10 Days to Minimizing your Unemployment Costs: Tip 7

Tip 8: Weigh the consequences of partial employment, systematic layoffs, and independent contractors before you use them!

It should be self-evident, but too often employers act impulsively and don’t review all of their options before laying employees off, which ultimately raises their UI tax rates, or their cash on hand if they are a reimbursing employer. Layoffs can cost thousands of dollars in unemployment benefits.

Know when employees are eligible for partial weeks of unemployment, how a systematic layoff will affect your contribution rate, and whether independent contractors are a good idea for your agency.

In the case of layoffs, helping severed employees find jobs benefits the employer and employee.

Independent contractors may file for unemployment, and the employer needs to be able to prove he or she is not an employee of your company.

If you work with an unemployment trust or claims administrator, they can provide you with a listing of state-specific guidance that can highlight how helping severed employees find a new job will benefit both them and your nonprofit, as well as helping you properly document that independent contractors are not an employee.

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07/24/12 8:08 PM

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