UI Claims Management

4 Reasons for Outsourcing Unemployment Claims Management


Emptech's founder, Jeff Aleixo


Jeffrey Aleixo


For most employers, managing unemployment insurance claims (UI claims) can be an extraordinary challenge, even for those who have a dedicated staff to take care of UI paperwork. When faced with unemployment claims process, employers have to deal with complex and constantly changing compliance regulations and increasing costs. Furthermore, they usually lack knowledge of the direct connection between their UI tax rates and their number of UI claims. Whether the business is small or large, nuances of the UI process are difficult to comprehend, especially when it comes to multi-state employers.

In today’s economic environment, controlling rising unemployment costs is a critical and challenging task, no matter how time-consuming and tedious this process may be. Not many employers are familiar with unemployment laws and requirements, and most of them do not have the time or resources to adequately defend themselves and successfully fight claims. Therefore, managing claims can be very costly and demanding. 

One simple claim can cost a business thousands of dollars in taxes and affect a business’ tax rate for three years. In addition to the already-high cost of unemployment claims, many business owners overpay them. However, while employers cannot really control whether an employee files a claim, they can take steps to reduce the risk of unqualified claims being levied against them by outsourcing unemployment claims management.

Use this comprehensive guide to learn about UI rules and process and how to achieve a higher level of control over unemployment paperwork and UI costs.

Effective UI Claims Control

No one can avoid unemployment claims because former employees are always free to file them. However, employers can minimize the number of claims and maximize their ability to defend themselves against those that have been filed.

Preventing unemployment costs begins long before a claim is filed. It is an ongoing process that involves solid HR practices, policies and progressive documentation. Still, employers can lose unemployment claims they should have won simply due to a lack of written documentation. In addition to this, much of the success in winning unemployment claims has to do with responding to all notices and requests in a timely manner. 

On the other hand, outsourcing unemployment claims management can save companies money and time by helping reduce potential liability and prevent costly lawsuits. With the expertise and knowledge of the complex and evolving compliance government unemployment regulations, everything from actually terminating a person’s employment to managing unemployment claims administration, appeals, or benefits, is taken care of. Thus, outsourcing unemployment claims management relieves employers of time consuming burdens associated with handling claims and allows them to focus on the areas of their business that actually generate revenue.

As an efficient and cost-effective approach that helps employers remain UI compliant, outsourcing unemployment claims management has many advantages:

Cost Reduction

Managing unemployment can be a lengthy and costly process that takes up companies’ limited resources. In order to have an efficient system for unemployment compliance, employers need to determine and set up controls to process and monitor the system, train staff to understand unemployment claim issues and coordinate everything. Yet, outsourcing unemployment claims management helps reduce the costs of hiring more administrative staff and ultimately helps businesses remain efficient.

UI Expertise

One of the biggest difficulties with unemployment claims is that every state has its own unique regulations. In combination with ever-changing UI compliance requirements, this becomes a real challenge. One of the benefits of outsourcing unemployment claims management is that companies get to work with a team of experts who have decades of UI management experience, understand the UI laws, rules and regulations and how to handle hearings in all states. Furthermore, they keep track of all new regulations and update systems for compliance to prevent exposure to fines or legal issues. They can also advise employers on the tax rates and best strategies for each individual state.

Identifying Mistakes through Auditing

Companies struggle to keep up with ongoing unemployment claims and often do not have time to audit claims history. This can be a missed opportunity because state governments can make mistakes in their calculations, employers can overpay a claim or the government could be charging companies the wrong tax rate. Most employers do not have the expertise, systems or resources to audit their charges and taxes. However, outsourcing unemployment enables employers to detect errors and overpayments by going through a thorough auditing service. Also, outsourcing helps companies establish new controls to prevent these mistakes from happening again.


Outsourcing unemployment claims management is based on advanced systems designed specifically for UI claims administration in order to help companies manage the entire process efficiently. Automated unemployment claims management solutions enable employers to collect and manage claim information from many sources, assign tasks and monitor performance at all stages of the process, and enable information retrieval in seconds while improving the speed and accuracy. In addition to this, they maintain data security and confidentiality, supporting federal- and state-mandated privacy and retention guidelines.

Proactive Approach to Unemployment Claims 

No matter what is the size of a business, handling unemployment claims can be daunting. A single claimant can cost a company quite a bit of money, especially when overpayments are taken into consideration. However, outsourcing unemployment claims management can save companies money and time. With the necessary expertise and resources, businesses can successfully and efficiently deal with unemployment claims in the cheapest and most efficient way possible. Employers can control and monitor their unemployment claims, appeal unfavorable decisions, prepare for an unemployment hearing, audit charges, and generate reports in any manner and frequency they wish. Thus, they can manage their unemployment costs in a simple, cost effective, and efficient manner.

Outsource unemployment claims management to experience the expertise and resources your business needs to successfully and efficiently deal with unemployment claims in the cheapest way possible.
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