Public comments on unemployment

The Department of Workforce Development is having public comments on unemployment scheduled for Thursday, 17 November 2016, from 3-6 PM. There are locations in Eau Claire, La Crosses, Superior, Green Bay, Milwaukee, and Wausau.

Here in Madison, the public hearing is at:

UW-Extension
The Pyle Center
Room DE 235
702 Langdon Street
Madison, WI 

You can also send comments via e-mail message to UILawChange@dwd.wisconsin.gov or via regular mail to:

Janell Knutson, Chair
Unemployment Insurance Advisory Council
P.O. Box 8942
Madison, WI 53708 

Update on UI legislation

Advisory Council Bill AB819
Yesterday, the state senate passed the bill and messaged it to Governor Walker for his signature. This law consists of the following proposals:

  • A second SSDI prohibition, D15-01, to replace the current prohibition was approved in April 2015 and back-dated in May 2015. But, after the Department started winning the court cases challenging the old SSDI prohibition (see this post for the details), this proposal disappeared from the Department’s legislative draft at the council’s September 2015 meeting. But, after the Labor and Industry Review Commission ruled in November 2015 that departmental error had occurred when appeal tribunals (but not the Commission) had originally ruled in favor of claimants regarding dual receipt of SSDI and UI benefits (and so no repayment of UI benefits previously received was proper), this proposal re-emerged at the November 2015 council meeting in the Department’s legislative drafts. Why? This second SSDI prohibition is back-dated to January 2014, the effective date of the original SSDI prohibition.
  • D15-04 sets up essentially a backup insurance program for reimbursable employers who get their unemployment accounts swindled by identity fraud (and so have little to no hope of ever recovering the stolen benefits). The final recommendation from the council was for reimbursable employers to be taxed initially in order to create a fund of $1 million for covering themselves against identity fraud, essentially the second option of the three presented.
  • D15-05 corrects a hole in the statutes that accidentally left LLPs out of the definition of employer (see also this DWD memo on this issue).
  • The Advisory Council approved the Department’s appeals modernization proposal, D15-06, at the 7 January 2016 meeting. LRB draft language was prepped soon thereafter. Perhaps the most significant change in this proposal — notice by Internet in place of postal mail — has NOT received any discussion of comment from council members, however.
  • Proposed changes to the definition of claimant concealment in D15-08 are described in this previous post and described in a Department memo (discussed in this post), Additional criminal penalties for concealment in AB533 passed the Assembly but has yet to be passed by the Senate. To see what all the fuss is about, take a look at this January 21st Assembly Committee on Public Benefit Reform hearing regarding AB533 and other UI bills or read this LIRC memo on the proposed concealment changes. You can see and hear testimony against these concealment changes via this previous post.
  • Technical changes in D15-09 will allow the Department to distinguish able and available determinations from separation determinations.
  • D15-10 eliminates the publication of the claimant benefit tables within the statutes.
  • Major changes to the process for getting unemployment decisions reviewed in circuit court are set forth in D15-11. These changes were previously described here and here. The Labor and Industry Review Commission opposed these changes, which essentially reverses the 2016 Appeals Court decision in DWD v. LIRC.
  • D15-12 allows the same protocols for unemployment taxes in regards to fiscal agents in adult care to apply to fiscal agents in child care situations.
  • D15-13 ends the sunset date in 2034 for the program integrity fund (i.e., the fund for receiving some of the monies from concealment enforcement) since the Department now expects concealment monies to continue in perpetuity. See the next two proposals for why.
  • The Department’s proposals for a program integrity slush fund, D15-14 and D15-15.

Labor and Management Proposals
The Advisory Council bill also includes management and labor proposals.

On the management side, there will be significant changes to what will be considered suitable work:

  • During the first six weeks of a job search, suitable work that a claimant MUST accept will be those jobs that (1) do not have a lower grade of skill than one or more of his or her most recent jobs and (2) have had an hourly wage that is 75 percent or more of what the claimant previously earned in his or her most recent, highest paying job.
  • After the first six weeks, suitable work means any work the claimant is capable of performing regardless of prior experience, skills, or training, as long as the wages for that job are above the lowest quartile wage-level in the claimant’s relevant labor market.

Once a job offer is considered suitable work for a claimant, then the claimant only has good cause for declining the job offer if the claimant’s personal safety is at risk, the claimant’s sincerely held religious beliefs conflict with the work, the work entails an unreasonable commuting distance, or some other compelling reason makes accepting the offer unreasonable. These changes to what will be considered suitable work will also apply to those who tentatively accept a job and then quit within the first thirty days.

