What has occurred?

Recently North Carolina sent Adequacy Threshold Determinations to thousands of employers. These determinations notified employers that they had established a pattern of untimely or inadequate responses in responding to requests for information (Form NCUI 500AB) on unemployment insurance claims filed during the 12-month period (August 01, 2014 – July 31, 2015).  Per the chart below, North Carolina has defined a pattern as 2 claims or 2% of responses in a 12-month period.

 

December2015.Patterns

This determination is made annually based on an August 1-July 31 reporting period. Employers who have received these determinations will be penalized by not receiving relief of benefit charge for erroneous for the next charging year cycle. As North Carolina recently moved from an annual charging cycle to a quarterly charging cycle, that means beginning the 1st quarter 2016 and continuing for the remainder of 2016, the employer’s account will not be relieved of charges for the payments that a claimant has received that are subsequently overturned on appeal, if that claim is found to have been responded to untimely or inadequately.

Each quarter the employer will be issued a determination highlighting the claims that were not relieved of charges due to inadequate or untimely responses.  Employers who disagree with these decisions have 15 days to protest the determination.

How will they determine timeliness and adequacy?

North Carolina will be reviewing claim responses from employers and/or their agents to for both timeliness and adequacy of the responses.  As such they have provided a definition of what they are looking for in each instance.

Timeliness:

  1. Whether the response was received within 14 days pursuant N.C.G.S. 96-15
  2. Whether the employer had good cause for failing to respond within the 14-day period

Adequacy:

  1. What information was requested
  2. Whether the response to the request is sufficient to satisfy the request
  3. Whether an employer should have provided DES with copies of relevant handbooks, policies, warnings, recordings, documents or other information related to the claim
  4. Whether the employer’s responses provide enough facts to enable DES to make a correct determination without having to contact the employer or obtain additional information

How will this affect my organization moving forward?

Because North Carolina is noting each claims as either timely or adequate. It is imperative that all claims are responded to within the 14 days noted by North Carolina Department of Employment Security. As well, all responses must include all evidence relevant to the reason for separation and all requests for additional information must be responded to by the due date given by the state agency representative.

As well, if your determination indicates that it is found to have not had an adequate response or was untimely, unless you can provide a valid reason why your organization was unable to respond under the appropriately, no appeal should be filed.

What are other states doing?

CCC has seen an increase in the number of states that are indicating on initial determinations whether or not the response was adequate.  While these states are not currently penalizing employers for these responses, it is only a matter of time. As 2016 progresses, we can anticipate seeing more states that are using this legislation as a source of revenue.  Therefore CCC recommends that employers respond to all states anticipating that a state may take action using the pattern defined in the previous chart.

Questions?

Contact CCC at (800) 207-6926 or via contact@corporatecostcontrol.com

 


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