The current crisis of unemployment compensation has overwhelmed a system never designed to handle almost 1.3 million initial claims in nine months – a volume 12 times greater than normal. Due to these unprecedented numbers, the premature issuance of overpayment determinations hinders rather than helps the process.
The VEC is creating some of its own problems by prematurely issuing overpayment determinations. Until early 2020, the VEC’s policy was not to send out overpayment notices until 37 days after a determination or decision finding a claimant ineligible or disqualified to receive benefits previously paid. This was the proper procedure because the determination or decision is not final until the 30 day appeal period has run.
Earlier this year before the pandemic, the VEC changed this policy and started sending the overpayment notices within a week, in one case of mine four days, after the determination or decision. This creates unneeded extra work for the Collections Unit. This also confuses clients, because the appeal deadline on the overpayment notice is later than the deadline on the determination or decision finding a claimant ineligible or disqualified. Claimants incorrectly believe the later appeal deadline applies to the determination or decision, which it does not.
At least two of my clients have missed the appeal deadline on the determination or decision, but did make the appeal deadline on the overpayment. The prematurely issued overpayment notice ought to constitute good cause for a late appeal on the determination or decision.
In addition to creating unneeded extra work for the Collections Unit and confusing claimants, this new policy is unnecessarily slowing down the First Level Appeals process. Last month I learned that if an overpayment has been prematurely declared and a timely appeal has been filed, the Appeals Examiner hearing is not scheduled until First Level Appeals has received from the Collections Unit all of the information about the unneeded prematurely declared overpayment. This adds substantial time until an Appeals Examiner hearing is scheduled.
Lastly, I learned last month there are 46,000 pending appeals at the First Level Appeals. Last I heard, the VEC has only 23 Appeals Examiners capable of handling about 575 appeals per week. If this still is the case, the backlog now is 80 weeks – more than one year.
Whenever the issue of prematurely issued overpayment determinations is raised with VEC staff, they will agree the policy is wrong, but the policy remains. One justification raised was a requirement from the U.S. Department of Labor to issue overpayment determinations as soon as possible. However, the most recent guidance I could find from DOL – UIPL No 01-16 Change 1 provides that:
"Unless prohibited by state law, the state may take action(s) to recover the overpayment once the determination has been issued to the claimant. States are permitted, but not required, to wait until the determination is final (i.e., all appeals have been exhausted or time to file an appeal has run out) before initiating recovery."
My suggestion is that the VEC simply revert to the prior policy not to send out overpayment notices until 37 days after a determination or decision which finds a claimant ineligible or disqualified to receive benefits previously paid.
The current crisis of unemployment compensation has overwhelmed a system never designed to handle almost 1.3 million initial claims in nine months – a volume 12 times greater than normal. Due to these unprecedented numbers, the premature issuance of overpayment determinations hinders rather than helps the process. The VEC is creating some of its own problems by prematurely issuing overpayment determinations. Until early 2020, the VEC’s policy was not to send out overpayment notices until 37 days after a determination or decision finding a claimant ineligible or disqualified to receive benefits previously paid. This was the proper procedure because the determination or decision is not final until the 30 day appeal period has run. Earlier this year before the pandemic, the VEC changed this policy and started sending the overpayment notices within a week, in one case of mine four days, after the determination or decision. This creates unneeded extra work for the Collections Unit. This also confuses clients, because the appeal deadline on the overpayment notice is later than the deadline on the determination or decision finding a claimant ineligible or disqualified. Claimants incorrectly believe the later appeal deadline applies to the determination or decision, which it does not. At least two of my clients have missed the appeal deadline on the determination or decision, but did make the appeal deadline on the overpayment. The prematurely issued overpayment notice ought to constitute good cause for a late appeal on the determination or decision. In addition to creating unneeded extra work for the Collections Unit and confusing claimants, this new policy is unnecessarily slowing down the First Level Appeals process. Last month I learned that if an overpayment has been prematurely declared and a timely appeal has been filed, the Appeals Examiner hearing is not scheduled until First Level Appeals has received from the Collections Unit all of the information about the unneeded prematurely declared overpayment. This adds substantial time until an Appeals Examiner hearing is scheduled. Lastly, I learned last month there are 46,000 pending appeals at the First Level Appeals. Last I heard, the VEC has only 23 Appeals Examiners capable of handling about 575 appeals per week. If this still is the case, the backlog now is 80 weeks – more than one year. Whenever the issue of prematurely issued overpayment determinations is raised with VEC staff, they will agree the policy is wrong, but the policy remains. One justification raised was a requirement from the U.S. Department of Labor to issue overpayment determinations as soon as possible. However, the most recent guidance I could find from DOL – UIPL No 01-16 Change 1 provides that: "Unless prohibited by state law, the state may take action(s) to recover the overpayment once the determination has been issued to the claimant. States are permitted, but not required, to wait until the determination is final (i.e., all appeals have been exhausted or time to file an appeal has run out) before initiating recovery." My suggestion is that the VEC simply revert to the prior policy not to send out overpayment notices until 37 days after a determination or decision which finds a claimant ineligible or disqualified to receive benefits previously paid.