What Happens When a Former Employee Files for Unemployment
When someone who worked for you files an unemployment claim in Minnesota, the state does not just take their word for it. You have 10 days to respond with separation information and raise any eligibility issues. What you say in that window matters. If you miss it, you lose most of your ability to contest the claim.
This guide walks you through the entire process from the moment you get the notice.
First: Understand How Unemployment Works
Unemployment benefits are funded by the payroll taxes you already pay each quarter. When a former employee collects benefits, and they are charged to your account, your tax rate can go up over time. That’s why responding accurately to every claim is worth the effort, even if you expect the person to be approved.
Most employees have the right to file for unemployment when they are out of work through no fault of their own. This includes employees who were laid off and also those terminated for poor performance. Only employees who voluntarily resigned without good reason or were terminated for disciplinary misconduct are not eligible.
Knowing which category your situation falls into before you respond is the most important thing you can do.
Step 1: Set Up Your UI Employer Account (If You Haven’t)
Minnesota requires any individual or organization that pays covered wages to register with the Minnesota Unemployment Insurance Program before the due date of their first quarterly wage detail report. Everything in the claims process runs through your account at uimn.org. If you are not registered, start there.
You also need to display the current “Unemployed?” poster in a prominent place in your workplace where employees can easily see it. A free poster is available through uimn.org and comes in several languages.
Step 2: Respond to the Notice Promptly
When a former employee files a claim, DEED will send you a notification through your employer account. Employers must respond quickly. Missing a deadline can weaken your position or result in an automatic ruling against you.
You have 10 days to respond with separation information and raise any eligibility issues. Do not let this slip.
In your response, you need to explain the circumstances of the separation. The key questions are:
- Did the employee quit or were they let go?
- If they quit, did they give a reason?
- If you let them go, was it a layoff due to lack of work, poor performance, or a specific act of misconduct?
Be factual and specific. Vague responses do not help your case.
Step 3: Know What Disqualifies a Claim
Not every claim results in approved benefits. Employees who quit without a good reason caused by the employer are not eligible. Employees discharged because of employment misconduct are also not eligible. Employment misconduct means intentional, negligent, or indifferent conduct that seriously violates the standards of behavior the employer has the right to reasonably expect.
Examples that may support a misconduct finding include repeated policy violations after written warnings, theft, dishonesty, or serious insubordination. Poor performance alone, without evidence of intentional conduct, generally does not qualify as misconduct under Minnesota law.
If you believe the claim should be denied, state the specific reason clearly and include supporting documentation.
Step 4: Submit Supporting Documentation
Employers should provide documentation such as termination letters, performance records, and any prior warnings issued to the claimant.
This is where your internal records matter. If you have written documentation, send it. If the termination was verbal with no paper trail, you are relying entirely on your word against theirs. This is one of the biggest reasons it’s worth documenting performance issues and disciplinary conversations in writing, even at small businesses.
Relevant documents to gather and attach:
- The employee’s job offer letter or any written employment agreement
- Any written warnings or performance improvement plans
- Records of attendance or conduct issues
- The termination letter, if one was issued
- Any policies in your handbook that the employee was warned about
Step 5: Wait for the Determination
After you and the employee have both submitted information, DEED will issue a written determination. If either party disagrees, they have the right to request an appeal, which must be filed within 45 calendar days of the date the determination is mailed.
Do not ignore the determination letter. Read it carefully and note the appeal deadline printed on it.
Step 6: Appeal If You Disagree
If the determination goes against you and you have a reasonable basis to contest it, file an appeal before the deadline. Appeals can be filed electronically, by mail, or by fax. All benefit determinations include instructions on how to file.
After an appeal is filed, a date and time will be scheduled for a telephone hearing with an Unemployment Law Judge. Both you and the former employee will be notified and may participate.
Prepare for the hearing the same way you would prepare for any factual dispute: know your timeline, have your documents ready, and be prepared to explain clearly what happened and why it matters.
Common Mistakes Employers Make
Not responding at all
This is the most common and most avoidable mistake. If you do not respond within the 10-day window, DEED makes its determination without your side of the story.
Responding without documentation
Saying “they were fired for misconduct” without any written evidence to back it up is rarely enough. Document discipline in writing while it is happening, not after the fact.
Confusing poor performance with misconduct
In Minnesota, these are legally different things. Poor performance without intentional or indifferent conduct generally does not disqualify a claim. If you terminated someone for performance and expect the claim to be denied on misconduct grounds, verify that distinction before filing your response.
Missing the appeal deadline
Deadlines play a critical role in this process. Missing a deadline can weaken your position or result in an automatic ruling against you. Put the deadline on your calendar as soon as the determination arrives.
The Role Your Handbook Plays
Your employee handbook is often the most important piece of documentation in a contested unemployment case. If it contains clear, written policies on attendance, conduct, and disciplinary procedures, and you can show the employee was aware of those policies, your case is much stronger.
If your handbook has no conduct policies, no disciplinary process, or has not been updated recently, that gap can hurt you in a claim dispute. KushHR’s Minnesota Employee Handbook template includes a conduct and discipline policy section built specifically for cannabis businesses, so your expectations are documented before you ever need them.
Quick Reference Checklist
- Register for a UI Employer Account at uimn.org if you have not already
- Post the “Unemployed?” poster in a visible location at your workplace
- When a notice arrives, respond within 10 days with accurate separation details
- Identify the separation type: layoff, resignation, performance termination, or misconduct
- Gather supporting documentation: warnings, termination letter, attendance records, handbook policies
- Submit your response and documentation through your employer account
- Review the determination letter and note the appeal deadline
- If you disagree with the outcome, file your appeal before the deadline printed on the letter
- Attend the appeal hearing if scheduled, with your documentation ready