May 11 - 17, 2007

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Health Care and Workplace
On a mission to curb unemployment fraud
By Cristina Rodriguez / Staff Writer

Ellen Brown, an investigator with the Nevada Department of Employment, Training and Rehabilitation, works on a case at DETR offices.
Photo by Steve Marcus

Like auto insurance, the cost of unemployment insurance rises in proportion to the number of claims.

And like drivers, human resources professionals can watch out for one another.

The state Department of Employment, Training and Rehabilitation has a new effort to stop unemployment fraud. It focuses on the day that an individual starts a new job, when an HR official can say a few words during orientation and maybe have a poster up in the office.

DETR finds that most fraud is committed through an innocent mistake - or at least can be made to appear that way - and can be mitigated by simply providing info.

"Where there tends to be confusion is if you start work this Monday but you don't get your first check until two weeks from now," said Cynthia Jones, the department's Employment Security Division administrator.

Even though it hurts, workers are obligated to cancel their checks for those two weeks.

Not doing so is a prime reason why the state overspends by an estimated $1 million a year. That's a relatively small number compared with the $350 million in unemployment benefits given per year, or compared with the $750 million unemployment trust fund, officials say.

But it is money the state wants to protect in case of a heavy economic downturn, like the one that followed the terrorist attacks of 9/11.

Nevada officials in April hosted a Fraud Prevention Conference in Las Vegas with the Department of Labor. The event brought together 60 representatives from 18 states to talk about how to prevent identity theft and how to best resolve fraud cases.

Nevada shared details on its HR-geared effort, which is run through its new Integrity Programs Section that opened last July.

Employer taxes for unemployment insurance are based on employee payroll. The average rate is 1.4 percent on the first $24,600 of wages paid each year. But individual employer tax rates can range between 0.25 percent and 5.4 percent depending on how often and for how long former workers collect benefits.

The benefits for eligible workers range from between $16 and $362 per week. Calculations are based on previously earned wages.

The posters that HR offices are encouraged to hang can be obtained by calling DETR's Integrity Programs division at (775) 684-0475.

Those warnings are not meant to be scary or intimidating, Jones said, but they do talk about penalties. Depending on whether the fraud was intentional or unintentional, a person may be forced to repay benefits, may be disqualified from receiving benefits in the near future or may face criminal prosecution.

The same division also offers free employer training that helps companies bring down high UI tax rates. Training now is by appointment, but in the future leaders will conduct public sessions, Jones said.

She also cautioned against giving out employee personal information over the phone. In the worst-case scenarios, the caller could be someone trying to stalk a former spouse or steal somebody's identity.

To guard against this, make sure that there is a reason why a caller might be asking for information: For example, was an unemployment claim recently filed? Asking for a name and callback number also works, Jones said.

  • In other workplace news, the law firm Fox Rothschild is offering free seminars on immigration May 24-25 at Cili Restaurant.
  • Sessions will cover how to guard against immigration raids and information on visas. To attend or to get more information, contact Kathleen Hellriegel at khellriegel@foxrothschild.com.

    Cristina Rodriguez covers medical and workplace issues for In Business Las Vegas and its sister publication, the Las Vegas Sun. She can be reached at (702) 259-2326 or by e-mail at cristina.rodriguez@lasvegassun.com.

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