Frequently Asked Questions
Since 1972, the Unemployment Insurance Division of the California Association of Hospitals and Health Systems (CAHHS), formerly the California Hospital Association, has provided unemployment insurance (UI) services to health care employers. We have found that the employers with whom we work have a wide spectrum of understanding regarding unemployment insurance law and also what circumstances can influence their UI costs. This wide variation can be explained by two factors: (1) unemployment insurance law is actually quite complex and detailed in its organization, and (2) employers are all individuals who come to this area of administrative law with vastly different levels of experience. For example, most people understand that the government provides some income for people who are "out of work" or "lose their jobs." Few, however, could articulate that the purpose of unemployment insurance is to provide temporary financial assistance to people who are involuntarily unemployed through no fault of their own.
Why don't I qualify for unemployment insurance after paying in for so many years? (Often asked by claimants.)
Claimants never contribute to the State of California Unemployment Insurance Fund, which is funded solely by employers. For-profit employers are taxed, primarily based on their past UI rate experience; non-profit employers are permitted to reimburse the State Fund dollar-for-dollar for all UI benefits paid to past employees. The employers fund 100% of the UI benefits afforded claimants.
Sometimes an employee whose employment with us is terminating asks if he or she can draw unemployment insurance benefits. How should we respond?
It's best not to give an opinion. The employee should be given the Employment Development Department (EDD) UI booklet "For Your Benefit ...California's Programs for the Unemployed" (Form DE 2320) and should be told that only EDD can make a decision about eligibility for UI benefits. You might add that many factors other than the reason for the loss of the job (such as availability for work) are involved in the decision and therefore your opinion could possibly mislead the employee.
Are claimants required to file for benefits in person?
Although the answer to this question would once have been affirmative, times have changed. For reasons of security and fiscal efficiency, EDD has adopted a system that has created distance between claimants and EDD personnel who have the responsibility for deciding eligibility issues. Claimants today file for UI benefits by phone or on the internet. All subsequent contacts between EDD and the claimant, employer or employer's representative are made by phone. Job Service Centers, however, continue to provide in-person services. The Job Service sites are listed in the State Government section of the blue tabbed pages of the telephone directory in your local area.
Why are on call or per diem employees eligible for UI benefits? This doesn't seem right… the employee knew the work was on call when hired!
California UI law states that claimants who are unemployed or underemployed may be eligible for UI benefits. The fact that the employee has accepted less than full-time work is not disqualifying in and of itself. However, if the claimant refuses more work or restricts his/her availability for work, those issues must be addressed. The claimant in this case would very likely be temporarily disqualified for not working when the employer offered additional hours. Note: CAHHS should be notified immediately in all cases where a per diem employee refuses work or limits his/her availability.
Aren't employees who quit their jobs ineligible for unemployment insurance benefits?
This is a common misconception. Actually, there are numerous circumstances under which a person could quit a job and be found eligible for UI benefits. The single most common example is the person who must quit employment to accompany a spouse to another location, if that move is made to preserve the family relationship. Similar situations might include registered domestic partners or unmarried couples who have a child or children together. There are many other personal but compelling reasons which might establish eligibility if it is determined that a reasonable person desirous of maintaining employment would choose unemployment under the same circumstances. An employee might choose to quit for health reasons or heavy family responsibilities, for example, assuming of course that a leave of absence would not alleviate the problem. However, it is important to remember that the issue of availability for work often must then be considered: Is the claimant able and available to accept employment? If the answer is "no," the claimant would probably be disqualified on that basis.
EDD says that we fired the claimant. However, we allowed the claimant to quit. Why, then, did EDD find the claimant eligible for UI benefits?
Here it is important to consider the concept of "moving party." Who took the action that resulted in the claimant's unemployment? If the employer initiated the action, the separation was a discharge and therefore the next question to be addressed is whether there was misconduct involved. Calling an employment separation a quit does not make it so under UI law. EDD is required to make its own determination based on the circumstances that led to the separation. Using the moving party principle, EDD views permitted resignations as discharges because the employee's separation from employment was not truly voluntary but reflected the employer's will.
A related aspect of this "moving party" concept is raised under circumstances such as the following: An employee informs the employer that he or she intends to quit, usually naming a future date as the last day of work. The employer, for whatever reason, chooses not to have the employee work out his notice and advances the last day of work. The employer who does this has just changed the character of the separation from a quit to a discharge, very likely making the claimant eligible for UI benefits since the employer could not convincingly argue that the discharge was for misconduct. How can this costly situation be avoided? It is permissible for the employer, who may not want a possibly inattentive or disgruntled employee to remain on the job, to advance the last day of work so long as the employer pays the employee his regular wages through the date chosen by the employee. The character of the separation remains a quit and the claimant's eligibility for UI benefits will depend upon the employee's reasons for leaving employment.
