• Errors Contributing to Improper Unemployment Benefits Being Paid
  • October 18, 2011 | Author: Edwin S. Hopson
  • Law Firm: Wyatt, Tarrant & Combs, LLP - Louisville Office
  • The U.S. Department of Labor reported on its website that it has been working with states to identify strategies to prevent overpayments that have become significant.

    According to the Department, improper Unemployment Insurance benefit payments have been occurring when:

    1. Recipients continue to claim benefits after returning to work;
    2. Employers or their third party administrators do not submit timely or accurate separation information; and
    3. Claimants fail to register with the state’s Employment Service as required by state law.

    The amounts involved are large.  For instance, the error rate according to the Department in the following states involves the amounts set out below for the last three years in the aggregate:

    California          6.5%    $1.6 billion

    Florida             6.8%    $479 million

    Illinois               12.7%  $1.2 billion

    Indiana             43%     $1.7 billion

    Kentucky         4.3%    $90 million

    Louisiana          43.6%  $497 million

    Michigan          8.8%    $640 million

    Ohio                 16.3%  $866 million

    New York        8.2%    $962 million

    Texas               12.6%  $1 billion

    Earlier this year, the Department states that it intervened with the ten states with the highest registration error rates to focus on the issue.  As a result, progress reportedly is being made, with a 23% reduction in improper payments to people who did not register with employment services agencies, including a more than 35% drop in eight states.