Jobless workers overpaid $77 million may be eligible for a waiver to avoid paying it back

85,000 claimants notified about overpayment waivers
Posted at 12:09 PM, Aug 19, 2021
and last updated 2021-08-20 13:55:36-04

BALTIMORE — While many are still waiting for their unemployment insurance benefits, tens of thousands of claimants are being told they were paid too much.

At the end of June, the Department erroneously overpaid claimants more than $77 million, according to data submitted by Maryland to the U.S. Department of Labor.

These were non-fraud overpayments meaning it could’ve been a state agency error, employer error, claimant error or some other error.

The Department issued $1.4 million in fraudulent overpayments.

Claimants, like Charlotte Cook, a furloughed worker who was sent an overpayment notice of $8,385, doesn't believe she's at-fault and should have to pay the money back.

“How do you give a person $129 every week over what they were supposed to get?” Cook asked.

Shaunice Davis, a mother of three who had to stay home to take care of her kids during the pandemic, was sent an overpayment notice for $15,735.

"Why and how was I overpaid?" said Davis.

Both claimants gave the Department of Labor the information requested and had been receiving their benefits without issue for months.

“I’ve never been unemployed, so this is completely new to me as to whether [my weekly benefit amount] is right or wrong. I trust the people at unemployment to make that decision,” Cook said.

This overpayment issue became a common complaint at the start of the year.

RELATED: Jobless workers sent notices demanding repayment of thousands of dollars in unemployment benefits

In March, the Department of Labor said overpayment waivers for Pandemic Unemployment Assistance claimants would be going out soon.

In April, the Department was still waiting on guidance from the U.S. Department of Labor.

WMAR-2 News Mallory Sofastaii followed up with the Department in August. A few days later, a spokeswoman with MDOL said the application just became available and approximately 85,000 claimants were sent instructions on how to apply for a waiver.

“This includes all claimants that have had an overpayment from the PUA, PEUC, FPUC, and MEUC federal programs at any time since February 2020. This includes claimants who may have chosen to pay their overpayment in their BEACON portal and now may be eligible for a refund if they complete the waiver application,” Fallon Pearre, MDOL Director of Communications, wrote to Sofastaii.

“It seems like nobody was watching the system,” said Cook.

Between April 1, 2021 and June 30, 2021, USDOL data shows zero as the amount of overpayments waived.

The Department said they’ve received around 2,200 requests since the start of the pandemic, and they will now begin processing waiver applications.

“In addition to preventing and detecting an unprecedented type and volume of unemployment fraud, the Division’s Benefit Payment Control Unit is responsible for collecting and waiving overpayments. Now that the Division has the necessary guidance from the U.S. Department of Labor to process waiver applications for the federal programs and Lexis Nexis has been onboarded to assist with fraud, the department has begun processing the waiver applications,” wrote Pearre.

The Department added that a new functionality has also been programmed in BEACON that will allow the system to automatically detect claimants with overpayments that meet the eligibility requirements in USDOL’s Unemployment Insurance Program Letters and will apply the waiver to their claim.

“The testing of this functionality is being finalized, but will be available soon and will prove to be beneficial to claimants,” Pearre wrote.

To qualify for a waiver, claimants need to:

  • Apply within 30 days of the original overpayment notice or the date on which the Maryland Department of Labor notified you of your right to request a waiver, whichever is later
  • Cannot be at fault for the overpayment
  • Show that (a) it would cause you financial hardship, (b) recovery would be unconscionable under the circumstances, or (c) because you expected a federal pandemic benefits payment or received an incorrect federal pandemic benefits payment, you gave up a valuable right or changed positions for the worse (in other words, you relied on the federal pandemic benefits payment when making a decision)

“Each overpayment waiver request goes through an individualized, fact-intensive review. Agency error will factor into whether an overpayment is non-fault and even whether recovery of the overpayment would be “unconscionable.” If an adjudication is reversed, then there would likely be no overpayment, so a waiver would not be necessary. When it comes to other errors, the waivers will be granted on a case-by-case basis, taking into account a claimant’s particular circumstances,” Pearre wrote.

To apply for a waiver of federal pandemic unemployment insurance benefits overpayments, click here.

To apply for a waiver of regular (non-pandemic) unemployment insurance benefits overpayments, click here.

If you were assessed an overpayment of federal pandemic benefits and regular UI benefits, you should submit separate overpayment waiver requests for both the regular UI and the federal pandemic benefits.

Click here for more information on waiver requests.