In addition, this accepted management proposal will either eliminate unemployment eligibility entirely for anyone receiving temporary or partial workers’ compensation benefits or mandate offsets against UI benefits for those receiving these kind of workers’ compensation benefits (the specific type of workers’ compensation benefit being received leads to the different kinds of treatment). In other words, the SSDI prohibition is being expanded to workers’ compensation benefits. Also, anyone making a mistake in how they report their specific workers’ compensation benefits will, under the new on-line filing system, likely face a concealment charge for his or her mistake in reporting the kind of workers’ compensation benefits he or she is receiving.

These management-sponsored changes will take effect four weeks after enactment.

The labor proposals that the council agreed to include:

  • repealing the mis-classification prohibitions in workers’ compensation and fair employment law,
  • creating an administrative penalty for mis-classification for unemployment purposes of $500 per employee (capped at $7,500) when construction employers (and only construction employers) knowingly and intentionally provide false information to the Department (NOTE: compare this definition with the proposed changes to claimant concealment) for the purpose of misclassifying or attempting to mis-classify an employee,
  • fining employees in painting and sheetrock work $1,000 per incident (capped at $10,000 per calendar year) when coerced into accepting non-employee status for unemployment purposes, and
  • fining construction employers $1,000 per employee (with a maximum of $25,000) for subsequent violations as well as possible referral for criminal prosecution.

These mis-classification changes will take effect six months after passage.

Budget Bill Fixes
The LIRC funding fix bill, discussed here, was enacted as 2015 Wisconsin Act 194.

The call in the budget bill for the Department to create suitable work rules for claimants has been eliminated by the management-sponsored changes to suitable work described above.

Other unemployment-related legislation
A bill to address an NLRB decision about frachisors and franchisees was signed into law as 2015 Wisconsin Act 203. I previously noted that:

unemployment is not mentioned once in the [Browning-Ferris Industries decision this law is intended to undo], so the applicability and purpose — let alone its effectiveness — of the state law changes in this proposed legislation are muddled at best. And, as DWD notes in its memo, the changes could be extremely problematic for some Wisconsin employers.

A re-writing of real estate agent law in Wisconsin has been enacted via 2015 Wisconsin Act 258. The original bill, AB456, was intended, in part, to remove real estate agents completely from unemployment coverage. Even though real estate services are not considered covered employment for unemployment purposes, agents who qualify for unemployment benefits through other work they do outside of real estate sales found themselves and their brokerages being brought into unemployment hearings whenever there was a change in their relationship. In short, even though there is no covered employment or even an employer, the real estate agent is still treated as an employee who must either quit with good cause or be discharged without misconduct or substantial fault from a brokerage firm in order to keep receiving unemployment benefits connected to non-real estate work. The legislation as-passed leaves this process in place. Real estate agents, however, will be excluded as employees from workers compensation coverage, workplace discrimination law, and other workplace laws. See Section 174 of the new Act.

Previously enacted legislation
2015 Wisconsin Act 86 contained the following three Department proposals:

  • D15-02 is a house-keeping change that allows the Department to issue determinations against out-of-state employers in combined wage claims for being at fault for an erroneous benefit payment to a claimant.
  • D15-03 applies the Treasury offset program to employers, as described previously in this post.
  • A renewed work-share program, D15-07.

The new (actually old) restriction on travel abroad: concealment and departmental error

Insiders in the Department of Workforce Development tell me that in December 2015 the Department began tracking people who file on-line by their IP address. Because IP addresses identity the country from where a person connects to the Internet, the Department can now tell if a claimant is filing from outside the United States.

This new ability certainly helps in preventing identity theft against claimants or fake claim filing through fictitious companies and claimants — think Nigerian prince scandals with an entourage of suddenly laid-off staffers. But, this new ability also helps the Department enforce a 2012 law. Section 1 of 2011 Wis. Act 236 created a new Wis. Stat. § 108.04(2)(ae) that reads:

A claimant is not available for work under par. (a) 1. in any week in which he or she is located in a country other than the United States, as defined in s. 108.02 (15) (do) 2., or Canada for more than 48 hours unless the claimant has authorization to work in that other country and there is a reciprocal agreement concerning the payment of unemployment insurance benefits between that other country and the United States.

