6 Tips to Control Your Unemployment Insurance Costs

Old photo of many people standing in line, in front of a building. Title - Tips for Controlling Unemployment Costs

Has your business recently seen an increase in unemployment insurance taxes? You’re not alone. The good news is there are some steps you can take as a savvy business owner that will help your company control unemployment insurance costs.

Sometimes unemployment benefits are necessary. When an employee loses their job through no fault of their own, unemployment insurance can help them stay afloat until they find other employment. So maybe the problem isn’t in the cost of the insurance, but the rate at which it is being used? Here are a few tips you can use to decrease the likelihood that unemployment insurance will be needed.

1.Hire Smart

Don’t jump into interviews unprepared and don’t let just anyone do the interviewing. Hiring smart means you take the necessary steps to avoid making a bad hire, and paying the consequences. When you hire smart, you’ll decrease your  The best advice I can give you is to take your time. Never hire in a hurry. Here are a few articles to get you set in the right direction, be sure to check out the Interview Questions for Employers eBook too.

3 Common Hiring Mistakes and How to Avoid Them

How to Write Amazing Job Descriptions

Master the Pre-Interview Screens

3 Signs You Lost the Best Candidate for the Job

Interview Questions for Employers

2. Be Consistent with Your Performance Reviews

Performance reviews are an opportunity to learn and grow. Don’t steal that from any of your employees. From the first day on board, every employee should be aware of their specific expectations and what repercussions may incur if they aren’t meeting those expectations. If an employee has to be let-go make sure you have given them adequate warnings and they are provided the time and resources necessary to improve their performance. Read these articles to improve your performance reviews

Making Performance Reviews a Positive Experience

3. Train Properly

To avoid future problems, be sure to train your employees properly. Safety, anti-discrimination, and workplace behaviors should all be covered at the beginning of employment. To help with this, make sure you have an effective safety training program and a thorough employee handbook. See this articles to help train new employees.

Onboarding Documents New Hires Need

Why New Hire Safety Orientation Programs are Important

Why Every Employer Should Have an Employee Handbook

Does Your Safety Handbook Cover all Bases?

4. Have Consistent Discipline Procedures

Your business should have a strict disciplinary action policy that all leaders follow. Even in the event of a verbal warning or one-on-one meeting, everything should be documented. Including date, time, people involved, and anything that was discussed including comments. Deal with the disciplinary procedure before you have to use it. Here is an article on how to set up an effective discipline plan and check out our other helpful articles.

7 Tips for Documenting Employee Discipline

One Angry Employee, Two Very Different Outcomes

5. Follow Consistent Termination Policies

Ultimately, if you have to resort to termination, document everything. You should already have documentation of the warnings and disciplinary actions that took place leading up to termination. Since you have been consistent with your performance reviews, the employee should not be surprised of the termination. Even so, don’t miss any steps. Provide the employee notice of the termination as soon as possible. Some states have different laws stating when an employee must be notified and when they must be paid out any remaining compensation. You should also consider an exit interview.

5 Tips to Getting the Most out of an Exit Interview

6. Promptly Respond to Requests for Information

If there is a claim for unemployment benefits, provide all necessary documentation and information right away. Don’t leave them hanging, they will be granted benefits in the meantime and you’ll have to stir up a whole kind of mess to try and get them repaid. Promptly doing your part in the situation is your best shot at a fair outcome. If the employee was terminated, provide documentation proving warnings and time/resources provided in an attempt to rectify behavior. However, if the separation was voluntary, provide the unemployment agency the employee’s’ letter of resignation and documentation of the exit interview.

Generally, if an employee quits their job, they are not eligible for unemployment benefits. However, “he said, she said” type situations can happen. If you can’t provide proof showing the employee did leave voluntarily, they will likely be granted benefits. So, getting a resignation notice or letter and keeping any text or email messages regarding the separation is important.

We hope this article was useful and helps your business avoid paying any unnecessary unemployment benefits in the future. For more articles like this one, subscribe to our newsletter below.


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