Dear Neighbor,
The problems with unemployment insurance are many and complex. This is the the first of two newsletters on people being asked to repay "overpayments" even if they did nothing wrong. It's based on important reporting by Larry Edelman and Shirley Leung of the Globe's Business section.
My next newsletter will be about what my staff, my colleagues, and I have been doing to help solve the problems.
[link to article is here]
Millions of people in Massachusetts survived the pandemic economically with the help of unemployment benefits. The lead story in today's Globe gives four examples of the hundreds of thousands of people who are now being told to repay those benefits - even though they did nothing wrong. It follows more than a month of investigation into the issue.
People have been writing comments on each story with many examples of the bureaucratic nightmare that many encountered. A recent Globe letter writer described some of the frustrations; her letter was titled "Ordinary people are no match for the jobless aid maze." The comments are numerous and worth reading!
Following are some earlier stories in the series.
[link to article is here]
On January 17, Larry Edelman reported in the Globe that the administration was trying to "claw back" $27 billion in unemployment benefits from over 300,000 recipients. "Most clawback cases follow a similar pattern, said Representative Joan Meschino: 'I did what I was told. I filed. I received it. I spent it. And now they are trying to get it all back.'”
Also from Edelman's article: "'Many people facing overpayments have already spent the money on necessities like food, rent, and transportation, or made purchases assuming they could afford it,' said Hannah Tanabe, a staff attorney at Greater Boston Legal Services. And since a majority of the overpaid benefits were funded by the feds, recoveries effectively drain money from the Massachusetts economy.
'We shouldn’t be driving workers who are getting back on their feet into more precarious financial situations when the overpayment resulted through no fault of their own,' she said."
[link to article is here]
On January 19, Edelman wrote an online column that said "There needs to be some accommodation for honest folks caught in the quagmire." Boston Chamber of Commerce's Jim Rooney asked how much the clawbacks would cost, compared to the returns. Edelman pointed out that "clawbacks take money that would otherwise be largely spent in the local economy, putting it back in the trust fund or sending it to the US Treasury," and quoted me: “It’s bad for people and bad for businesses.”
(The vast majority of recovered money was from federal programs, and would be returned to the federal government.)
[link to article is here]
On January 10, Edelman directly called for a pause to sort out problems with overpayments.
[link to article is here]
On January 23, the Globe's Shirley Leung reiterated the call for a pause, She noted that state regulations say you can get a waiver from repayment if your current income is less than your expenses. "That seems reasonable, but matters can get messy. If someone used the benefits for an out-of-ordinary expense, like buying a car, the state cannot claw back the money. But if the money was used to help pay the mortgage, you’ll need to return it."
(I will write more in the next newsletter about the unfair standards the administration is using to decide about waivers and why they can and should change those standards now.)
[link to article is here]
On January 25, Leung and Edelman said the state should "Pause the clawbacks (or whatever the governor wants to call them) until he and the Legislature can come up with a fair — and compassionate — solution.
[link to article is here]
On January 27, they reported that Baker is asking Congress for some kind of help.
(Actually the National Association of State Workforce Agencies called on the federal government on January 2 to allow states to waive nonfraudulent overpayments. They argued that recipients "spent these funds months ago to help preserve their own economic stability. The likelihood of recovering these funds is low and the cost of states' efforts to secure repayment far outweighs any monetary returns. In addition, these individuals will be denied further UI assistance until repayment is made, as individuals determined to have overpayments are ineligible for future UI assistance.")
[link to editorial is here]
On January 31, the Globe editorial board wrote that "for those who played by the rules, as they understood them, and are now being asked to repay money they already spent, it makes sense to come up with a forgiveness program."
[link to article is here]
On February 7, Edelman wrote that the federal government has issued new guidance giving states even more flexibility in granting waivers for overpayments. But Rory MacAneney, a Community Legal aid attorney, pointed out that the administration would have to change their interpretation of "equity and good conscience,’ which is the federal and state standard. She said that “Most folks would think that it would be against equity and good conscience to require someone to repay benefits that were overpaid because of DUA’s negligence or error, or its deliberate decision not to request information from employers until 6 months after claimants already received benefits. But not DUA.”
(In the next newsletter.You can learn about the letter I co-authored on Friday with my Labor and Workforce Development Committee co-chair Rep. Josh Cutler, asking the administration to pause collections while they consider these flexibililties.)
Coming soon: a newsletter on what we're doing about it.