We’re all familiar with processing unemployment claims, but how much further do we actually look into these matters? Handling and properly contesting claims is vital to keeping your unemployment expenses and UI Tax rates down, however, that alone is merely scratching the surface. To dig deeper and ensure that your dealership is protected from overcharges, fraud, and higher tax rates, the statement of benefits charged is where to begin.
The statement of benefits charged is sent to dealerships by the state of FL every quarter. This document provides a total year to date amount taken from your account, as well as a list of those individuals who recently received funds. It’s important to note that this document is not a bill, it is a receipt. The State has already charged your dealership for those benefits! The Unemployment System is riddled with errors and by sending this document, The State has shifted the responsibility to you, the employer, to monitor these payments and ensure their accuracy.
State errors are not only common, but come in many forms. Those funds leaving your account can be paid to the wrong person - a current employee, past employee, or to a fraudulent individual who was never employed by your dealership! There may also be errors associated with the amounts that are being charged, the number of weeks being paid, or just the simple fact that they were denied benefits and should not be collecting!
According to the DOL the state of Florida has an unemployment overpayment rate of 5.7%. That translates into over $23 million in overpayments, in 2016 alone! Can you imagine your dealership operating at a 5.7% overpayment rate for all accounts payable?
That is the force driving the importance of auditing those charges. As a dealership, every time you receive a benefit charge statement, you should do the following:
- Ensure that all those listed worked for you in the past
- Make sure that the state issued ruling in favor of the claimant is the individual collecting the benefits.
- Verify to make sure the individual is not collecting more money than they should.
- Verify to make sure the individual is not collecting more weeks than they should.
Again, you have already been charged for these payments, so you must review and protest them timely. You have a deadline of exactly 20 days to protest any erroneous charges.
The unemployment tax system in Florida is very sensitive. Meaning that just one claim, administrative oversight, or any one of the many possible state errors can move your dealership into a higher tax rate assignment. It’s that sensitivity which takes the 5.7% error rate from dangerous to devastating with regards to your dealerships unemployment tax expense. Next time you receive a statement of benefit charges, don’t just throw it in the filing cabinet; make sure you follow the above steps to ensure you are not overpaying.
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