8 Tips to Choose the Best Unemployment Claims Vendor
Posted by Ross Henderson on Tue, Feb 21, 2012 @ 07:30 AM
Considering replacing your current “in-house” unemployment insurance (“UI”) program with a more efficient/cost effective solution? Or, are you approaching contract renewal with your current vendor and considering options? Since there is a real employment tax impact here, wouldn’t you want to arrive at an informed decision based on facts? Consider the 8 points below to help you find the best Unemployment Claims Vendor for you!
1. Where are you now?
Understanding your current program and results benchmarks effectiveness. Does your current solution track the following totals?
- separations
- claims
- % of protestability
- untimely response
- late claims
- wins/losses
- appeal hearings
- employer generated appeals
- compliance (UI Integrity Rules - Jan Update)
2. Are activity reports effectively measuring program results?
- ease of access
- automatically delivered or requested
- current/historical
- frequency
- proactive or reactive
- basis of analysis
- customization
- determine corrective action
3. Employment Tax Expertise
What is the depth of the vendor’s employment tax practice? What is the vendor’s direct experience of employment tax issues beyond processing unemployment claims like handling unique issues such as audit representation, mergers & acquisitions or penalty abatement?
4. Your Team
Who is on the “dedicated” team managing your account? What is their degree of proficiency, level of “enthusiasm/passion”? Will the vendor’s team’s culture benefit and improve your HR & Payroll Teams?
5. Service, service, service
Most vendors will claim “great service,” but performance is what counts. When considering a vendor, speak with their clients. Are their clients “Raving Fans”*? How does the vendor rate in performance, responsiveness, follow through, process improvement, dedication to total quality management and continual process improvement? And, what is the vendor’s track record with state agencies?
6. Timeliness
UI is measured in days, hours and minutes. Timeliness, appropriateness and accuracy are fundamental deliverables. What is the vendor’s track record for claims “lost” due to timeliness issues? What is the vendor’s attitude toward this critical topic?
7. Integration
Although UI can be a “stand-alone” solution, it is often bundled with other related/complementary services, thus taking advantage of “pooled” related data, vendor’s technology and expertise. Does the vendor offer verification of income & employment ("VOIE"), electonic I-9 / E-Verify, WOTC / hiring-based tax credits and/or technical employment tax consulting?
8. Return on Investment (ROI)
The typical UI fee is a small percentage of a company’s overall payroll/unemployment tax expense. An effective UI vendor creates savings exponentially higher than an annual fee. By increasing protestability and resultant win rate, UI vendor service fees become insignificant.
Epilogue
You can focus on the lowest fee and “pay for what you get.” But, what if your preferred business partner has a vision for your company’s future? What if your partner were to increase compliance, protest more claims, win more protested claims, accelerate/propel “win ratio” through the roof and consistently deliver a high return on investment?
*Raving Fans, “a revolutionary approach to customer service”, co-authored by Kenneth H. Blanchard and Sheldon M. Bowles, (Morrow, 1993)
Posting co-authored by Barry Bagus and Ross Henderson (Employment Tax Specialists, Inc.).
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