• Two Big Changes in Ohio's Unemployment Rules
  • July 31, 2013 | Author: Patricia F. Weisberg
  • Law Firm: Walter - Cleveland Office
  • On July 11, 2013, Governor Kasich signed into law a bill modifying unemployment compensation practices and procedures. Two of these changes will impact the way employers in Ohio manage the unemployment application process.

    SharedWork Ohio

    The first change allows employers to reduce workers' hours while permitting workers to collect unemployment compensation benefits. Twenty-five other states have already adopted similar programs.

    Under SharedWork Ohio, an employee can continue working reduced hours rather than being laid off and also collect unemployment benefits to make up the difference for the hours that were cut. This benefit also allows the potential for employees to maintain their existing healthcare and retirement benefits.

    To qualify, participating employers must submit a plan to the director of the Ohio Department of Job and Family Services (ODJFS). The plan must be in lieu of layoffs and cannot exceed the total unemployment cost of a traditional layoff.

    Legislators who support this measure believe that the program will be less costly for employers. They argue that traditional layoffs often result in higher unemployment premiums. In addition, it is anticipated that the SharedWork plan will cost less for employers due to reimbursements from the federal government until 2015. During the two-year period, the federal government will reimburse Ohio for SharedWork benefit payments. These benefit payments will, therefore, not be charged to employers' accounts.

    It is important to note that the program will not occur automatically. Employers must take affirmative steps to participate in the SharedWork Ohio plan.

    New Penalty for Employer's Failure to Cooperate with ODJFS

    The new law allowing for the Shared Work Ohio plan makes other changes to Ohio's unemployment laws. One of the significant changes is that Ohio law will now require an employer's account to be charged in the event the employer engages in a pattern of failing to timely or adequately respond to requests for information regarding a claim, thus resulting in an improper overpayment.

    In the past, for various reasons, many employers opted not to provide information to an initial or subsequent request from ODJFS regarding a former employee's application for unemployment benefits. Now, if an employer engages in a pattern of failing to timely or adequately respond to these requests, the employer's account will not be credited if ODJFS decides that it erroneously paid unemployment benefits to a claimant. As a result, in general, it is now even more important to cooperate with ODJFS and provide the necessary information in a timely manner. In some situations, it will be more prudent to consult with legal counsel as to how and when to respond to these requests. If there are other issues and special circumstances giving rise to the employee's separation from employment, legal counsel should be sought before taking any other action.