UI Forum (ADP Unemployment Group)

Third Quarter 2013

Written Warnings: A Key UI Integrity Component

Written warnings are a common, yet important component of a company’s employment disciplinary policy. A warning, and any corrective action stemming from it, helps both the worker and the employer when effectively administered. For the employee, a written warning can clearly outline the details of the incident, how the worker violated company policy and what the employer expects in terms of the individual changing his or her behavior or actions, in order to help prevent similar incidents from occurring in the future. If the desired change doesn’t occur and the worker is ultimately terminated and files an unemployment insurance (UI) claim, those written warnings become detailed documentation that the employer can provide to the state UI agency, which helps UI integrity efforts.

State UI agencies have become increasingly demanding of employers and their agents to provide complete and accurate separation information at the claim level in order to help the agencies make a correct decision and avoid improper UI benefit payments. Reducing improper payments is an initiative known as UI integrity. More and more states are amending their UI laws to prohibit relief of charges to an employer’s unemployment tax accounts if employers or their agents are at fault for failing to adequately and/or timely respond to the state agency’s request for detailed information relating to the claim for unemployment compensation. Written warnings can be a key component in helping you meet a state’s UI integrity law requirements. They can also help you prevail in the unemployment claim and help avoid benefit charge costs to your unemployment account.

Human resource best practices for administering an effective written warning include preparing an objective, factual summary of the incident, instead of expressing judgments or opinions. Terms such as “poor performance” should generally be avoided, particularly if you are meaning to describe willful misconduct or deliberate violations of policy within the employee’s control. The written warning should include “acknowledgement” signatures of the employee and the manager administering the warning, as well as the signature of any witnessing manager, if such an individual is present at the time the warning is given. According to human resource professionals, the three essential parts of a written warning are:

  • The Violation: Write a detailed summary of the event or the behavior observed, explain why it was unacceptable and indicate which policy was violated. Include all applicable facts, dates, times and witnesses.
  • Expectations for Change: Outline all expected future behavior and/or disciplinary action steps.
  • Consequences: Specify a time frame for expected improvement, i.e., 30 days, 60 days etc., and the next steps to be taken if expectations are not met, especially if it may include termination.

Some additional “best practices” for administering written warnings that may be beneficial in UI claim matters include:

  • All warnings, even verbal, should be documented.
  • Disciplinary action must be in accordance with your company policy.
  • Disciplinary actions should be timely administered and by authorized staff.
  • Consistent enforcement of rules and policies is critical.
  • Retain copies of “employee acknowledgements of receipt” of company policies or employee handbooks (including changes).
  • Documentation should be kept readily accessible for at least 18 months, in order to provide timely, complete responses to UI agency requests.

By consistently providing detailed and accurate information, along with supporting written warnings, your ADP Unemployment Group representative can help you be UI Integrity compliant, help increase your chances of prevailing in the unemployment claim, and help you obtain relief of charges to your unemployment tax accounts.

Sequestration: What It Means for the Unemployment Insurance Program

Sequestration is a term referring to automatic cuts to federal and state budgets that became effective as of March 1, 2013. Budgets must be reduced by a total of $85.3 billion for FY 2013.

In 2011, an agreement was made to allow the national debt ceiling to be raised without any budget cuts, on the condition that if Congress and the Administration did not come to a new agreement by 2013, then budget cuts would automatically be triggered. An agreement was not timely reached, so the spending cuts became effective.

The Unemployment Insurance Program is one of many federal and state programs impacted by sequestration. The U.S. Department of Labor issued guidance to the state UI agencies, in the form of an Unemployment Insurance Program Letter (UIPL No. 13-13) on how to apply sequestration so that the state UI agencies can make necessary changes to their operations. The UIPL points out that while the reduction percentage is 5.0 or 5.1% (depending on the program, project or activity), sequestration must cover fiscal year 2013, and with the fiscal year more than half over, the actual percentages will likely be higher, in order for the state agencies to achieve the full required reduction.

State UI agencies and claimants are the two groups immediately and most directly impacted.

  • UI Agencies
    • Administrative funding is reduced
    • Funding of Emergency Unemployment Compensation (EUC)
    • Federal funding of state Extended Benefits (EB)
    • Federal reimbursement of Short Time Compensation (STC a.k.a. Work Share)
    • Reprogramming and other operational changes
    • State agencies are to notify claimants of the reductions to their EUC benefits
  • Claimants
    • Emergency Unemployment Compensation (EUC) benefits will be reduced

Based on the USDOL guidance in UIPL No. 13-13, states could select one of four program change implementation date options, with corresponding reduction percentages: 1) March 31st – 10.7%; 2) April 28th - 12.8%; 3) June 2nd – 16.8%; or 4) June 30th – 22.2%.

The impact of sequestration on employers is more indirect, especially in the initial weeks and months following the implementation of sequestration.

  • Employers
    • Possible calls from workers frustrated by EUC benefit check reductions
    • Possible charges for state Extended Benefits (EB). (Under normal state EB laws, states may pass the cost of their share of EB on to employers, but no state is currently paying EB.)

We will continue to monitor the news about sequestration and report on any pertinent information as we become aware of it.

State Updates

The Department of Employment, Training and Rehabilitation, Employment Security Division (ESD) recently issued a letter to employers about their change in banking services from Bank of America to Wells Fargo, as of April 1, 2013. The letter outlines action steps that employers should take if they submit their Unemployment Insurance (UI) payments utilizing ACH Credit. Details, including a copy of the letter can be found at: https://uitax.nvdetr.org/crphtml/whats_new.htm or https://uitax.nvdetr.org/crppdf/Wells_Fargo.pdf

ADP has taken the necessary steps associate with this change to help ensure seamless services to its clients.

The Pennsylvania Department of Labor & Industry recently announced it will implement a tax amnesty program this year to assist employers who may have underreported and/or underpaid tax liabilities to the agency. The program will call for a 50% reduction in interest and penalties for contributing and reimbursing employers. The reductions in penalties and interest will apply to outstanding unemployment insurance tax liabilities occurring on or before the 1st quarter of fiscal year 2012. For reimbursing employers, interest and penalties will be reduced for reimbursable amounts due on or before April 30, 2012.

In addition to outstanding liabilities, for employers who failed to file quarterly tax returns, or who may have made payments to independent contractors that should have been classified as employees, the reduction of interest and penalties will also apply if those payments were due on or before April 30, 2012.

In order to take advantage of the interest and penalty reductions, payments of related taxes must be made to the Department between June 1, 2013 and August 31, 2013. Additional details about the amnesty program may be obtained by calling 855-832-1169 or at http://www.dli.state.pa.us/portal/server.pt/community/l_i_home/5278.

The Department of Workforce Services (DWS) is warning employers and claimants of a fraudulent website bearing the name of the DWS Unemployment Insurance Division. This is a phishing scam and the agency is working with state law enforcement to shut down the site.

Phishing is a scam used to attempt to fraudulently collect personal information via the Internet and/or other electronic means.

Any questions about the validity of a website, web-link or email can be directed to the DWS at 307-777-6011. The agency’s official website address is www.wyomingworkforce.org.

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