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Unemployment Claims are on the Rise: How to Protect Your Employees

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Unemployment Claims are on the Rise: How to Protect Your Employees

By The Employer Group - Feb 11, 2021

Unemployment agencies planned for another typical year in 2020…that is until the COVID pandemic hit the United States hard in March. With this pandemic came millions upon millions of unemployment claims, and ample opportunities for scammers to take advantage of the not-so-perfect, and often outdated unemployment systems, causing a huge spike in fraudulent claims.

The state of Washington reported theft of $550 million to $650 million from the state’s unemployment system. Colorado cybercriminals were so aggressive, 75% of applications in any given month were ruled fraudulent. Inmates out of Pennsylvania’s prison system applied and qualified for unemployment benefits before they were caught. These are just some examples of the fraud schemes currently happening, with the most common form of unemployment fraud involving employees receiving unemployment benefits while still working their full schedules.

Employers are often the first line of defense, so here are some things you can do to help prevent this:

  • Notify the workforce – inform employees about the prevalence of these types of scams; inform them of the fact that individuals who have previously been subject to identity theft are more susceptible.
  • Be prepared – review any notices form the state unemployment administrator with heightened scrutiny.

If you do notice a fraudulent claim, here are a few things to do:

  • Assist the affected employee – help the employee report the issue to the state unemployment administrator. Provide them with various resources, such as the company’s Employee Assistance Program or Identity Protection benefit, if available.
  • Notify the appropriate state unemployment administrator – many states have fraud reporting forms and fraud hotlines.
  • Notify the Department of Labor.

Unemployment Insurance can be a complex and confusing process. Adding scammers into the mix only makes it more complicated. As a Professional Employer Organization, The Employer Group provides expert support in administering unemployment, as well as offers generous benefits including Employee Assistance Program and Identity Theft protection. Contact us to learn how we can assist you.

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