Why Defend Unemployment Claims?

There are two main reasons why you should care about whether your ex-workers are collecting unemployment, and why you should try to prevent an improper claim from being paid.

• You'll want to keep your tax rates as low as possible. Your state unemployment tax rate is directly affected by the number of your ex-employees who collected unemployment after leaving your business.
• If there's a chance that the worker is going to sue you for discrimination or wrongful discharge, you can discourage the lawsuit. If that doesn't work and a lawsuit is filed, you may increase your chances of winning. A disgruntled worker's first contact with the legal system is usually in the unemployment setting. If you win in this arena, you're more likely to win in a later suit for wrongful termination, where the stakes may be much higher. On the other hand, if you lose in the unemployment matter, you may decide that the facts are not in your favor and that you should settle with the worker rather than going to trial in the other lawsuit.