What’s New? Washington State’s New Unemployment Claims Management System
By Pamela Kiel
In 2016 Washington State’s Employment Security Department went online with a new claims management system, eservices. This system is part of a multiyear, multi-million-dollar upgrade to the departments computer systems. Unfortunately the integration is not going smoothly and is causing headaches for both employers and claimants.
The initial issue that affected mainly claimants was an overload to the online and telephone registration system. Many claimants were simply getting a notice that the phone lines were too busy and being disconnected from the call. At the same time, the online systems failed and many claimants were unable to file their weekly claim.
How has this affected employers? As a result of the claims back log, now the department is experiencing a back log in getting initial claim determinations out in a timely manner. At CCC we noted a significant number of initial claims filed in December and January that do not yet have a determination for benefits issued.
CCC contacted the Employment Security Department and were notified that not all of the data from the previous system had made it’s way to the new system. We were instructed to follow up with appeals to claims, where determinations had not yet been issued and could not be located in the eservices system.
What does this mean for employers? If you are a CCC client, we are auditing our system and following the instructions from ESD and filing appeals. So you as the employer, do not need to do any additional work. If you are not a CCC client and are awaiting a decision, you should follow up with the ESD with an appeal letter indicating that you have yet to receive a determination. Please be sure to reference the claimant’s name and social security number, along with your employer account number and legal name.
Have questions? Contact CCC at (800) 207-6926 or firstname.lastname@example.org
Unemployment Tax Update: Who’s the Employer?
By Norma Green
Over the past thirty years, flexible working arrangements have become a high priority with some firms. Employers known as a PEO (Professional Employment Organization) have become popular as well as contract labor, temporary help and leasing agencies have become fast growing sectors of the business world. The employees of these booming industries show up to work and provide services to an employer that does not issue their paycheck or pay them benefits. From an unemployment perspective, there has been much debate over the years as to who is the employer.
The most popular of service companies is the PEO. This firm is not a temporary employment agency. Instead they contract with other employers to provide human resource services for a fee. The PEO takes over the hiring, firing, insurance and many other benefits. For unemployment tax purposes, the PEO becomes the reporting vehicle. Some states allow the PEO to report under a single state unemployment account number thus issuing one rate for all the companies under contract. Other states force the PEO to report under the client’s state account number. The PEO becomes the employer as a result of the direction and control they have over the employees. Volumes of legislation have been written from an unemployment perspective. A bond is required and registration of the PEO in a given state in order to do business.
Contract labor is another sector that has seen growth and also much scrutiny. The IRS issued a 20-Factor Test to determine the definition of an independent contractor. Each state also defines and audit independent contractors. The ABC test was also established to help determine if the employee is an independent contractor. The basics of the ABC test are that the worker is free from direction and control. The services performed must be outside of the usual course of business that is being supplied under contract. Also the worker must be engaged in an independently established trade or occupation or profession. If any of these guidelines are not met, the independent contractor can become an employee of the firm. Routine audits are performed by unemployment state agencies to identify workers who are misclassified as independent contractors. Penalty and interest can be owed if the worker was misclassified.
Staffing companies, temporary agencies and leasing companies have also seen tremendous growth as well as scrutiny from the unemployment agencies. The contract between two companies does not define the employer. The employer the organization who has direction and control over the individual, pays the individual, supplies the tools of the individual and any training needed. Any variance to this may result in the client being considered the employer for an unemployment claims.
Each state provides guidelines that define an employer. Information can be found on each state‘s website regarding the definition of employer. If you are having independent contractor issues or have had issues regarding claims that made the client the employer, please contact our tax director, Norma Green at email@example.com or (800) 207- 6926, ext. 418.
Guideline: A Map to Unemployment Basics
By Pamela Kiel
Are you looking to find out the maximum benefit in your state? How many weeks a claimant can collect? Or what is the website for another state? CCC provides you a great, easy way to get to that information on our website. Once you get to corporatecostcontrol.com, simply click on CCC UI University. You will see a map on the right side of the page:
Then hover your cursor over the state you are interested. This will give you basic unemployment information on that state. Simply click on the state and you will be directed to that state’s unemployment agency website.
Questions? Contact CCC at (800) 207-6926 or firstname.lastname@example.org