There are a lot of misconceptions about the way the unemployment system works. A concept that is often misunderstood is exactly how protesting an unemployment claim impacts the outcome of the claim, or whether benefits are paid or denied.
When a current or former employee files for unemployment, you as the employer are notified by means of an unemployment claim, which is sent to your address of record (this may be your address or the address of your TPA). When this happens, the expectation of the state is that a response to the claim will be returned containing the details of that employee’s separation. Depending on the type of separation that occurred, which generally falls into one of three categories (quit, discharge or lack of work), you may or may not believe that the claimant should be entitled to collect unemployment benefits.
In the instance that a claimant quit or was discharged and you believe that they should not be entitled to collect unemployment benefits, you as the employer (or your TPA on your behalf) have an opportunity to “protest” the claim. So, what exactly does that mean?
When an unemployment claim is “protested,” a response to the claim is sent to the state containing the details of the separation (and often supporting documentation), which explains the reason that the claimant was at fault for the separation. Remember, unemployment is intended for claimants who lose their jobs through no fault of their own. Therefore, for someone to be denied benefits, it must be determined that the separation was within their control. Some classic examples of these types of separations include quitting for personal reasons or being discharged for a violation of an employer policy such as an attendance policy.
An important distinction that is often overlooked is that a “protest” is just that; a protest. It is not a ruling or a determination. Employers (and TPAs) have the right to protest unemployment claims in order to provide their detailed argument for why the claimant should not be entitled to collect unemployment. However, it is each state workforce agency that ultimately makes the final decision regarding whether or not benefits will be paid to each claimant. The state is tasked with reviewing the arguments and supporting evidence presented by both the employer and the claimant and determining, based on the totality of information submitted, whether the claimant lost their job through no fault of their own.
This concept also applies to the opposite scenario, when an employer does not wish to protest an unemployment claim because they believe that the claimant should be allowed to collect benefits. This simply means that the employer (or TPA) does not compose an argument against the claimant’s eligibility to collect. In most cases, a response to the claim will still be required as the state does ask for certain things such as the dates of employment and basic reason for separation to be provided regardless of whether the employer wishes to protest the claim. What is important to remember is that, as explained in the prior example, the state is still the ultimate decision maker with regard to whether or not unemployment benefits are paid on any claim. Sometimes, even when an employer would like for a former employee to be granted benefits, there may be other unrelated reason that benefits are denied by the state (for example, the claimant did not meet the work search requirements or demonstrate that they are able and available to accept new work).
To summarize, employers and TPAs do not make the final decision with regard to whether a claimant is allowed or denied benefits. However, employers are given a voice in the process through the right to protest unemployment claims in cases when they feel that the state should deny benefits. A protest is a written argument explaining why the claimant should not be entitled to collect, and it is reviewed and weighed by the state when making the determination regarding the claimant’s eligibility.