NOTE: Prior to this legal change, a claimant could still be eligible for benefits if his or her job market moved with her to the other country. See Honea v. Bou-Matic LLC, UI Hearing No. 11005590MW (13 June 2012).

Unfortunately, the Department has done nothing to tell claimants about this restriction. Indeed, the only information available about this categorical restriction on unemployment benefits is from p.27 of the Department of Workforce Development’s January 2013 Financial Outlook report to the legislature:

Act 236
Tighten Benefit Eligibility Requirements for Work Availability

Act 236 also changed various portions of UI law and operations. One change in the law brought about by Act 236 is to clarify the able and available provision of UI law. If a person is outside of the United States or Canada and is not there for a reason related to current employment they are not considered able and available for work and hence not eligible for UI benefits. This codifies what was existing UI procedure. As such this is not expected to have any effect on benefits paid or the UI Trust Fund. This went into effect on April 22, 2012.

Because the Department is now tracking IP addresses, it has begun enforcing this living abroad restriction against claimants. Not surprisingly, besides being declared ineligible for any unemployment benefits for the weeks living outside the US, claimants are also being charged with concealment for intentionally hiding their living aboard status (even though there is nothing from the Department indicating that this issue exists unless you happen to read unemployment statutes).

One of those recently charged with concealment was a claimant who traveled to Germany during the winter months of early 2015 to be with his girlfriend. He was there for love, not for a vacation. Furthermore, his job search was waived for these months, but he kept in contact with his employer on a weekly basis for when he should return to work. Regardless, the Department charged him with concealment for 22 weeks, demanding him to repay $8,140 in unemployment benefits, pay a 40% concealment penalty of $3,256, and forfeit $17,020 in future unemployment benefits because of that alleged concealment. In a lengthy and generally well-reasoned decision, the appeal tribunal tossed the concealment allegations. After observing that there “is no evidence that he was aware that there were geographic restrictions with respect to the availability question for unemployment purposes,” she found:

the mere fact that as a matter of law the claimant in this case is necessarily treated as having been “unavailable” for work while staying outside the United States does not obviate the literal truth that he was at all times ready, willing and able to accept fulltime suitable work during weeks 1 through 22 of 2015.

Because the Department has done nothing to notify claimants of this restriction, the issue of departmental error was also raised. The administrative law judge declined to find departmental error, explaining:

The claimant argues that the overpayment should be waived pursuant to federal law that requires state law to include provisions that reasonably affords those entitled to unemployment compensation benefits an opportunity to know, establish, and protect their rights under its unemployment compensation law. As such the department’s failure to include the geographical restriction in the Claimant Handbook or any other notice delivered to the claimant supports a waiver of the overpayment. However, the state law is in compliance with federal law because the unemployment insurance law is accessible publicly. The entirety of the unemployment insurance law simply cannot be reduced to the Claimant Handbook. Moreover, the department has provided its contact information in the Claimant Handbook with instructions to contact the department if there is a question concerning one’s eligibility for benefits. Accordingly, it was the claimant’s responsibility to report to the department that he would be traveling abroad and to ask whether his travel had any impact on his eligibility.

In other words, the appeal tribunal held that the Department satisfied its burden to explain unemployment law to claimants because the unemployment statutes can be read by the public and the claimant still had a duty to contact the Department about an issue he did not know was actually an issue and ask whether the problem he knew nothing about was actually a problem. To me, this conclusion means that claimants need to be both attorneys and fortune tellers.

Findings of the unemployment audit

Yesterday, December 16th, the Legislative Audit Bureau released its report on unemployment claims handling in Wisconsin.

The report is divided into three parts: telephone claims handling, processing of appeal decisions, and benefit over-payments. The most notable finding concerns telephone claims handling.

Telephone problems

The report shows that from late-November 2013 through mid-January 2014 that more than 70% and 80% of all calls to the Department’s initial claims phone line were blocked (see p.18 of the report). Furthermore, 50% to almost 90% of all calls to the inquiry phone line were blocked from July 2013 through mid-January 2014 (see p.19 of the report). That is a staggering collapse of the Department’s phone system.

At the January 2014 meeting of the Advisory Council, the Department explained this phone problem as a seasonal blip that was slightly more than expected because folks preferred the telephone to the on-line system:

Ms. Knutson asked the Council if there was any other business the Council would like to address. Mr. Gustafson referenced a recent story that aired in the Green Bay area related to the Unemployment Insurance claim telephone line experiencing back-ups. He asked how the department is handling this issue. Division Administrator Robert Rodriguez stated that currently the department is experiencing its typical peak season but due to a multitude of things this season has been more difficult. Mr. Rodriguez stated that the department received 220,000 calls last week. Mr. Rodriguez explained that the department cannot dictate how claimants use the system although online is recommended. It is, of course, the claimant’s choice but the department would like everyone who is able to use the online filing portal to use it, but understands that some people have limitations.

