Wolf Administration issues response to alleged unemployment compensation cover up

Local News

Governor Tom Wolf’s administration is issuing a response to Senator Dan Laughlin’s call for an investigation into an alleged unemployment compensation error cover up.

Laughlin says the Wolf administration attempted to cover up sweeping overcharges against unemployed Pennsylvanians, claiming the administration knew about the overcharges in 2016.

A statement from the Governor’s office reads:

“The administrative error occurred in 2006 and continued through the Corbett Administration until it was discovered and corrected by this administration.

As soon as the incorrect interest rate was discovered, the agency began working to identify, calculate, and return the overcharged interest. L&I also took immediate steps to correct the fault overpayment interest rate for 2017 and has been collecting the correct rate since then.

As reprogramming of the unemployment system was being completed to issue the refunds, the COVID-19 global pandemic began, and staff had to be redirected to assist with the unemployment crisis.  Approximately 28 percent of interest reductions on fault overpayments was completed before the project was paused to deal with the COVID-19 unemployment crisis.

The recent launch of the new UC system has allowed L&I staff to resume working on the refund project. Individuals who still owe an overpayment will not receive a refund, but will have the interest from the range of affected year on their owed amount reduced until the amount owed is correct. L&I staff will also be contacting individuals who have repaid their fault overpayment and may be due a refund of overpaid interest.

Approximately 250,000 individuals were affected by the interest overcharge. Of these individuals, 65 percent are owed less than $5; 80 percent are owed under $50. Individuals with non-fault overpayments are not charged interest and therefore are not affected by the overcharge.

L&I also issued a press release last week announcing that some people would receive refunds and others would have the overpayment to date reduced from their remaining debt to the department.

It is important to remember the overpayments occurred when people were making repayments to L&I for intentionally withholding or providing incorrect information to get UC benefits for which they are not eligible.

In these situation, many individuals with “fault” overpayments have intentionally misrepresented their circumstances and are either working and not unemployed at all, or indicate they are unemployed when they are working and choosing to not report their earnings.”

L&I’s press release explains the situation in detail and the action the agency is taking. https://www.media.pa.gov/Pages/Labor-and-Industry-Details.aspx?newsid=603

The office of Governor Tom Wolf

For news delivered right to yousubscribe to JET 24/FOX 66/YourErie.com’s breaking & daily news email list

Copyright 2021 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Don't Miss

More News