Hiring Mistakes That Can Cost You: How We Beat a False Unemployment Claim

The Hire That Went Sideways (Faster Than We Thought)

We’ve made a lot of hires over the years. Some were great. Some were “okay.”
And then there was this guy.

We hired him for a mid-level role. He interviewed well. Had solid experience. Asked for a few things up front, a flexible start time, some tweaks to the onboarding schedule. We accommodated it all. We were trying to be the kind of employer we’d want to work for.

He accepted the offer. Day one came. Day two... didn’t.

Enter: Immediate Medical Leave

Just days after onboarding, he let us know he was going on medical leave.

No problem, life happens. We were understanding, flexible, supportive. We offered to keep things open while he got what he needed.

Weeks went by. Minimal contact.
Eventually, we got a message: he was quitting.

No drama. Just done.

We chalked it up to a mismatch, moved on, and posted the job again.

Then the real surprise hit our inbox.

The Unemployment Claim

A few weeks later, we received a notice from the state:
He was filing for unemployment.
Claiming he had been let go.

It’s one thing to lose a new hire. It’s another to have that person try to collect unemployment benefits after quitting voluntarily.

We weren’t thrilled. But we also weren’t unprepared.

How We Won the Dispute (And Why You Need Receipts)

Fortunately, we had documented everything. Most importantly:

📱 A screenshot of a text message where he clearly said he was quitting.

We submitted that screenshot in our response to the unemployment claim, along with the timeline of events and a copy of his signed offer letter.

The state reviewed the documents. Within a couple of weeks, we got the decision:
Claim denied. We won.

Had we not kept that record?
We might’ve been on the hook for hundreds, even thousands, in unemployment fees.

Lessons Learned (The Hard Way)

Hiring is always a gamble. But there are ways to reduce your risk.

Here’s what we do now, and what we recommend for every small business owner:

Document Everything from Day One

Even if you trust the person, keep a written record of:

• Offer letter and start date
• Any adjustments, accommodations, or schedule changes
• Communications during onboarding (texts, emails, DMs)
• Any notice of resignation or intent to leave

You never know what you’ll need to prove, and you may need to prove it months after the person is gone.

Use a Standard Resignation Acknowledgement

We now ask employees to submit resignation in writing or reply to an official email confirming their intent to resign. Something like:

“This is to confirm your resignation effective [date]. Thank you for your time with us.”

This closes the loop on any “they let me go” ambiguity.

Save Texts, Emails, and Call Logs (Yes, Even the Petty Stuff)

That one text you think is no big deal?
It might be the only thing standing between you and an incorrect unemployment claim.

Save it. Screenshot it. Archive it in the employee’s file.

Know the Rules in Your State

Unemployment laws vary by state, but most states only grant benefits if the employee was laid off, let go without cause, or left due to good cause attributable to the employer (not just “I didn’t like it”).

If someone quits voluntarily, they usually don’t qualify, but you need to prove that they quit.

Be Generous, But Guarded

We still believe in giving people the benefit of the doubt. Medical leave? We get it. Life is unpredictable.

But being generous doesn’t mean being naive. Protect your company with good policies, signed documents, and a digital paper trail.

Red Flags We Watch for Now

Hiring mistakes happen, but we’ve learned to be cautious when we see:

• Over-negotiation before they’ve even started
• Vague answers about availability or medical concerns with no dates
• Unresponsiveness during onboarding
• Last-minute “emergencies” followed by silence

These aren’t automatic dealbreakers, but they’re reasons to slow down, document everything, and ask more questions.

HR for Small Teams Means Wearing Legal Goggles

If you don’t have an HR department, you are the HR department.

• Build a basic employee file for every hire
• Keep all correspondence centralized
• Save call summaries or Slack conversations as PDFs if needed
• Use cloud storage with labeled folders by employee name

A few minutes of admin work now can save weeks of frustration later.

The Bottom Line: Hire Carefully, Document Religiously

We’re not bitter. Okay, we were a little bitter. But now we’re smarter.

Hiring regret is part of running a business. What matters is learning from it and putting systems in place so it doesn’t burn you twice.

Because in small business, a single unemployment claim can cost you time, energy, and money, unless you’re ready.

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