 3 days

• Early acceptance of resignation outside of two week notice period

TEMPORARY OR PRN

• There’s a job separation at the end of each assignment

• The claimant may file a UI claim at that time

• If claimant not offered further work at the end of assignment, considered a layoff

BURDEN OF PROOF

• If claimant quits, claimant must prove “good cause connected with the work”

• If claimant discharged, employer must prove “misconduct connected with the work”

GOOD CAUSE CONNECTED WITH THE WORK

• Such cause, related to the work, as would induce a person who is genuinely interested in retaining work, to, nevertheless, leave the job.

MISCONDUCT CONNECTED WITH THE WORK

• Mismanagement of a position of employment by action or inaction,

MISCONDUCT CONNECTED WITH THE WORK - 2

• Mismanagement of a position of employment by action or inaction, neglect that jeopardizes the life or property of another,

MISCONDUCT CONNECTED WITH THE WORK - 3

• Mismanagement of a position of employment by action or inaction, neglect that jeopardizes the life or property of another, intentional wrongdoing or malfeasance,

MISCONDUCT CONNECTED WITH THE WORK - 4

• Mismanagement of a position of employment by action or inaction, neglect that jeopardizes the life or property of another, intentional wrongdoing or malfeasance, intentional violation of law,

MISCONDUCT CONNECTED WITH THE WORK - 5

• Mismanagement of a position of employment by action or inaction, neglect that jeopardizes the life or property of another, intentional wrongdoing or malfeasance, intentional violation of law, or violation of a policy or rule adopted to ensure the orderly work and safety of employees.

Only misconduct will disqualify a claimant

In case of a discharge, only misconduct will disqualify a claimant.

WHAT EMPLOYER SHOULD SHOW

• Voluntary separation/quit – show that a reasonable employee would not have quit for that reason

IF CLAIMANT QUIT

• Address any legitimate complaints

• Investigate as necessary

• Take all reasonable and appropriate steps to remedy the problem

Get it in writing …

“If it’s not written down, it didn’t happen.”

WHAT EMPLOYER SHOULD SHOW - 2

• Involuntary separation/discharge – show the separation resulted from

• 1) misconduct that

• 2) happened close in time to

discharge and

• 3) that claimant knew or should have known he could be discharged for that reason

IF CLAIMANT WAS FIRED

• Clear policies in place

• Claimant was aware of policies

• Employees treated consistently

• Warnings resulted from violations

• Expectations and consequences

• Claimant knew job was in jeopardy

MINIMIZING RISK OF UI CLAIMS

• Golden Rule – treat employees fairly and consistently according to known rules

• Discharge should be last resort

• Use counseling, training, and mentoring

• Listen to employees and act on valid complaints

UI CLAIMS FILING PROCESS

• After job separation, Claimant contacts TWC

• Claimant lists his/her last employer

• TWC sends Notice of Claim

• Employer has opportunity to protest benefit payments and/or chargeback

NOTICE OF INITIAL CLAIM (FORMS: Pg. 2 - 3)

RESPONDING TO NOTICE OF IC (Pg. 2 – A & B)

EMPLOYER RESPONSE

• Due 14 days from the date of mailing

• Via mail, fax, Internet, or phone

• Submit documentation

• If late response, employer loses appeal rights

ADEQUATE RESPONSE

• Notification is adequate as long as the employer or its agent gives a reason, supported by facts, directly related to the allegations raised regarding the claimant’s right to benefits

• Not adequate if it provides only general conclusion without substantiating facts, eg. C discharged for misconduct connected with the work

CONSEQUENCES

• If employer at fault for failing to respond timely or adequately to request for information for a claim that was subsequently overpaid, and

• has established a pattern of failing to respond timely or adequately, then

• employer’s account will not be protected from chargeback

TWC INVESTIGATION

• Claims Investigator will contact parties by phone for more details

• Determination will be issued with a ruling about the claimant’s qualification and the employer’s chargeback/financial liability

• Determination will be made with available information

INITIAL DETERMINATION (FORMS: Pg. 4 - 5)

INITIAL DETERMINATION

• Whether claimant is qualified for benefits (A)

• Whether the employer’s account will be charged (B)

• Appeal deadline (C)

APPEAL DEADLINE (Pg. 4 – C)

APPEALS PROCESS

• File an appeal by deadline – 14 days from date of mailing

• Appeal via fax, mail, or online

• If fax appeal – keep copy of confirmation

• Include supporting documentation

• No magic words necessary

• Filing a late appeal can be deadly

WHO MAY APPEAL

• Any party with a non-favorable determination

• Even if obvious misconduct, claimants are given the benefit of the appeal process

• Even in cases of layoff due to economic downturn, employers are given the benefit of the appeal process

APPEAL TRIBUNAL HEARING

• Telephone hearing will be scheduled

• Hearing Officer presides at hearing

• Parties provide witnesses and documents

• Attorneys not needed; parties can represent themselves

• Use best evidence

NOTICE OF HEARING PACKET

• Date and time of hearing

• Issues to be covered

• Any claim protests

• Information received by TWC in response to a claim

• Fact-finding statements

• Appeal letters or forms

NOTICE OF HEARING PACKET - 2

• Date and time of hearing

• Issues to be covered

• Any claim protests

• Information received by TWC in response to a claim

• Fact-finding statements

• Appeal letters or forms

NOTICE OF HEARING (FORMS: Pg. 6)

NOTICE OF HEARING – FIRST PAGE

• Date and time of hearing

• Phone number or website for making party available for hearing - at least 30 minutes before hearing time

• Include callback and witness information

• Instructions for documents • Name and number of hearing officer

NOTICE OF HEARING

ISSUES IN THE HEARING (FORMS: Pg. 7)

DOCUMENTS

• Ensure that hearing packet includes relevant documents previously submitted

• If not, send them to hearing officer and the claimant prior to hearing

• Make sure that your documents are admitted into the record

WITNESSES

• Firsthand witnesses

–who saw or heard what happened

–present at final incident

• Secondhand hearsay evidence is not given the same weight

–Written statements

FACT-FINDING STATEMENTS (FORMS: Pg. 8 – 10)

FACT-FINDING STATEMENTS

• Taken at time of investigation

• Not taken under oath

• Review these carefully

• Be ready to point out inaccuracies or inconsistencies

REST OF THE PACKET

• Contains documents submitted by parties, including appeals

• Read and become familiar with them

• Make notes of discrepancies

THIS IS YOUR CASE

• Include all relevant / best evidence

• Make sure all relevant documents were admitted as exhibits

• Make sure witnesses presented all relevant testimony

• Even if Hearing Officer did not ask all the right questions, this is your story - make sure you tell it

APPEAL TRIBUNAL DECISION

• After hearing, the hearing officer will issue a written decision

• Appealable by either party

• Appeal deadline is 14 days from the date of mailing

• Appeal via fax, mail, or online

APPEAL TO THE COMMISSION

• Does not result in another hearing – not a second bite at the apple

• Evidence submitted at AT hearing – testimony and documents – is reviewed

• Commissioners vote on merits and issue a decision

• Majority rules: 2 out of 3

DATES MATTER

DUCKS IN A ROW!

HAND OVER THE KEYS

BE APPEALING!

PEOPLE - NOT PAPER

NO SHORTCUTS

Responding to a claim and participating in the appeal process takes time

CALL US - WE CAN HELP

Office of Commissioner Hope Andrade

Commissioner Representing Employers

1-800-832-9394

1-512-463-2826

Thank you!