How does unemployment affect employers? California
My family has recently experienced some major financial troubles and my mother has filed for unemployment. The reason why she lost her job was her place of work closed down due to low business. Today, when the unemployment official called my mother, my mother was told that she may not be eligible for unemployment benefits because the employer said that my mother quit her job, and was not laid off. When my mother called the employer to complain about things that the employer apparently told the unemployment official that were not true and the employer tried to convince her not to worry about it.
My family and I are interested to know how unemployment affects employers, because this employer is trying really hard to avoid it.
is paid by the employers in the form of a tax, paid to the state, based on payroll. Once a quarter (in most states), the employer sends a check to the state in the amount of (x percent) times their payroll for that quarter. It's a single check sent for all employees combined, but the specific breakdown per employee is included so that state knows what you've been paid, for future claims.
Periodically, most likely once a year, the state reviews the number of claims each employer has against them. If the employer has too many claims (and the state decides what is too many), then the tax the employer has to pay is increased. He'll go from (x percent) to (x+1 percent), or maybe even (x+2).
So you see there is a definite financial advantage for an employer to contest unemployment.