Mr. Gustafson stated there was not any real issue causing the increase in telephone calls such as something similar to the most recent recession, and he was worried that the story was misleading and painted the department in a bad light and it implied a much larger problem. Mr. Rodriguez stated that the department is scaled well for 46 or 47 weeks to meet demand but we have responded to the most recent influx by adding staff, which the department typically does during the seasonal peak, and has authorized additional overtime. Mr. Gustafson stated that the story did not ask the question how the department was reacting to the issue. Mr. Rodriguez stated that an individual having to call the department 20-40 times is not acceptable but reiterated that current numbers show that the issue is going away. Ms. Feistel asked if there were issues with the online claim filing system. Ms. Knutson recognized and asked Mr. Lutfi Shahrani, the department’s Benefits Director, to address the Council on this issue.

Mr. Shahrani stated that this is not a new issue. Wisconsin typically takes 8,000 calls in early November and that number increases towards the end of November and for the month of December but then begins to taper off in January. Mr. Shahrani stated that the difficulty is not on the side of those filing for benefits, but for those who are placing inquiry calls. A multitude of factors, such as the expiration of the federal EUC program, the reduction in capacity due to how the holidays fell this year, and the additional individuals who were unable to work due to the deep freeze all are contributing to the increase in inquiry calls. Mr. Shahrani brought up the 220,000 figure stating that we do not have 220,000 claimants currently receiving benefits. He explained how callers who repeatedly hit redial clog the system. He reiterated the department has reacted to the issue by hiring additional staff, extending work hours by allowing more overtime, by not allowing vacation during the holidays and by rededicating staff during the peak time. Mr. Shahrani also stated that just yesterday the IVR system which handles incoming calls was only at 60 to 70% capacity. Mr. Gustafson again reiterated that he felt the department was unfairly characterized within the news story.

As the audit report indicates, news reports at the time actually understated how extensive the phone meltdown was, and the Department’s explanation to the council about this problem was inadequate (for instance, the number of calls being blocked was hardly typical from prior years).

The report offers no explanation for why there was a sudden increase in phone calls. At the council meeting, the Department offered the explanation that the increase in calls arose because of the expiration of Extended Unemployment Compensation (“EUC”) benefits, a reduction in capacity because of the holidays (while the audit report claims that 20 LTE staff were added in October 2013 there is no explanation about the tasks to which those LTE staff were assigned), and historically bad weather that led to an increase in temporary layoffs. In his letter attached to the report, Secretary Newson points to the following cause for the meltdown: “During the winter of 2013-2014, uncertainty about the federal Emergency Unemployment Compensation program triggered a further spike in call volume.”

That explanation makes the most sense. As the audit report shows, unemployment has been steadily declining the past three years. The number of claims filed in the 2013-14 fiscal year was 520,100 — 272,200 less than the number of claims filed in the previous fiscal year. If there was a sudden spike in claims during last winter, the data is available on a weekly basis to show whether such a spike actually occurred. Since there is no data in the report about a winter increase in claims, the available conclusion is that a sudden spike in claims was not the reason for the sudden spike in phone calls.

So, the explanation for the increase in calls turns on folks wanting to know about EUC benefits that were slated to expire in December 2014 if Congress did nothing about the issue. As noted previously in this blog, the expiration of EUC benefits was a bigger issue in Wisconsin then in other states:

In Wisconsin, 23,700 individuals are slated to lose their EUC benefits at the end of December according to this House report. That’s about one out of every 242 residents having their income slashed just before the New Year.

Further, because EUC benefits affected everyone in the unemployment program, the number of folks in Wisconsin wanting to know what would happen to those benefits was obviously more than 24,000. Unfortunately, until December 13th (when the Department finally posted information on EUC benefits on its website), the only way for folks to find any information relating to EUC benefits was to call the Department. Even after information was posted to its website, the terse language in that post (if folks could even find this post) probably left many questions about EUC benefits unanswered, such as should they still file weekly claims in case the program was renewed and how would EUC benefits start up again if Congress acted?

