Adequate Response: Are Employers Set Up To Fail?
A common dictionary definition is as follows: ad·e·quate – adjective \ˈa-di-kwət\: enough for some need or requirement; good enough; of a quality that is good or acceptable; of a quality that is acceptable but not better than acceptable.
Unfortunately, section 252 of the Trade Adjustment Assistance Extension Act of 2011 (a.k.a. the federal UI Integrity law) doesn’t really define “adequate response.” Guidance from the USDOL to state unemployment agencies in the matter of unemployment claims response is as follows: “In determining the adequacy of responses to requests for information, states must determine whether the employer’s or agent’s response provides sufficient facts to enable them to make the correct determination under its law. A lack of receipt of a response would certainly result in the state not having adequate information; failure to respond would also constitute an inadequate response. However, a response may not be considered inadequate if the state agency failed to ask for all necessary information.”
The challenge is that there is a significant degree of subjectivity in this definition. Even the states have difficulty in pinning down a clear interpretation of “adequate response,” as indicated by the following sampling:
Arkansas – “Adequately” means the employer or the employer’s agent substantially and accurately completed the Department of Workforce Services forms with sufficient factual information necessary to render an accurate determination of eligibility for unemployment insurance benefits.
Massachusetts – In order for a response to be considered adequate the agency must be able to issue a determination on eligibility without further clarification from the employer. This means all the information the employer has or can obtain must be provided on fact-finding questionnaires; answers must include all details and any documentation pertaining to the issue presented.
North Carolina – In short, an “adequate” response provide sufficient facts to enable DES to make a correct determination under the law without having to contact the employer to obtain any additional information.
Ohio – A response is considered “adequate” if an employer or third-party administrator answers all questions on this form or participates in a fact-finding interview, if requested.
Texas – Notification to the Commission is adequate as long as the employer or its agent gives a reason, supported by facts, directly related to the allegation raised regarding the claimant’s right to benefits.
The ambiguity of the federal guidance, combined with the subjectivity of state interpretations, could be setting employers up to fail in providing timely and adequate separation information. This, in turn, could lead to the establishment of patterns of failure, ultimately leading to consequences such as loss of UI benefit non-charging, loss of party status and appeal rights, and the assessment of monetary penalties.
Strategies for “Adequate” Response
While reasonably concise, the answers you provide in response to an unemployment claim should not only be detailed, but contain all necessary supporting documentation. A great way to think of this is in relation to how we file our personal income taxes each year. We complete various 1040 Forms and Schedules, and then attach receipts and documentation to support the figures provided on the form. We do not, however, simply include a stack of receipts with the blank forms and expect the IRS to figure it out. Unemployment is no different. States do not want a vague statement such as “The claimant violated company policy” along with various pages of warning, policy, and statements attached. This manner of response would have a high risk of being deemed inadequate and, as a result, subject to the aforementioned penalties.
Adequate response information typically includes such items as the date of hire, last physical date of employment, and termination date (if different from the last physical date). For quit issues, additional response should include:
- A copy of a resignation letter
- Information surrounding the measures taken by the claimant to preserve employment (such as a leave of absence or transfer)
- Whether or not notice was given and worked out
For discharge issues, you will need:
- A copy of the company policy violated
- A signed acknowledgement (if available)
- Warnings relevant to the reason for discharge
Depending on the specific reason for discharge, you way also want to include pictures, witness statements, drug test results, confessions, restitution notices, any falsified documents, and police reports, just to name a few. A good rule of thumb is to assume the claimant is going to deny everything – so think about what you need to rebut that denial.
Finally, don’t forget to provide detailed information surrounding any terminal pay issued such as vacation or severance pay. It is critical to provide not just the gross dollar amount, but when it was paid, if the pay was allocated, and dates of allocation.
To keep our clients up to date on the latest guidance on “Adequate Response,” Equifax Workforce Solutions will continue to monitor state UI Integrity legislation, and continually canvass unemployment agencies for additional administrative direction. Please check back to this blog for additional updates on this timely matter!