The world of unemployment insurance claims and benefits is at the very least unique. Past employees often times are eligible for benefits when common sense might think they are not. And then sometimes the system gets it right – at least in the feel-good department.
Many state unemployment laws now specify that no disqualification will be imposed when an employee separates because of domestic violence. The rules from state to state vary – of course – but for the most part there is polarity on this subject.
According to Thomas & Thorngren, this disqualification rule is recently new and an outcome of the Great Recession:
The groundswell of UI legislation relating to domestic violence can be traced to the American Recovery and Reinvestment Act of 2009 (P.L. 111-5, also known as ARRA). This was a wide-ranging bill that provided monetary incentives to state governments to approve claims in an expanded list of situations. For unemployed individuals, 2009 was a difficult time, as jobs were being eliminated and a high percentage of claimants were exhausting their UI benefits before they could find new jobs. At that time, expanding eligibility for UI benefits was seen as an important strategy for stabilizing the economy.
In general, state unemployment insurance laws provide that an employer’s unemployment insurance tax account is relieved from direct charges when the claim is approved because of the result of domestic violence. That payment doesn’t affect the employer’s unemployment insurance tax rate either – at least not directly. Indirectly, any unemployment insurance benefits paid in this situation affects the state unemployment insurance trust fund balance and thereby impacts the unemployment insurance tax rates for all employers in the state collectively by means of upward adjustments to tax rate tables or statewide adjustment factors.
Organizations are stressed to review their own state rules if this situation ever occurs.
As always, if there are any questions about unemployment insurance taxes and claims, please don’t hesitate to give us a call. We are here to help.