Certainly, there might not be easy answers to these kinds of questions. But, folks facing the loss of all income will have these kinds of questions and more. As a result, the Department’s web response did little to quell the phone calls coming in. Not until it was clear that Congress would do nothing about EUC benefits in mid-January 2014 did the number of calls begin to decline.

And, this web response does not portend well when unemployment questions arise in the future. The audit report touts as one solution in the future an October 2014 upgrade to Department computer systems that provides claimants with basic information about their claims. There are three problems with those proposed solution. First, it is only available to those who can use the Department’s on-line system.  Second, there is no evidence that the Department is doing anything to encourage and educate folks about on-line access.  The Department does not use LinkedIn, FaceBook, or Twitter to provide unemployment information or on-line access at any level. Third, the current on-line information does not include an easy way to add new information and issues that might be relevant next year or the year after that by incorporating information from sources outside of the Department or providing easy access to the Department’s specific claimant records. In other words, this improved on-line experience is hardly a solution at all.

Appeals processing

The audit report shows that the handling of appeals has improved even though the staff (aka administrative law judges) handling those appeals has declined (from 33 in 2011 to just over 25 in July 2014). Decisions are now generally being issued within the time lines established by federal authorities. Comparisons in the report with other states, see pp.26-7, however, are misleading because those states may have different notice requirements than in Wisconsin. Wisconsin, for example, only requires six days hearing notice. Other states typically require more than six days hearing notice. Cf. 430 CMR § 4.11 (ten days hearing notice in Massachusetts), “Preparing For Your Appeal Hearing” at 3 (ten days hearing notice in Illinois), “A Guide To Unemployment Insurance Appeals Hearing” at 7-8 (in Michigan, ten days notice for unemployment hearings, 20 days notice for cases involving fraud allegations), and Minn. R. 3310.2905(2) (ten calendar days hearing notice in Minnesota).

What is most interesting is the breakdown of appeal issues presented in the audit report. Of 68,900 appeals filed in the past three fiscal years:

  • 19,400 concerned discharges
  • 8,900 concerned quits
  • 4,400 concerned able and available issues, and
  • 36,200 (more than half) concerned 32 other reasons

See pp.23-4 of the report. In Massachusetts, where I was an administrative law judge for unemployment cases in early 2000s, 80-90% of all cases being appealed concerned quit or discharge issues. Even with the complications created by EUC benefits, I suspect that this percentage of cases concerning quit or discharge issues still hovers around 70% and that this percentage similarly applies to other states. In Wisconsin, however, quit and discharge cases make up only 41% of the cases being appealed. That shift in caseload is remarkable and deserves further examination.

Over-payments

The audit report notes that over-payments occur generally because of unintentional mistakes but that most of the over-payment amount at issue is from what the Department has characterized as intentional fault. This last finding has caught the attention of a few politicians.

The report does not indicate, however, that the Department is often finding intentional concealment on facts that only show a mistake. For the past year, the Labor and Industry Review Commission (“LIRC” or “Commission”) has been publishing on its website on a monthly basis it seems decisions overturning concealment determinations. See, e.g., the discussions here, here, here, and here. Given that the Commission only receives about 12% of all appeal tribunal decisions, which in turn are less than half of all determinations issued, there are most likely many, many concealment determination that should be overturned but never are because no appeal is filed in time in those cases.

The report also does not indicate that there are steps the Department could take to reduce the over-payment amounts at issue. Most over-payments occur because claimants and employer report differing amounts of wages earned in a given week (most claimants are not in the habit or tracking their hours in the same manner and detail that employers do and so often their reports do not match their employers). At present, the Department does not get wage reports from employers until quarterly unemployment tax reports are filed. Other states, however, use information from employers’ bi-weekly or weekly payroll and tax withholding reporting to verify wage reports on weekly claim certifications. In January 2013, I sent the following e-mail message to Department staffers:

Dear Scott and Lutfi,

Here is the info on the Massachusetts effort wage matching effort:

Unemployment Insurance Fraud
Protecting the integrity of the unemployment insurance program is a responsibility that we take seriously.

Through our Program Integrity Department, the Massachusetts Department of Unemployment Assistance focuses on the prevention, detection, investigation and prosecution of those who defraud or attempt to defraud the unemployment insurance program.

DUA works with other agencies
Numerous actions are taken to prevent and detect the fraudulent collecting of benefits. For instance, our Program Integrity Department regularly compares wage records from the Massachusetts Department of Revenue with records of current UI claims to ensure that claimants who work part-time while collecting UI benefits report those earnings to DUA.

