Unemployment Insurance (UI) taxes are a necessary cost of doing business. You can play an active role in controlling these costs by understanding the factors that may increase or decrease this tax liability.
Below are some easy steps you can take.
When a former employee files for UI benefits, you have the opportunity to supply information to DEW about the reason the individual is now unemployed.
To prevent improper payments, you must respond to the department within 10 calendar days of receiving the notification. Failure to respond may result in increased benefit charges and higher UI taxes.
You can respond to a separation request online via the SC Business One Stop or the State Information Data Exchange System or by paper.
Respond Adequately and Effectively
If a former employee was terminated, the information you provide to DEW should include:
• Names and titles of individuals involved;
• Description of the final incident that led to the termination including the date and time;
• List of all warnings given to the employee within the last year including dates; and
• Statement of how the employee’s actions impacted the company’s operation.
Statements should be factually objective statements rather than subjective. For examples of good responses, visit this page.
Understand Eligibility Requirements
Claimants are entitled to benefits when they are unemployed through no fault of their own.
• Lack of work
• Reduction in hours
• Discharged for reasons other than cause and misconduct
• Quitting for good cause in connection with employment
• Substandard performance beyond the control of the claimant
A claimant is not eligible for UI benefits if discharged for misconduct. For the definition of misconduct and cause, visit this page.
Implement Clear Employee Policies and Keep Records
If you discharge an employee , it’s important to produce sufficient evidence of fault or misconduct on the part of the claimant.
To prove fault and misconduct, a business needs to maintain clearly documented and communicated employee policies. It may be beneficial to also keep records of employee orientations, training, evaluations, warnings, and disciplinary actions.
Understand the Appeals Process
Both claimants and businesses have the right to appeal UI determinations. Not participating in an appeal could adversely impact your taxes. Here is what you should know about the DEW appeals process:
• Appeals must be filed within 10 days of the determination’s mailing date.
• Hearings can be scheduled via telephone for scheduling flexibility.
• Firsthand testimony is needed to explain why the employee was separated.
• Appeals from hearing officer decisions go to the agency’s Appellate Panel.
• Appellate Panel decisions can be appealed to the Administrative Law Court.
It is vital that business owners respond to appeals filed by their former employees – or if they disagree with a determination to award benefits, to file an appeal themselves.
Being involved in the appeals process ensures the integrity of the UI benefits system, prevents overpayments, keeps taxes low and results in accurate charging to employer accounts.
For more information, visit www.dew.sc.gov/appeals.