From Rep. Cutler and Sen. Jehlen, Chairs of the Joint Committee on Labor and Workforce Development:
We appreciate the Baker Administration’s timely report to the Legislature detailing the status of state and federal unemployment overpayments.
One glaring data point revealed by this report is the impact on lower-income earners. More than half of current overpayment cases are individuals with less than $27,800 in earnings. This includes 138,000 receiving federal benefits and another 65,000 on state unemployment assistance.
The Administration’s recent request for authority to waive all non-fraudulent overpayments for federal unemployment programs is a welcome step. As Secretary Acosta correctly observed, the waiver review process is laborious and frustrating and can create obstacles, particularly for communities hardest hit by the pandemic.
This logic applies equally to state and federal overpayment collections. Despite the laborious process, the Administration expects to recover in only about one in ten cases. Measuring the additional costs of collection against a low expected recovery rate raises concerns that we are chasing pennies with dollars. Enforcement efforts should be focused on fraudulent cases, not repayments from individuals who would otherwise be eligible for a waiver.
Moving forward, we will continue to work with the Department and our colleagues in the Legislature to ensure we remain responsible stewards of our UI trust fund, while also seeking solutions for our neediest residents facing the burden of repaying a debt that may be no fault of their own.