Q. Many people have lost their jobs because of lack of work. If my organization terminates an employee for cause, will they automatically collect unemployment compensation insurance from the State of Colorado?

A. No. Generally, employees are terminated because of unsatisfactory work performance. But, it could also be as a result of a safety violation, substance use on the job, insubordination, excessive absences or destruction of company property. Whatever the reason for termination, it is important to document the events or the details regarding the decision. Include names, dates, times and description of the actual events that occurred.

In cases involving a discharge, the employer must prove that the incidents that led to the former employee’s discharge amount to misconduct as defined by the applicable state statute. The employer must show that the former employee’s actions or omissions to act were willful and either actually harmed or had the real potential to have harmed the employer’s organization. Acts of inability to perform, poor judgment and good faith errors will generally not be sufficient to establish misconduct.

If your former employee’s claim is denied by the State of Colorado, they may appeal the decision. That would result in a hearing. The purpose of the hearing is to get as many of the facts relative to the individual’s employment and why he was separated from employment. It’s an opportunity for the employer to get as many of those facts on record as possible. Be prepared to describe the final incident that led to the discharge, discuss prior disciplinary action and relevant company policies or procedures. You must establish the impact or potential impact the former employee’s actions had on your organization. An isolated instance will generally be insufficient to establish misconduct. If the final incident is within the control of the employee or they could have prevented this final incident, this it is a case worthy of pursuing. Some important points to remember:

• Testimony must contain specific details.

• When asked a question, listen to it, consider it, and then answer the question only. If you do not understand the question, ask for clarification.

• Answer questions that are within your knowledge without hesitation and with conviction.

• Do not volunteer additional information. Answer the questions as concisely as possible.

• If you do not know the answer to a question, say “I do not know.”

• Do not speculate or answer hypothetical questions. Testify to the facts within your knowledge.

• Provide a direct response to the question asked without adding additional or irrelevant information.

• Ask for a recess if you need time to collect your thoughts.

• During the hearing, have all documents and employment records accessible to you for quick and easy reference.

Nonprofit organizations with a c-3 designation are not required to participate in the State tax system. If your organization has 15 or more employees, you could save money by placing your money in a trust and only paying for benefits paid to former employees. The Unemployment Services Trust (UST) can help you manage this process and save you money. In addition, you get the benefits of using a claim expert hired by UST. Additional information is available through Nonprofit Resources.

At Nonprofit Resources, our insurance programs offer a wide range of competitively priced packages. Remember, profits earned by Nonprofit Resources are used to support Colorado Nonprofit Association programs. Please contact us when you are purchasing insurance for your organization. You can reach us via phone at 303-894-0298 or toll-free at 866-537-1142.