How to challenge an unemployment claim

Workers are eligible to receive unemployment benefits if they have become unemployed through no fault of their own and meet any other requirements of state law.

But former employees aren’t eligible for unemployment benefits if they:

  • Quit voluntarily without good cause
  • Quit voluntarily for a better job
  • Quit voluntarily to attend approved training
  • Were fired for gross misconduct.

As the employer, you will receive notice when a former employee is determined to be eligible for benefits. You then have the right to appeal the decision. You typically have a very tight deadline to file the appeal, so watch for eligibility determinations in the mail and respond to them immediately.

Employers should carefully consider whether they want to contest an unemployment claim and, ideally, consult an employment law expert about the best course of action. This is true especially if you suspect the employee might file a discrimination lawsuit against your company. What you say about your organization’s actions can come back to haunt you, especially if the former employee’s attorney is using the relatively low-stakes unemployment setting to fish for information for a later lawsuit against you. What you say about why an employee was fired may bind you in a later, high-stakes lawsuit.

For example, if you testify that you fired an employee because of her frequent absences, the records you produce about it can be used later to show you violated the FMLA when you counted a sick-child call-off as an unexcused absence.

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That’s why it’s best to run your expected testimony and documentary evidence by an attorney before you represent your employer in a hearing. You don’t want to say something now that will be used against you later, or be silent about something now that will prevent you from putting on evidence later.

Sometimes, it may be best to have an attorney handle the entire UI case. Other times, if you and your attorney think there’s a good chance that the former employee will file a state or federal discrimination lawsuit, it may be better to forgo a hearing to avoid showing your cards too early. Not contesting an unemployment claim won’t prevent you later from showing you fired the employee for a legitimate reason.