Oklahoma employer beware: Fraudulent unemployment claims on the rise
Unemployment filings in Oklahoma, and elsewhere, are at an all-time high due to the coronavirus pandemic. The Oklahoma Employment Security Commission (OESC) recently stated that is has paid more than $432 million in unemployment claims in the past six weeks alone. That’s more than was paid in all of 2019.
Not only has the amount of unemployment claims increased, but some of the rules have recently changed, too. For instance, Governor Stitt suspended the one-week waiting time for employees to receive unemployment benefits and temporarily waived the work search requirements for benefit recipients. Benefit wage charges to employers will also be waived for claims directly related to the COVID-19 pandemic and, thus, unemployment taxes will not be charged to employers for those claims. The federal CARES Act also increased the amount unemployed individuals can receive, the length of time that benefits are available, and who is eligible for benefits.
That is all good news for those suffering from the economic impact of this pandemic. But with so many individuals relying on these expanded benefits, it has unfortunately caused an increase in fraud. Employers should be on the watch for fraudulent claims, especially during a time when employers may not be monitoring unemployment notices as close as they normally would.
The OESC has discovered and stopped nearly 4,000 fraudulent claims since the pandemic started, and more may have been filed and not detected. It’s certainly in the employer’s best interest to report and try to reduce unemployment fraud. While employers may not be directly charged for benefits paid now, the increasing number of fraudulent claims could result in overall higher unemployment tax rates and harm employees that are legitimately seeking benefits.
Best practices for reducing fraud
Here are a few tips on how employers can help reduce fraud:
- Create a streamlined approach or designated official to receive all notices of unemployment filings. Many employers already have a designated person in charge of handling unemployment claims, but with the number of new claims being filed, it’s possible, if not likely, that these may be misdirected. Other managers at the company should know to whom they should pass any unemployment notices they happen to receive.
- Review notices of unemployment filings. This is especially true if the employer has laid off a groups of individuals or it is clear that its employees are not working. Employers may have no intention to contest benefits, but they should conduct a review to confirm the notices are for individuals that actually worked at the company. Employers that use a professional employer organization or outsource unemployment filings should be in contact with the PEO about any layoffs of furloughs and ensure claims are being handled correctly.
- Immediately contact the OESC if you suspect a fraudulent claim. Filing fraudulent claims has always been illegal in Oklahoma, and the OESC has long had the Internal Audit Department to help combat fraud. This fraud unit can be contacted at firstname.lastname@example.org.
Employers have a lot to deal with now, but by following these tips, employers can help reduce fraud. And helping reduce fraud helps everyone.
Philip R. Bruce(405) 552-2390