The Unemployment Trap

Contributed by Terry Fox

We have seen a recent uptick of terminated employees getting counsel involved in the unemployment fight.  When the employer lodges a protest, particularly based on misconduct, there is normally a telephonic hearing.  Testimony is taken in that hearing under oath.  The proceedings are to be confidential.  However, the factual basis asserted by the employer for the protest can be and is more frequently used outside of the unemployment context by the employee, including in employment litigation against the employer.

This presents a conundrum for the employer, who wants to efficiently handle the unemployment dispute.  Resolution of unemployment contests are designed to be quick, efficient, and inexpensive. A cottage industry has grown up in Illinois where non-lawyers represent employers in these telephonic hearings.  Sometimes they charge per hearing, sometimes per dispute. 

We recently experienced such a dispute, handled by a non-lawyer, where the results were less than ideal.  First, this consultant dealt with “custom” of the unemployment agency, not bothering to pay close attention to the administrative procedures of the agency.  Second, the consultant refused to provide witness statements to the employee’s attorney prior to the hearing.  Third, the consultant refused to provide identities of the employer’s witnesses prior to the telephonic hearing. 

Result- the employee appealed, got the employer’s win reversed and set for a second hearing.  In addition to the time and expense, the employer is faced with differing versions of its witnesses’ testimony under oath.  If there are multiple versions of the reasons for termination, the employer will never get out of the main age discrimination claim this employee has filed, absent a jury trial.

Suggestion – if the employer is contesting unemployment benefits on misconduct grounds, think seriously about getting legal counsel involved prior to any hearings, especially if the employee has made threats of a discrimination or other wrongful termination claim.