We fired the claimant for misconduct, for violation of our policies. How could EDD find the claimant eligible?
In order to evaluate misconduct in an even-handed and fair manner, EDD relies upon a definition of misconduct as provided by precedent decisions and the courts. In general, misconduct is behavior that is a willful and substantial breach of the claimant's material duty owed to the employer, a breach that tends to injure the employer's interest(s). This definition excludes actions arising, for example, from mere inefficiency, unsatisfactory work performance or good faith errors in judgment. A large body of administrative law has evolved to cover the many complexities of the definition of misconduct during employment.
This question ... what constitutes misconduct ... leads to another common misperception. Employers sometimes complain that an employee was discharged following warnings but nevertheless was found eligible for unemployment insurance benefits by EDD. Frequently, the warnings arose because of an attendance problem. The employer issued a strong warning and then discharged the employee for the next infraction of tardiness or absence. However, if the final tardy or absence was a result of circumstances beyond the employee's control (illness, for example), then the discharge would not rise to the definition of misconduct under UI law. A strong final incident is vital in all cases in order to prove that misconduct, as defined above, led to the employee's discharge and that the claimant therefore should be disqualified.
Why is it so important for supervisors to attend UI hearings? Why can't personnel from human resources go or perhaps the department head?
Although it might seem logical to send only a high-level management employee to represent the employer, this is almost always a mistake. Hearings are held after EDD has made its determination and after the losing party has appealed. The hearing takes place before an Administrative Law Judge (ALJ) under the rules of administrative law. The ALJ probes to understand how the separation took place in order to apply the appropriate law. To do this the ALJ needs to hear first-hand testimony from the persons most closely involved. Any testimony that is not first-hand is deemed to be hearsay evidence and carries less weight in the ALJ's decision making process. In fact, the ALJ usually will fault the employer for not supplying the appropriate witness(es) when it was within their power to do so.
The claimant quit his job with us to take another job. He never filed against us, but now UI charges are appearing against our account. Why does this happen? (Asked by a non-profit employer.)
If you are a non-profit 501(c)(3) organization, you are allowed by law to reimburse EDD dollar-for-dollar for UI benefits paid to eligible past employees, rather than pay an experience-rated tax. (This option is not open to other employers.) When a previous employee files for UI benefits, is found eligible and his wages earned with you fall within the base period earnings of his claim, then your account will be found fully or partially liable. It is the claimant's eligibility that matters, not whether you were his immediate past employer.
The reason for this liability is your reimbursable status. The claimant is entitled to benefits, which are charged against his base period employer(s). Since you pay no tax which could be used to pay for his benefits, you must be billed to fulfill your UI obligation to him.
The claimant was disqualified for UI benefits but now charges are appearing against us (a non-profit employer). We won ... why should we have to pay?
Every claimant is allowed by law to purge a disqualification for UI benefits and thereby become eligible for benefits. A purge is accomplished if the claimant finds subsequent employment, earns at least five times his weekly UI benefit amount, loses that job through no fault of his own and then files again for UI benefits. The new claim could be filed within the year of the original claim or could be filed in the next year. The original non-profit employer is liable for charges as long as wages against that original employer fall within the base period of a valid claim.
The answers to this question are related to the previous answer only if you are a non- profit reimbursable employer. Your organization pays no UI tax and therefore has no participation in California's Unemployment Insurance Fund from which the claimant can be paid. Your organization must reimburse EDD dollar-for-dollar for UI benefits paid on a valid claim. A tax-rated employer, on the other hand, would not be charged directly for a claimant's UI benefits under the same circumstances. Instead, the claimant's benefits would be paid from California's Unemployment Insurance Fund, which is created by taxes paid by all tax-rated employers.
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The questions posed above may seem very basic to anyone who is well-acquainted with unemployment insurance and, of course, they are basic. However, this sampling allows some insight into the concerns many people working in the health care field have in their effort to understand why some employees draw UI benefits while other employees are disqualified. We welcome any and all questions we receive from our health care employers and applaud the effort to understand. The hoped-for-results will be a better understanding of what can be done to reduce the burden of UI costs on health care employers.