The Department of Revenue also provides our Program Integrity Department with a weekly report of workers added to employers’ payrolls. This “new hire” report is also matched against UI records to check that claimants who return to work do not continue to collect benefits. It is important for both workers and employers to be aware that eligibility for UI benefits ends on the day an individual starts full-time work.

To prevent fraud, our Program Integrity Department matches records with those of other state and federal agencies including the Social Security Administration, the state Department of Corrections, and others.

Once DUA establishes that a claimant has collected unemployment insurance benefits to which he or she was not entitled, the Program Integrity Department’s Recovery Unit aggressively works to recover the overpaid benefits. A variety of collection tools are utilized including criminal and civil prosecutions, the interception of Massachusetts state income tax refunds, mail dunning, and the offset of any future unemployment benefits. Additionally, DUA levies a 12 percent annual interest charge against any outstanding overpayment balance if the claimant was determined to be “at fault”.

You can help
We welcome information from concerned citizens who know of workers who continue to collect UI benefits while they are employed.

You can report individuals who are collecting benefits while working full-time and employers who are paying workers and not reporting wages via any one of these methods:

1. Completing the DUA Fraud Hotline Complaint Form
2. Calling the Fraud Hotline – 1-800-354-9927
3. Emailing uifraud@detma.org
4. Writing to the U.I. Program Integrity Department, P.O. Box 8610, Boston, MA 02114. Or Fax to 617-723-5312

Employers can also download an AntiFraud Poster pdf format of poster_antifraud_508.pdf in English and Spanish.

From http://www.mass.gov/lwd/workers-and-unions/general-resources/report-fraud/ui-fraud.html

From what I understand, Wisconsin does everything above except for the weekly new-hire reporting/matching. From what I recollect, Wisconsin does new-hire matching every quarter.

* * *

Also, it appears that New Mexico has adopted something similar to Massachusetts along with a new web portal for both claimants and employers:

New unemployment insurance tax & claims system launched
For the Headlight Posted: 01/10/2013 02:54:21 PM MST

ALBUQUERQUE – The New Mexico Department of Workforce Solutions (NMDWS) this week successfully launched a new Unemployment Insurance (UI) system, marking the first time any state has simultaneously launched an integrated UI tax and claims system.

In just two days, the new system has already paid out $4 million in UI claims, certified over 17,000 people for their weekly benefits, helped over 22,000 customers open self-service online accounts, and enabled nearly 1,000 employers to electronically file wage reports, some for the first time.

Governor Susana Martinez said New Mexico’s new UI system is significantly improving the timeliness and accuracy of UI payments, enhancing the level of service provided to unemployed workers and businesses, and strengthening the state’s ability to prevent, detect, and recover improper UI payments.

“In just 36 months, we have replaced a 30-year-old tax system with a modern UI system that is more convenient for customers, more efficient for state workers, and more secure for the businesses that fund this program,” said Governor Martinez.

Since Monday, January 7, the NMDWS UI Operations Center has fielded some 182,000 phone calls from 17,500 unique callers. “While this extraordinarily high call volume impacted our ability to respond to all callers in a timely fashion, we successfully converted data from the old system to the new one,” said Secretary of NMDWS Celina Bussey. “The new UI system has been stable since it was launched and the majority of regular UI claims have been paid promptly.”

NMDWS has more than doubled the staff in their UI Operations Center and taken a number of additional steps to ensure that the agency is meeting the needs of its customers.

“We have immediately addressed any issues that have arisen and we are constantly monitoring our operations to ensure that we are providing the highest level of service to our customers,” Bussey said.

She noted that thousands of people have been able to go online to certify and receive their UI benefits and hundreds of employers and third-party administrators have already taken steps to directly manage their own UI accounts without NMDWS staff assistance.

“With anything new there is a learning curve,” Bussey said. “Our customer service agents are doing everything they possibly can to help our customers adjust to our new program integrity measures and understand the many options and benefits of the new system.”

Bussey said that a banking error unrelated to the new system was quickly resolved on Tuesday and everyone who has certified for benefits has received their UI payments. She also said that Wells Fargo has agreed to refund debit card holders any fees they may have incurred as a result of the delay in benefits being deposited in their accounts.

Since the new UI system launched on Monday, claimants have been applying for benefits, requesting payments, maintaining account information, and responding to requests for information. These new self-service options are helping to expedite UI payments to unemployed workers and more quickly resolving issues between employers and claimants.

