Monday, July 28, 2014

NEW YORK UNEMPLOYMENT INSURANCE - CAN EMPLOYER CONSENT TO INELIGIBLE REQUEST FOR BENEFITS - CONT PART 6

In April of this year, the law firm of Epstein Becker Green posted an article "Act Now Advisory: Changes to New York State's Unemployment Insurance Laws May Affect Employers' Severance Procedures and How Employers Respond to DOL Inquiries" and stated (italics supplied):

"In response to the requirements of the Act, as set forth above, the New York UI law was amended to provide that employers will not be relieved of charges to their UI accounts if the State UI Division determines that: (1) the payment of unemployment benefits was made because the employer or its agent was at fault for failing to respond timely or adequately to the request of an agency for information relating to a claim for UI benefits, or (2) the employer or its agent has established a pattern of failing to respond timely or adequately to such requests.

In New York State, the UI Division generally sends requests for information pertaining to a former employee's eligibility for UI benefits in a standard form, which asks for information, such as the former employee's previous pay and the circumstances of his or her termination. Upon receipt of the request, New York employers have 10 days to respond. Employers that do not submit a timely response will be deemed to have failed to respond. Employers that fail to respond to two or more claims are deemed to have exhibited a "pattern of failing" to respond and will not be refunded any erroneous UI payments that are recouped by the State. In other words, even if the UI Division decides that the former employee is not entitled to benefits (or has been otherwise overpaid), the UI Division will not credit the employer's account (as it used to do). Instead, that money will be paid into the State's general UI Fund.

Thus, if an employer wishes to contest a UI claim, it should ensure that it makes a timely and complete response to the UI Division's initial request for information. On the other hand, if the employer does not wish to contest the claim, there does not appear to be any independent penalty for not responding. We are aware that some New York employers opt not to respond to such inquiries, either because they wish for the former employee to receive UI benefits or because they fear that their response to the UI inquiry will be used as evidence in some other proceeding, unrelated to UI eligibility (e.g., a discrimination claim). Now, employers must understand that failing to respond may have other implications."

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