We are in the process of reorganizing our small business and had to eliminate a position due to low sales and overstaffing. Instead of laying off, the employee was offered a part-time position from full-time in a different department. She verbally accepted. After a week I received a letter from DOL to respond to a separation notice because she is filing for unemployment. She is still working for me at 20 hours/week. How do I respond to this?
What do I do if she resigns? Is the company liable for unemployment tax?
Your questions are somewhat confusing. I am making some assumptions about what you mean and am answering your questions.
1st. Part-time unemployment.
If you have reduced your employee from full time to part time, the employee may be eligible for unemployment.
Partial unemployment insurance claims may be filed by employers for full-time employees who work less than full-time during a pay period due to lack of work only. The employees must still be attached to the employer and must have earned wages that do not exceed the weekly benefit amount plus $50.00.
If the employee quits, then the employee is not normally eligible for unemployment.
Unemployment claims made and paid can cause unemployment insurance fees charged to a company to go up.
Talking with a lawyer can help structure the changes like you are making in the best way to minimize unemployment and other liabilities.
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