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Employers contesting layoff benefits

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TEXT OF STORY

Jeff Tyler: Imagine getting laid off, applying for unemployment benefits, and finding your ex-employer is challenging you. More companies are contesting benefits. To explain, Marketplace's Jeff Tyler takes us to court.


Jeff Tyler: At the appeals court in downtown Los Angeles, Monique Diaz is fighting for her unemployment benefits. Her last employer, a collections agency, claims she doesn't deserve assistance. The company fired her for missing her collections quota.

Monique Diaz: I did everything I could, but people just, right now, do not have the money.

Maybe she wasn't the best collections agent, but you can't be denied unemployment benefits based on job performance. People are generally ruled ineligible only for misconduct or if they quit. Still, workers' advocates have noticed a troubling trend:

Andrew Stettner: Workers are increasingly having their claims challenged by their employer.

Andrew Stettner is deputy director of the National Employment Law Project:

Stettner: Since your employer pays taxes on an unemployment claim, and that their tax bill will go up as more of their former employees claim benefits, they have a real incentive to challenge claims.

Many companies hire specialists to handle unemployment matters. The biggest is Talx, a subsidiary of the credit-reporting company Equifax. Stettner says Talx routinely contests benefits on grounds of misconduct, even if it's still gathering evidence to back up an allegation.

Stettner: They just write, "Employee broke a rule," and then they fax it in. And that's enough in most states to stop the benefits. And then a lot of people don't know what happened to them and they don't get their benefits.

Talx declined requests for an interview. Instead, the company referred me to Doug Holmes, who heads an industry trade group focused on employment issues. Holmes says companies sometimes resort to a pre-emptive unemployment challenge in order to buy time.

Doug Holmes: They may have one or two days to check with the employer, or check their records to try to identify the information that is needed.

When a claim is contested, the checks stop coming until the dispute is resolved.

Monique Diaz hasn't received benefits for two months:

Diaz: I'm glad I have friends and family that, you know, will help me out with the bills.

In some states, the wait for an appeal can take up to a year.

In Los Angeles, I'm Jeff Tyler for Marketplace.

About the author

Jeff Tyler is a reporter for Marketplace’s Los Angeles bureau, where he reports on issues related to immigration and Latin America.

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Mark Kastro's picture
Mark Kastro - Jun 9, 2010

I was recently employed at a company for 1.5 years. In that time, I had only called out sick once and then recently I called out sick (for the second time more than 4 months after the 1st time) my manager told me ok feel better and then calls me back 2 min later and says the GM say's they are letting you go. Now they are contesting my unemployment compensation saying that "I had excessive tardies & abscenses" however this isn't true nor was I ever "written-up" or spoken to about "tardiness" or "abscenses". What should I do now?

Chris Smith's picture
Chris Smith - Jun 5, 2010

Burn down Talx! If they take your food and shelter in the name of corporate greed then they declared war on you and your family. Take the war to them! You won't get caught.

Chris Ramey's picture
Chris Ramey - Mar 1, 2010

I was let go for "violating the company policy"; although I didn't. Now I have to try and convince the Unemployment office to give me assistance.

Kristen D's picture
Kristen D - Feb 24, 2010

I was hired by a temp company as a contract to hire where the employee said after six months I would be hired. Then three months into the assigment myself and the four other employees in my training class were laid off. We were told by our temp company that they were sorry and they ould approve our unemployment because they had no other work to offer us.

Well, fastforward three weeks later and they are contesting my unemployment. They blatantly lied and said I quit due to dissatisfaction of the job. Luckily I had a letter from the recruiter stating when my assignment would end, aka, my layoff letter. I had asked for that in writing when I was told I was being laid off. I faxed that letter to the unemployment representative and she said that was all she needed to make sure my unemployment keeps going. What I want to know is, are there any repercussions for the company that lied and said I quit due to dissatisfaction of the job? Thanks

S DeLeon's picture
S DeLeon - Feb 18, 2010

My experience. I worked for the one of the largest retail chains in the USA. Their corporate offices are in a very small state in New England. But their influence is as large as the universe. I was let go after 15 years of service and given no reason (at will employee)I was told when i was first hired that when you reach a certain level on the salary scale you have a target on your back. At first I did not believe this. I did my job, received good performance ratings and always got a large bonus. I watched my older associates get let go one by one over the years. I worked weekends for free. donates my time for their so called feel good projects. Donated money to their "Make them feel good charities" my reward was you do not have a job. HR was no help what so ever. When I decided to fight them with my own lawyer the road blocks were numerous. These people are in bed with your state labor departments and if you think you are going to fight them with class action suits, they will change the laws so you cannot do it. So wise up! stop doing their make us feel good events because they are guilty as sin and dirty as dirt can be. Just do the job they pay you for and nothing else.

S DeLeon's picture
S DeLeon - Feb 18, 2010

First! HR (Human Resourses) is the biggest fraud going. These people are there for one reason to protect the corporate interest not help you. Their real name should be Corporate Resourses.

LoveAt 350's picture
LoveAt 350 - Jan 25, 2010

This is s SCREW deal for the taxpayers. Flat out. It's NO WONDER people are lining up on the bridge to jump. I'm headed there, too.

Jennifer L's picture
Jennifer L - Oct 25, 2009

My position is being eliminated and my company is offering me 3 positions that I am unable to take because I have a child. All require turnarounds working 7 12 hour shifts. 1 position requires out of state turnarounds, another is a job with a 3 hour commute daily and the last position is something I have always thought was too dangerous and I do not feel qualified for the job. They told me at first that if I cannot accept these positions that I will be laid off. After I told them I cannot take any of the positions they told me that I would have to quit my job because they cannot lay me off because they offered me other jobs. My question is this legal what they are doing to me? My current position is being eliminated, but they do not want to lay me off, they want me to quit. Also, 2 weeks prior to my position being laid off I reported a problem to HR that I feel I am being discriminated/harrassed by my co-worker and supervisor and HR just ate her lunch while I was talking and did not document any of my issues. Also, she never followed up with me. It was as if I was looking for her to just be by psychiatrist and nothing more. She did not do her job to help me with my right and now they are eliminating my position and telling me that I have to quit. Is this legal???

B Williams's picture
B Williams - Apr 22, 2009

I am very concerned about the trend happening here in Maryland where companies are telling their workers to call in every morning to see if work is available and preventing them from getting unemployment benefits. Some have not worked in six months and cannot collect benefits because the company says they are still "employed." Is there anyway to address that?

Michael Faris's picture
Michael Faris - Apr 15, 2009

Here in mass., Randstad Corp/TALIX have made false accusations that some employee quit. Since they know this is illegal it is even more alarming.
I have informed the state attorney generals of this wide spread law breaking.

Call Steve Faris at 508-616-0385 to form a class action against companies that are doing illegal act.

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