First Person: How I Prevented Unemployment Claims as a Small Business Owner

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No small business owner wants to lose an unemployment compensation claim. Even in "at-will" states such as Ohio, it is possible for someone to quit a job and be awarded unemployment compensation.

Many years ago, I closed my business and my employees rightfully received unemployment. Later, as an operations manager for a business with around 50 employees, I learned the necessary steps to take in order to successfully terminate an employee and not lose the claim.

Establish a written policy

Our company had an employee handbook and each employee had to sign a receipt that they received it and understood they were responsible for reading it. It doesn't mean I didn't hear "I didn't know about that rule" more than once, but the receipt put the burden on the employee.

We included a detailed guide to the penalty phase of violating company guidelines, from a verbal warning to termination. Some offenses, such as drug or alcohol use on company time, could lead to immediate termination without a warning.

Written communication

I kept every e-mail I sent and received, including some rather irate employee missives. If an employee needed a warning and I wouldn't be able to see them face to face, I sent an e-mail and copied it to upper management. Then, when I did see the employee, I presented a copy of the e-mail notifying them of the infraction along with the written warning. We required our employees to sign a copy of every warning and it was kept in their file.

Be consistent and follow the guidelines

I found myself saying more than once "it's not personal, it's business" when an employee complained about unfair treatment. A small business has to set guidelines just as the large mega-corporations do. Even-handed enforcement of the rules, no matter how trivial, will go a long way toward winning an unemployment claim.

If an employee commits the same violation within weeks of a warning, it is a sign of trouble. I had to be strong enough to follow our disciplinary process and document each occurrence.

Details at termination

When it became necessary to fire an employee who happened to live 2,000 miles from me, I was in a unique situation. It was too costly to fly to their location to deliver the termination notice, so my supervisor and I determined that I would notify the employee in writing via e-mail, detailing the reasons he was no longer welcome to work for our company. I then phoned him to tell him.

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