March 4, 2022

Baker administration writes to Marty Walsh, asking to waive requirement to recoup unemployment overpayments

BY Amy SokolowBoston Herald

Pictured: Central West Justice Center Staff Attorney Cory Mescon

Charlie Baker’s Executive Office of Labor and Workforce Development has sent a letter to former Boston mayor and current Secretary of Labor Martin Walsh, asking him to waive the requirement to recoup overpayments of unemployment relief.

“Without a blanket waiver option,” the letter states, “the agency must evaluate on a case-by-case basis potentially more than 300,000 waiver applications. That process is laborious for the agency and can be frustrating for the claimant.”

The letter, sent Thursday by Secretary of the Executive Office of Labor and Workforce Development Rosalin Acosta, asked for a “blanket waiver” for all non-fraudulent overpayments to Pandemic Unemployment Assistance programs, who received the “vast majority of overpayments,” according to a spokesperson.

The Pandemic Unemployment Assistance program helped those who primarily worked in the gig economy and those who are self-employed, rendering them ineligible for other unemployment programs. Other groups the request applies to include those who received Federal Pandemic Unemployment Compensation, Pandemic Emergency Unemployment Compensation, and Mixed Earner Unemployment Compensation.

Acosta noted that many affected by the overpayment issue “spent these funds months ago to help preserve their own economic stability,” she said. “Meanwhile, we know from historical experience that even with a significant investment of agency time and effort, the recovery rate for overpaid funds is relatively low in view of all the attendant challenges and the limited financial resources of most claimants.”

The letter notes that these rule changes resulted in more than $1 billion in already paid claims, which “had a particularly dramatic consequence on Massachusetts claimants because the state rolled out PUA quickly in spring 2020,” Acosta said.

Acosta explained that, midway through the PUA program, the federal Department of Labor’s rules changed to require claimants to provide documentation of employment or be ruled retroactively ineligible for benefits.

“While this measure was meant to address the problems with fraud that had developed in the PUA program, one unintended result was that legitimate claimants were automatically determined to be overpaid,” she said.

Cory Mescon, an attorney with the Central West Justice Center, said she’s had many low-income clients with this issue, who work as construction workers, store clerks, graphic designers and more. She’s seen overpayments ranging from a few thousand dollars to upwards of $40,000.

“It’s just astronomical amounts that people don’t have,” she said. “People spent the money in good faith, just making payments to support their families during the pandemic, and I think that it’s great that Secretary Acosta is asking for blanket waivers,” she said.

A federal DOL spokesperson said it had received the letter and was reviewing it.