Verifying Employer Unemployment Fraud
Find the rules for your state. Each state sets their own rules for maintaining unemployment insurance. What may appear to be fraud could be perfectly legal behavior. You can find a link to the appropriate office in each state at http://workforcesecurity.doleta.gov/unemploy/agencies.asp. Common ways employers commit fraud include: Paying workers “under the table” Improperly classifying employees as independent contractors Improperly shifting employee records among various business entities
Ask the employer. Employers also allowed to hire independent contractors or have shared employees. Frequently, you can alleviate concerns simply by asking the person you believe may be committing fraud. They may be reporting accurately, but you don’t see that part of their activities.
Evaluate the circumstances. Even though the person verifies that they are not committing fraud, you may consider reporting anyway if you reasonably believe their response was not truthful. Some things that would be reasonable would be: Observing the work environment and seeing an employer treating an independent contractor as an employee Observing the work environment and seeing fewer actual business entities than are issuing paychecks
Exercise caution with second-hand information. Perceptions can be different from one person to the next, so before making a report based on something you were told, check it out for yourself. If someone comes to you with concerns of unemployment fraud by another person, give them the information to report it on their own.
Verifying Employee Unemployment Fraud
Find the rules for your state. Again, each state sets their own rules for maintaining unemployment insurance. You can find a link to the appropriate office in each state at http://workforcesecurity.doleta.gov/unemploy/agencies.asp. Common requirements for employees include: Former employees must actively search for work while drawing unemployment Former employees may work under some circumstances, but their earnings and hours must be reported to the appropriate office
Observe fraudulent behavior. Common ways a former employer commits fraud include: Earning money from employment that is not reported to the appropriate authorities Knowingly submitting inaccurate job search documents Knowingly submitting an inaccurate application for benefits
Ask the employee. People are allowed to work while drawing unemployment compensation. Frequently, you can alleviate concerns simply by asking the person you believe may be committing fraud. They may be reporting accurately, but you don’t see that part of their activities.
Evaluate the circumstances. Even though the person verifies that they are not committing fraud, you may consider reporting anyway if you reasonably believe their response was not truthful. Some things that would be reasonable would be: Observing a person submit a weekly claim and denying working when you also observed him or her working during that period Observing a person submit a weekly claim stating they looked for work, but knowing they did not. Be aware, however, that internet job searches usually qualify as looking for work. Observing a person submit a weekly claim stating they were available for work, but knowing they were on vacation out of the area that week.
Exercise caution with second-hand information. Perceptions can be different from one person to the next, so before making a report based on something you were told, check it out for yourself. If someone comes to you with concerns of unemployment fraud by another person, give them the information to report it on their own.
Reporting the Fraud
Consider the consequences of a fraudulent report. Knowingly making a false report is a crime in many states. If you have a reasonable belief that unemployment fraud is being committed, you should report it. If it turns out to not be fraud, there should be no repercussions. If, on the other hand, you are angry at someone or don’t like them, and you make a report of unemployment fraud without having any reasonable belief that fraud is actually being committed, you can be criminally prosecuted in some states.
Locate the appropriate office. The US Department of Labor publishes a directory of contact information and/or websites for reporting fraud. This is broken down by reporting fraud by employers or fraud by employees. You can access it at http://www.dol.gov/dol/maps/fraud.htm. Most states will give an option of phoning or faxing in the report or making the report online. Unemployment insurance funds are maintained by the states, not the federal government Keep in mind that each state’s reporting requirements will be different Some states will allow you to make an anonymous report, and some will not.
Call or fax in the report. If you choose to phone in the report, from the site you found above, you should be able to locate a telephone or fax number. The report is nothing formal and does not need to be in writing. It simply involves communicating the necessary information to the appropriate agency you located above. Call that number and provide the following information (either orally or in writing): The person or entity believed to be committing fraud The full address of the person or entity believed to be committing fraud Social Security Number or Employer ID Number if known Phone number if known Description of the fraudulent activity When the activity began
Report online. If you choose to report online and your state provides that option, fill in/answer the questions asked on the form and submit it according to the instructions on the website. The information requested will generally be similar to the above.
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