North Carolina's unemployment rate recently reached 7.9%, its highest level in 25 years.  The national unemployment rate stands at 6.7%.  The U.S. Bureaus of Labor Statistics reports that for November 2008, North Carolina recorded the second largest month over month employment loss in the country, with 46,000 jobs lost and the highest month over month job loss on a percentage basis, 1.1%.  Also, economists recently confirmed that the U.S. economy has been in a recession since December 2007.  There are more people seeking fewer jobs than at any time in the recent past.  Many of the unemployed are seeking benefits from the North Carolina Employment Security Commission (ESC) while they look for work.  

The current high rate of unemployment has triggered the provisions of N.C. Gen. Stat. § 96-12.01, which allows unemployed workers to seek extended employment benefits in periods of high unemployment.  Normally, unemployed workers may obtain a maximum of 26 weeks of unemployment benefits.  The extended benefit provisions allow eligible unemployed workers to get up to an additional 13 weeks of benefits.  If unemployment continues to rise and exceeds 8%, and certain other conditions are met, the statute would allow for extended benefits of up to 20 additional weeks, rather than the current 13 weeks.   

When a former worker applies for unemployment benefits, the ESC makes an initial determination about whether the benefits should be charged to the employer's unemployment insurance account.  Charging an employer's account may require the employer to pay higher unemployment insurance payments in the future.  If the ESC initially determines that the employer's account should be charged, the employer may appeal this determination and will have a right to be heard at either a telephone or in-person appeals hearing.  In addition to charging normal unemployment benefits, up to 50% of the extended benefit amount paid to a former employee may be charged to an employer's unemployment insurance account.  

Based on the foregoing, employers may want to be more aggressive in contesting initial decisions that award benefits, because the extended unemployment benefit provisions could cause greater than normal amounts being charged to an employer's unemployment insurance account.