Help Avoiding Unemployment Claims

HENRY

Here is my question, I work in a auto dealership
and as with just about all dealerships, when we hire salespersons, if after 4,5,or 6 months, they are not selling, then we terminate them.
They go to the unemployment and file for unemployment, which they usually end up getting,
because when we terminate them, the managers let them go stating, "work unsatisfactory" or unable to perform duties, well when I respond to the unemployment claim, and put this down as reason for termination, the unemployment office comes back stating that this is not misconduct, and they (ex employee) gets unemployment. I am in Texas and would like some advise on how to handle this to avoid having to pay unemployment,and possibly lower our companies, unemployment tax rate. Your replies are greatly appreciated.

Don D

Good question, Henry, but I'm afraid there's not much wiggle room for your company on this one. When people are hired, as in your case, on a try-out basis and are then let go when they don't produce, the Unemployment Insurance Claims Examiner has to find that the individual was terminated through no fault of their own. The theory is that it's not their fault that they couldn't rise to the level of your expectations. So they are ruled eligible. If you terminated one for violating policy, cursing customers, giving the sales manager the finger and mooning the secretary, then you'd have a winnable case. But all these salespeople you dismiss are going to be eligible, simply by definition. But, fear not; if you keep up this cycle of the revolving door, the company will eventually reach the point where your rate cannot go any higher. There's a cap on it.

lnelson

Unfortunately, the Unemployment office considers few things as "misconduct". So in many cases were the ER is terminating the EE be prepared to pay the Unemployment.

I had an ee who was a driver, when he went on jobs with additional ees he felt he needed to take a break almost everyday to go to his house (out of his route) for approx. 30 min or so (above and beyond his normal break/lunch). The other ees just sat in truck and waited. Then show up over the allotted 8hrs and all ees receive OT.

We termed for misuse of company vehicle and company ee's. He still received unemployment benefit.

Don D

That's hard to imagine, but wait, I notice you are in CA. If a driver were to drive 'out of route' in this state or most, it would be a violation of company policy and surely that would be in your handbook. When I worked in the transportation industry, we terminated drivers for this sort of behavior almost daily and never lost a claim, except in California. Even lost one there when a female driver jumped a truck with a trailer load of cigarettes (about the most valuable cargo you can haul) and claimed she had a premonition that she needed to be at home with her daughter and off the road. Go figure.

juju

I agree that misconduct can be quite difficult to prove. We have termed several employees who were caught sleeping on the job (sounded like pretty gross misconduct to me). They were ruled eligible because we could not prove they were sleeping rather than "sitting with eyes closed." We always try to have lots of documentation. Sometimes we get lucky.

Superlative

Henry, you could try to raise your hiring standards. Hire only those who have a proven track record in sales. Sure, you will have to pay them more, but some will be offset by your lower unemployment tax rate.

cebudragonlady

[font size="1" color="#FF0000"]LAST EDITED ON 06-10-04 AT 04:44PM (CST)[/font][br][br]Henry, Did the dealership do an anaysis as to "why" these salespersons are not selling enough ? Is more training needed ? Is the training good enough ? More than the Unemployment Costs, is the cost of your TURNOVER !

Chari

TN HR

Agree with the other posts in that there isn't really anything you can do. About the only other suggestion I can think of is to run them through a temp agency for the first xx number of months and call it a temp-to-hire or whatever you wish to.

You are using the agency strictly to payroll. You retain the autonomy of advertising, interviewing, selection, etc, so you're rate with them should be significantly lower than if they were providing a turn-key service.

I do this with certain positions for several reasons, including minimizing UI exposure. I am charged 26% mark-up over pay rate for this (since you're dealing with variable comp, you may need to do a flat rate per person). You will have to do a cost analysis to see if it's worth it in your case.

Let us know how things work out.

Gene