The new UI system is also providing New Mexico employers with a single repository of all UI business functions. This self-service functionality is speeding up the processing of new registrations and appeals, and allowing employers to electronically file wage reports and respond to notices of claim filings. In the past, paper filing has cost NMDWS significant resources and delayed important wage data from being entered into the UI system.

The new system is also automatically calculating taxable wages and amounts due and accepting electronic payments from employers. In the past, all payments were processed with paper checks. On Tuesday, the first batch of employer electronic payments was successfully processed directly to the bank – without staff intervention.

The vast majority of calls to NMDWS’ toll-free number – some 7,000 – have dealt with the new federal law that extended unemployment benefits.

Bussey said NMDWS is working through each individual Emergency Unemployment Compensation (EUC) claim to help eligible claimants register for benefits. Due to recent rule changes and the complexity of multiple extended UI benefits, each claim is taking more time than usual to set up.

Of the 7,000 New Mexico EUC claimants potentially eligible for continued extended benefits, NMDWS has successfully paid about 1,000 this week. Many others claimants who no longer have money available in their UI account are calling NMDWS to inquire about their eligibility. NMDWS is working to determine if these people are eligible and, if so, to set them up with payments.

To strengthen the integrity of New Mexico’s UI program the new system includes what is known as “intelligent data collection and data validation” to reduce errors and increase the accuracy of UI payments. The system recognizes applicants after they have logged into their accounts and then directs them to the appropriate task. It also includes new tools to prevent overpayments and automated cross-matches with state and federal databases, such as the National Directory of New Hires.

Additional information about the new Unemployment Insurance Tax & Claims System and the New Mexico Department of Workforce Solutions is available at http://www.dws.state.nm.us. For the latest announcements and updates, follow NMDWS on Twitter (twitter.com/NMDWS) and the official YouTube channel (youtube.com/user/nmdws).

from
http://www.demingheadlight.com/deming-community/ci_22349104/new-unemployment-insurance-tax-claims-system-launched

If the Department here in Wisconsin took advantage of employer’s payroll filing rather than the quarterly unemployment tax filing, then discrepancies in wage reporting would be addressed within a few weeks rather than months later (indeed, many investigations I have seen about wage reporting discrepancies usually occur nine months to a year later). It is perplexing to say the least for why the Department has not begun exploring the option of using payroll reporting to verify claim information. In short, over-payment issues are not just a claimant problem. The Department could easily be more efficient and thorough in its own work in order to catch these kinds of problems earlier.

DWD’s re-institution of the flier for the unemployment clinic

Back in July 2014, I noted that the the unemployment clinic I help manage was experiencing a notable decline in clientèle.

The clinic is now happy to report today that the Department of Workforce Development has taken significant steps to correct the issue and that clinic attendance is returning to normal as a result.

Unemployment clinic sees marked drop in attendance

At the unemployment clinic I help manage, there has been a marked drop in attendance the past few months. Supervising attorneys and law students alike have been trying to figure out what is going on.

Well the clinic finally got an answer. Essentially, the Department of Workforce Development stopped sending to claimants in Dane County the one-page notices about the unemployment clinic that they previously received with their notification of appeal. Now, all that claimants receive is a flier telling them to go to a website for information about unemployment issues (the on-line only handbook was previously noted here). As the post explains, claimants have to click on several links that are in no way obvious to find a new handout describing the free legal assistance in unemployment cases available from the clinic.

Important and comprehensive concealment analysis from LIRC

LIRC has just published to its website a comprehensive analysis of concealment issues in unemployment cases.

The decision is lengthy, as concealment cases by their very nature require a week-by-week examination of wages and unemployment benefits. This case also has a complicated history (LIRC issued an earlier decision that DWD asked to be reconsidered), and LIRC is careful here to delineate what standards should apply in a finding of concealment, what Department investigations should entail, and the obligations of administrative law judges during hearings when confronted with claimants who have difficulty understanding what is happening to them in regards to the concealment allegations.

There are two main factual issues at stake in this decision. First, the claimant was confused by the change in how DWD asks claimants on their weekly claim certifications about work and wages or pay received. This issue is not new, but here LIRC goes into detail about why a compound question on weekly claim certifications is problematic. The Commission explains (footnotes removed):

The commission is not alone in finding compound questions like the department’s Question No. 4 a potential source of misunderstanding by claimants. In June 2011, the U.S. Department of Labor strongly encouraged states to review the wording of their continued claims certification form and telephone script to assess whether any questions or language should be made clearer to ensure claimants understand what is being asked. The following example was given:

If the certification form or script contains a two-part question such as:

  • Did you work and earn wages during the week?

