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U.S. DEPARTMENT OF LABOR
Employment and Training Administration
Washington, D. C. 20210

CLASSIFICATION

UI

CORRESPONDENCE SYMBOL

TEUQC

ISSUE DATE

April 30, 1993

RESCISSIONS

None

EXPIRATION DATE

April 30, 1994

DIRECTIVE

:

UNEMPLOYMENT INSURANCE PROGRAM LETTER NO. 25-93

 

TO

:

ALL STATE EMPLOYMENT SECURITY AGENCIES

 

FROM

:

BARBARA ANN FARMER
Administrator
for Regional Management

 

SUBJECT

:

Options for Assessing Benefit Charging Accuracy

  1. Purpose. To solicit comment on options for assessing the accuracy of benefit charges through the Revenue Quality Control (RQC) program.

  2. References. UIPL 44-90 (September 21, 1990)

  3. Background. Charging a UI benefit to the appropriate employers' accounts involves two determinations: determining whether an employer should be charged for benefits paid under the claim in question; and allocating the benefit amount between the accounts of chargeable employers and the general pool account. Core RQC reviews the accuracy of both determinations as part of its program review of a SESA's tax accounting function.

    A Department of Labor Office of Inspector General study of experience rating raised the concern that employers might be systematically evading benefit charges by alleging that the claimant had quit or otherwise left for nonchargeable reasons. As a result, UI tax rates might be insufficiently experience rated. In response RQC pilot tested a more thorough examination of Benefit Charging accuracy, including a verification of the accuracy of employer responses to notices of potential benefit charge. The results of that pilot test, conducted in six States for 9 months during 1991, are summarized in the attached paper. The paper also identifies options for assessing the accuracy of benefit charges in the future. The Department seeks comments on these options before deciding whether to go beyond, at some future date, the present Core RQC review.

    The final evaluation report on the Benefit Charging pilot was received from Abt Associates, Inc., in January 1993. Copies of this report, "Unemployment Insurance Revenue Quality Control: Benefit Charging Pilot Project" are available on request.

  4. Action Requested. State Administrators are requested to (a) provide comments to the appropriate Regional Office on the attached options paper 45 days from date of release of this UIPL, and (b) forward to the National Office (Attn: TEUQR) any benefit charge studies done within the past 5 years that might be helpful in considering these options.

  5. Inquiries. Questions should be directed to the appropriate Regional Office.

  6. Copies of the Abt Evaluation Report. Copies are available upon request from Burman Skrable, ETA/UIS/OQCI, 200 Constitution Avenue, N.W., Room S-4015, Washington, DC 20210, (202) 219-5220.

  7. Attachments. Options paper, "Options for Reviewing Benefit Charging Accuracy."