Store Owner Gets Word That a Current Employee Has Filed for Unemployment. How Should She Handle the Situation?

KELSEY WAS DRIVING along a snowy country road en route to her third store location to help her manager, Mark, with a big delivery that was coming in. As she sang along with the music in her truck, her phone rang, and she recognized her accountant’s number on caller ID.

“Hey Joe! How are you? I thought we were talking next week?”

“Hey Kelsey,” Joe said. “We are set for our call next week, but I got the unemployment application that came through for John Smith and wanted to know if —”

Kelsey interrupted: “Unemployment papers? What do you mean? He still works for us — he is at the Southtown location right now.”

Before Joe could answer, Kelsey said, “Joe, I am almost at our other store, let me call you back when I get there.” With her mind racing, she could not understand what was happening. This has to be a mistake, Kelsey thought to herself. Who would apply for unemployment while still working?

John had worked part-time for Kelsey for almost two years, and, while he had some issues — being late sometimes and health problems — he still did a good job when he was there. She could not think of a reason why he would do this, although she knew he was on medical assistance. She even drove him to the doctor a few months ago when he had no way to get there.

Kelsey pulled her truck into the parking lot at the Northtown store, and Mark waved to her.

“Morning, Mark,” she said. “Listen, I have to make a call — I will come up front to help you in a few minutes.” She rushed to the office door and immediately dialed Joe.

“Hey Kelsey, so he still works there?” Joe said. “This is bizarre. He apparently applied for unemployment insurance saying that he was terminated a few weeks ago, by you.”

“I mean, I can pull up the cameras right now,” Kelsey said. “He is working — how is this even possible? I pay him by check, he is on our payroll, I certainly did not fire him, and he has only ever worked part-time for us!”

“I am not sure,” Joe said. “I can email everything to you so you can look at it, and obviously will not approve it. Seems crazy — OK, just sent it to you.”

“Thanks, Joe,” Kelsey said. “You are a lifesaver!”

Kelsey reviewed the unemployment application, and, sure enough, John had applied for it. She went on to the website of the unemployment office to try to find a number to call or how to dispute this application. After finally getting someone on the phone, they told her, “You will have to fill out the form and dispute the claim, and since you say they still work for you — write that on the paperwork, as we have no area on the form that says the employee still works for you.”

Kelsey thought it unbelievable that there wasn’t even a box to check off that someone was falsely claiming unemployment.

Kelsey didn’t want to mention anything to Mark since it was a different store. John didn’t work under his authority, but she really needed feedback. So, she called her friend who was a store owner in another town. After explaining what was going on, Kelsey asked her friend, Martha, “I feel so betrayed. I have helped this guy so much — and I can’t get a straight answer from the unemployment office on how to handle this. What would you do?”

Sheila R.
Arlington, VA

I would just ask the employee directly. In some states, you can file for unemployment if hours were reduced, so it could be totally legitimate. If the employee says it wasn’t him, then together we would call the unemployment office. If it was him, and it is a fraudulent claim, I would fire him and then fight the new claim with all the facts about him trying to file a fraudulent claim.

Doug S.
New City, NY

The employee would be terminated on the spot because filing a false unemployment document is dishonest and illegal.

Marcia C.
Springfield, VA

Contact the unemployment commission and complete its paperwork. If you can get a person on the phone, ask if a fraudulent claim can be grounds for dismissal. If so, fire him! If it’s not, meet with John immediately. You may discover that the unemployment commission made an error. Or, he may confess that he’s filed a fraudulent claim. If there is no error and he did file, you don’t want him as an employee. Change his work assignments to ensure he’s not responsible for money, orders, company credit cards. Take his building key, access to social media accounts, and don’t schedule him for any shifts where he would be alone in your store. And tell him why you’re doing it. He may quit. And no unemployment for him if he quits. Start a performance notes document — customer complaints, poor interactions with staff, late arrivals, unplanned absences. This is your backup if he files again.

Molly T.
Houston, TX

My sister had been laid off from her full-time job. She just helps me on occasion on the weekends when she is available. She has been doing that for at least five years, so I just keep her on payroll. She filed for unemployment due to being laid off from her full-time job. It came down on me as well. I disputed it twice, and they still honored the claim on me. Crazy. I am telling the lady on the phone that she is my sister and still has a job with me and the lady did not care. It was the most bizarre thing. It is the only claim I have ever lost!

Dawn T.
Vero Beach, FL

To handle this, I would approach this situation with the employee falsely claiming unemployment by bringing them in and just giving them a performance review as well as allowing them to have the opportunity to “review” you and the store. This will be proof he works there as well as if he is happy or unhappy. As a previous business owner, I have handled similar unemployment claims and now assist others to help against false claims. To deal with the employee in this scenario, I would not treat him any differently because you don’t want other cases to be bought up against you such as discrimination due to his health or such.