Sen. Lanane has introduced SB 42 concerning unemployment insurance overpayments made by mistake of the Department of Workforce Development. “Overpayment” refers to an unemployment payment the former employee receives that he or she should not have. For example, sometimes an overpayment results from the individual claiming that they were not terminated for just cause while the employer claims that the termination was for just cause. During the pendency of the litigation over the question, the individual might be receiving unemployment benefits. If the person is ultimately deemed ineligible to receive those benefits; the payments that were made incorrectly are deemed to be “overpayments” and the individual is required to pay that money back.
Under current law, the department is permitted (but not required) to waive repayment if the benefits were received by the individual without fault of that individual; were paid during the pendency of an appeal to an ALJ or the Review Board or due to an error by the employer or department; and repayment would cause economic hardship to the individual. This waiver does not apply in the cases of individuals who worked for an employer who “makes payments in lieu of contributions.”
This “payments in lieu of contributions” business requires some explanation. The default system is that employers make “contributions” to the unemployment system. It’s not dollar-for-dollar. It’s according to a formula and it’s more like an insurance policy. Some employers are eligible to elect to make “payments in lieu of contributions.” This is a dollar-for-dollar payment plan. The Department of Workforce Development just acts like a pass-through. The employer puts the money into an account. The Department takes the money from that account and gives it to the former employee.
Sen. Lanane’s bill would (in the case of errors by the Department) make waiver of repayment by the former employee receiving a windfall mandatory instead of discretionary and would apply in the case of both employers making contributions and employers making payments in lieu of contributions. This sounds like an awful deal for employers making payments in lieu of contributions – the department makes a mistake, takes your money and gives it to a former employee who wasn’t entitled to benefits, and now you can’t get your money back.
Curious what the reality is of collecting the overpayments. Is it a case where more money is being sent trying to get it back then is actually recaptured?
And as I have pointed-out numerous times before, DWD makes numerous errors (worst of any state in the country over the last 7 years) that have gravely affected employers throughout the state. The employers who are “in lieu of contributions” employers are very rarely private sector; usually those employers are government employers. When people mistakenly say taxpayers don’t pay for unemployment, I correct them because taxpayers do indirectly pay for those unemployed by government. This bill would potentially therefore indirectly affect taxpayers. If DWD would actually do it’s job correctly then the state senators and representatives wouldn’t have to keep introducing bills to change the UI system so drastically.
Why Joe Hogsett and or the US Department of Labor refuse to investigate and reign in DWD is a mystery to many! It is even more interesting that Ron Stiver who was the first commissioner of DWD installed by Mitch Daniels has escaped public scrutiny for his role in destroying DWD!
A better option would be to remove this whole thing altogether. Are you unemployed? Then you’re guaranteed a decent income regardless of why or what you’re doing about it. This way, people wouldn’t be forced to stay in shitty-assed jobs they’re unsuited for and which make them absolutely miserable, just to survive.
It’s people that matter, not maxing out economic production–and certainly not some freedom-hating reactionary’s perverse and backwards idea of “justice” (justice is important, but what the freedom-hating reactionaries call “justice” is usually anything but).