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Be Careful What You Tell The Unemployment Commission

Published by on June 23, 2008

During a labor and employment law seminar last week, I heard commentary on the use by employers of services to handle unemployment hearings or EEOC position statements.  Although these services are very helpful for many employers, there is one substantial risk that arises in doing so.  In many cases, the prepaid services do not devote […]

During a labor and employment law seminar last week, I heard commentary on the use by employers of services to handle unemployment hearings or EEOC position statements.  Although these services are very helpful for many employers, there is one substantial risk that arises in doing so.  In many cases, the prepaid services do not devote sufficient attention to stating the true and complete reason for the employee’s termination.  This can lead to admissions being made that will be used against the employer in subsequent EEOC proceedings and end up being devastating.

My personal experience with this issue involved a case I worked on in the 1990s for a small employer in Northern Virginia with less than 15 employees.  In that case, the employer terminated an hourly worker for poor job performance.  When they received the employee’s unemployment claim — feeling sorry for the employee — they told the Unemployment Commission that the reason for the discharge had been “lack of work.”  The subsequent award of employment benefits was the least of their worries. 

The employee filed a discrimination claim with the local county human rights commission.  During the investigation, the investigator obtained a copy of the unemployment submission by the employer.  That submission directly contradicted their position statement in which they stated that the employee had been fired for poor performance.  This led the Commission to conclude that the employer’s stated reason for termination — poor performance — was a pretext for discrimination.  The Commission subsequently entered a probable cause finding against the employer. 

Cases such as this are easier to defend if the employer submits the true and complete reason for an adverse employment action to the Unemployment Commission or the EEOC in the first instance.  In addition to the obvious risk of having inconsistent positions on the record, an employer may also be tempted not to outline all of the reasons for the termination.  This is a mistake as well, because in any subsequent EEOC litigation the employer may be limited to the reasons that are stipulated in prior proceedings.

The bottom line?  Employers should be complete in any submissions to the Unemployment Commission or to the EEOC with respect to the grounds for termination of the employee.  If the company is using an outside service to prepare these responses, the company should take steps to insure that the service has access to the personnel records showing the real reasons.  Access is not enough, however, if the termination documentation is incomplete or inaccurate.  Training and counseling of supervisors and managers is therefore critical to ensure that they properly document the grounds for a termination.

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