4 Signs That It’s Time to Outsource Your Unemployment Claims Management
Many organizations find it challenging to handle unemployment claims accurately, efficiently, and cost-effectively using internal resources. Outsourcing your claims management function can eliminate the administrative burdens, improve compliance, and drive down your costs by helping you win more claims.
But how do you know if the outsourced approach is right for your business? If you’re facing any of these four situations, you could benefit from outsourcing unemployment claims management.
#1: Your unemployment claims volume is increasing.
If you’re experiencing steady growth, whether organically or through M&A, your employee base will rise and that may naturally increase your unemployment claims activity. The same is true if you move into new markets to capitalize on emerging opportunities.
The more unemployment claims, the tougher it is to handle all the associated work internally. Your first inclination might be to dedicate one HR person solely to the task, but that means moving a team member off other important work or hiring an additional employee—and neither is ideal.
When the claims volume becomes too large to handle effectively and affordably in-house, outsourcing is an attractive alternative. If you choose a partner that offers a performance fee model (versus the traditional fee-per-claim approach), the outsourcing equation becomes even more financially appealing.
#2: Your HR staff doesn’t have the capacity to handle unemployment claims effectively.
Many factors can stretch your internal HR team thin. Maybe you’ve lost HR staff to attrition and you’re having trouble filling their positions. Perhaps you’re in the midst of a major transformation and your team has its hands full with employee engagement initiatives. Or you’re about to open a new facility and you’re busy recruiting for hundreds or thousands of open positions.
Whatever the reason, your HR team might not have the time to focus on managing unemployment claims. That’s when costly problems happen, like failing to respond to a claim notice on time or filing a response without proper documentation. You might also miss erroneous charges on your unemployment insurance (UI) account or fraudulent claims, increasing the amount of UI tax paid.
Outsourcing claims management to an experienced vendor takes the administrative burden off your staff’s shoulders and ensures the work gets done correctly and timely. An outsourced vendor will follow efficient processes that streamline the work (such as receiving claim notices electronically from the state), help you craft a winning claim response upfront, and even root out fraud and errors that would otherwise cost you time and money.
#3: Your HR team spends too much time on claims and not enough on strategic work.
One of the most important functions of the HR team is to attract, retain, and engage a talented, skilled workforce that contributes to the organization’s success. Managing unemployment claims is an administrative function that involves former employees who are no longer making a positive impact on the business.
The former should certainly take precedence over the latter. So if you find that one or more HR employees can’t focus on work that has a positive effect on the business because they’re mired in the administrative tasks of claims management, that’s a sure sign you should outsource this function. Outsourcing unemployment claims management allows you to focus finite internal resources on your core business and your current and future workforce.
#4: You’ve paid penalties for unemployment claims compliance issues.
When your HR staff doesn’t have the bandwidth to give proper attention to unemployment claims, costly problems occur. For example, in many states if you fail to file a claim response on time, you’ll incur a penalty. You could even pay a penalty on a qualified decision that is reversed on appeal, under the Unemployment Insurance Integrity Act. If the state determines that the information in your original claim response was insufficient, you’ll be charged for the benefits the employee received up to the point of the decision reversal.
Paying penalties and unnecessary claim benefits is NOT a required cost of doing business. When you outsource claims management to an experienced vendor, you get a team dedicated to ensuring you avoid the most
common claims mistakes and respond to every unemployment claim timely, thoroughly, and accurately. As a result, you’ll avoid unnecessary charges and win more claims upfront, reducing the time and expense of preparing for hearings.
Outsourcing to UC Alternative Can Help
If your business if grappling with problems like these, it’s time to consider outsourcing unemployment claims management. And there’s no better partner than UC Alternative.
UC Alternative eliminates the administrative burden on your team by taking ownership of the unemployment claims function, reducing your HR staff’s workload. We apply our deep expertise, proven processes, and proprietary technology to ensure every claim is handled accurately and on time, so you can win more claims upfront and on appeal—and reduce your unemployment-related costs.
Request a call with a UC Alternative representative to learn how our claims management services can solve your HR capacity problems and help you win more claims.
