The following discussion focuses on the most common ways in which employers make mistakes unknowingly in responding to employee claims with the Texas Workforce Commission ("TWC"). There are only a limited number of ways the employee, or "claimant," can be disqualified from making a claim, which are primarily by being fired for misconduct connected with the work or by quitting for personal reasons unrelated to the work. However, there are a few reasons why TWC cases are sometimes unavoidably difficult for the employer.

1. Discharging an employee when the urge arises.
Employers should not assume that what makes good business sense or what "feels right" at the time of discharging an employee will be enough to convince TWC to disqualify a claimant or protect an account from chargebacks. The employer bears the burden of proving misconduct. TWC will disqualify a discharged employee from benefits only if the employer shows that the claimant was fired for a specific act of misconduct connected with the work and that he either knew or should have known he could lose his job for such a reason. Most TWC decisions boil down to a "reasonableness" standard. In other words, if a reasonable employer would have fired the employee under the circumstances, and a reasonable employee would have been able to expect such a thing to happen, then the employer's case will have a chance.

2. Missing a protest or appeal deadline.
A late protest to the claim notice means the employer gives up its appeal rights, including the right to protest chargebacks to its account. A late appeal means that TWC may not consider the reasons why a person no longer works for the employer; without jurisdiction, TWC must simply dismiss the appeal. The solution is simply to respond immediately to all notices and rulings. If more time is needed to gather information or witnesses, a quick written general protest which states that more information will follow later will preserve the employer's appeal rights. With personal delivery, mail, or fax available, there is really no excuse for a late response.

3. Assuming that no news is good news.
Some employers feel that if they do not hear back from TWC about a ruling or an appeal, the claimant has been denied benefits. Closely related is the problem of failing to act immediately once a notice arrives that a former employee is now receiving benefits or that the employer's tax rate has increased unexpectedly. There may be some problem with the mail system or with how TWC handled getting notice of the claim to the employer that would excuse a late response, but once an employer has actual notice of a claim or a chargeback, the appeal deadlines start to run. The solution is to inquire about what happened with a claim. An employer who responds to a claim notice and does not get a ruling, or who gets an unexpected notice that a former employee is drawing benefits, or whose tax rate increases unexpectedly, should call promptly and find out why. If any of those inquiries show that benefits have gone or are going to a former employee who arguably should have been disqualified, the employer should write a letter immediately to TWC, explain that it never received a ruling that the claimant was qualified for benefits, and request a hearing to discuss those matters.

4. Failing to document the case against the ex-employee.
If the claimant denies being warned or having attendance problems, for example, and the employer does not have copies of warnings or attendance records, there is a good chance the claimant will have the strongest evidence and win. If the employer fired the claimant for a policy violation, attendance problems, violating warnings, or customer complaints, it should submit copies of the policy, attendance records, warnings, or complaints.

5. Failing to present the best witnesses.
One of the most fundamental principles of the American legal system is that an accused has the right to face his accusers. If TWC tried to ignore such a basic principle, its decisions would be subject to reversal in the courts. For this reason, TWC gives the greatest weight to firsthand testimony from witnesses with direct, personal knowledge of the events leading to the claimant's discharge or resignation. Secondhand testimony based upon reports from others is not worth much in the face of credible denials of guilt from a claimant. Although it may disrupt business to pull witnesses away from their work for a hearing, it is better than an almost certain loss in the case. An employer should answer this question: which presents the bigger burden, letting someone else cover for the witness during the hearing, or losing the case and receiving chargebacks that can increase the company's tax rate for three years to come? Recent improvements in hearing procedures allow witnesses to participate by phone from remote locations, which should make testimony from even the busiest witnesses more practical.

6. Firing employees without reasonable warnings.
Unless the misconduct involved is so serious that no reasonable employee could expect to commit it even once and still keep his job, TWC will expect to see evidence that the claimant somehow knew his job was in jeopardy for the reason given by the employer. TWC looks to see whether the employee had a reasonable opportunity to correct his performance or conduct and save his job. The solution is to supply reasonable warnings. Proper warnings given at appropriate times can often turn a problem employee around. They can also help show, in case wrongful discharge or discrimination claims arise, that the employer acted reasonably and gave the employee the same chance as everyone else to improve and stay on the job.

7. Ignoring employee grievances. If an employee quits due to problems with his pay, harassment from supervisors or coworkers, major and adverse changes in the job, unsafe working conditions, or unfair discipline, TWC will probably call that good cause connected with the work for resigning and pay the claimant benefits. However, TWC may disqualify the claimant if he failed to give the employer reasonable notice he was so dissatisfied he was thinking of quitting. This is the flip side of putting an employee on notice that his job is in jeopardy. Failing to respond effectively to legitimate grievances can lead to expensive court actions as quickly as it can lose an unemployment case. Employers who build an atmosphere of trust among their employees by letting them know they all count, by treating all complaints seriously, and by encouraging a feeling that they can tell management at all levels about their grievances are the ones least often hit with claims, lawsuits, and unionization efforts.

8. Failing to follow stated policies.
TWC holds claimants to what they knew or should have known. If the employer does not follow its own progressive disciplinary policy, for example, it will have a difficult time showing how the claimant was on fair notice that she could lose her job for the reason given. On the other hand, failing to provide certain benefits promised in a written policy could possibly give an employee not only good cause connected with the work for quitting, but could also lead to a successful payday law claim against the company. Companies that carefully draft policies and warnings and carefully follow what they have put down will have little to fear.

9. Failing to confront the claimant with the reason for discharge.
Even though the law does not require an employer to give an explanation when discharging an employee, TWC generally looks to see whether the claimant was confronted with the problem leading to the discharge. If the employer had enough confidence in its action to allow the claimant a chance to explain his side of the situation, its case will appear that much more credible to TWC. This procedure has the added benefit of allowing the employer a "last chance" to find out if there is a good reason not to fire the employee. A related problem is that of giving the claimant a false or misleading reason for termination. Such action is almost always fatal in a TWC case. These are not the only ways to lose a TWC claim, but they are the most common and avoidable ways. The law already makes it easy enough for a former employee to draw benefits. Practicing common sense and consulting legal counsel when in doubt will reduce the chance of losing a case unnecessarily. Avoiding the types of problems noted above will also help employers avoid trouble with more serious matters such as wrongful discharge, employment discrimination, and employment tort liability.

Conclusion
Remember, the unemployment compensation law was designed to primarily help workers, not employers. This is unlikely to change as long as workers outnumber employers. Remaining cautious of the foregoing problems may well save the employer time and money in handling employee claims.

REFERENCES:
Texas Workforce Commision, Especially for Texas Employers, 1992-1998.
Robert C. Rice, Rice & Associates, Houston, Texas, TWC Claims, 1998.

Boyd W. Shepherd is licensed to practice law and dentistry in the state of Texas, and is a member of the GHDS, TDA, and ADA.