Two separate questions could be asked instead, such as:

  • Did you perform any work during the week?
  • If you worked, what was the amount of wages you earned during the week (report wages earned whether or not these wages have been paid)?

This suggestion to rid claim certification forms and telephone scripts of two-part questions was part of an immediate call to action by the U.S. Department of Labor to all state  administrators to develop state-specific strategies to bring down the improper payment rate in unemployment insurance benefits programs. The call to action was communicated in Unemployment Insurance Program Letter (UIPL) No. 19-11, titled National Effort to Reduce Improper Payments in the Unemployment Insurance (UI) Program. It was recognized that the best way to effectively reduce the improper payment rate is to prevent improper payments before they occur. The U.S. Department of Labor identified unreported or under-reported earnings by claimants as the primary cause of overpayments.

Yet, in spite of the call to action, sixteen months later, in October 2012, the department did exactly the opposite of what the U.S. Department of Labor suggested it do. The department took a relatively simple, straightforward question, one not easily susceptible to misinterpretation — “Did you work?” — and created a compound question — “During the week, did you work or did you receive or will you receive vacation pay, bonus pay or commission?” In doing so, the department created an identified cause of misunderstanding by claimants and a known source of improper payments. Question No. 4 was not made clearer to ensure claimants understood what was being asked; it was made more complex and confusing. At the same time, the department also increased the penalties for concealment.

Second, the Commission found from the claimant’s testimony that she was most likely learning disabled and confused about her reporting requirements as well as the unemployment process in general. While her prior unemployment claims and her receipt of the claimant’s handbook (on-line only now) indicated that it was possible to infer that concealment could have happened, other evidence demonstrated that an actual intent to conceal was completely lacking.

It was clear from the employee’s testimony throughout the hearing that she was confused. The employee was confused about how the unemployment insurance program operates in general and was confused by Question No. 4 on the weekly claim certifications in particular.

In a request to reconsider this decision, the Department contended that there needed to be evidence causally linking the claimant’s confusion or disability to the actual mistakes on her weekly claim certifications. The Commission disagreed (footnotes that cite to portions of the Disputed Claims manual on an internal DWD intranet that is not available to the public are removed):

The reason no connection was made between the employee’s learning disability and her failure to provide accurate information to the department is because the ALJ did not develop the record on this issue. It was clear that the employee did not understand her responsibility to report her second, short-term job to the department. After the ALJ twice explained to the employee why it was necessary, the employee remained confused. The employee apologized to the ALJ and stated that she, the employee, was learning disabled and “a little slow.” Not a single follow up question was asked of the employee.

The “fair hearing” provision in sec. 303(a)(3) of the Social Security Act requires a reasonable opportunity for workers whose claims are denied to be heard by an impartial tribunal in an adjudicatory proceeding which assures them of elementary fairness. An unemployment insurance ALJ is responsible for discovering the facts and may not rely on the parties to present their cases and facts, as they understand them, and to offer complete proof. Moreover, state unemployment agencies, such as the department, have a public duty to cooperate in revealing pertinent facts and other evidence that are peculiarly within their own knowledge, whether favorable or unfavorable to the claimant. A state agency is not to assume a hostile or an indifferent attitude in cases in which it views itself as an adverse party, because it leaves to the claimant the task of discovering exculpatory facts, a task claimants are most likely ill-prepared to perform. Thus, when the department alleges that a claimant has committed fraud and the claimant states that she is learning disabled, an ALJ is expected, at a minimum, to follow up on the claimant’s statement and attempt to ascertain whether any cognitive difficulties contributed to the confusion on the part of the claimant and led to an honest mistake.

* * *

A claimant may establish the existence of learning, reading, and comprehension difficulties through non-certified and non-medical evidence by testifying, for example, as to whether he or she received special education services in school, required an individualized education plan, had low reading scores, or failed to graduate from high school.

There is much more to consider in this decision. Furthermore, it should be noted that the disabled often lack the resources and abilities to provide information about themselves or only have the ability to offer generalities rather than any specific information. Claim investigators and administrative law judges will need some sensitivity in how to delve into such matters as direct questions are unlikely to get specific evidence.  Still, this decision sets forth in great detail what the Department should be doing if it wants to allege that a claimant has actually intended to conceal material information on his or her weekly claim certifications.