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Unemployment Claims Can Be Costly | PEO blog

Wednesday January 25, 2012

As a business owner you know sometimes the process of hiring and firing can feel like a revolving door, what you may not realize is that having high turnover can also affect your unemployment tax rate if it is not managed properly.

Employers can have their unemployment rates rise in direct proportion to unemployment claims of terminated employees. In other words if your business has a high amount of employee turnover, typically you can expect to pay a higher unemployment tax rate.  Unemployment tax rates will also fluctuate based on company payroll and unemployment benefits charged against your company.

Unemployment insurance remains the only payroll tax that employers can control by properly managing the Human Resource policies in regards to terminations.  The simple task of properly returning the official unemployment report form to the state within the deadline stated on the form is the first step in managing unemployment claims. The deadlines are very seldom extended, even if you have a good reason.  If a timely response is not received by the state, often this will result in the claimant receiving benefits.

Unfortunately, many business owners don’t focus on issues like properly responding to unemployment claims. This is where a Professional Employer Organization, PEO can be extremely beneficial to your organization.  As a business owner you typically would focus on building your business rather than focusing on the minutia of dealing with issues like unemployment.

True entrepreneurs often fail at handling these day to day tasks because they don’t see them as an important part of managing their business.  If you’re a business owner who would rather focus on your business rather than on managing your employees thousand great time look for a quality PEO.  You can search online at and find a great PEO for your company, set yourself free from these tasks today!


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