Governor Ivey criticizes Alabama’s efforts to claw back unemployment money, says people shouldn’t pay for government mistakes

Governor Kay Ivey asks Alabama Department of Labor for solutions after AL.com reported Thursday that the state is requiring Alabamians to repay thousands of dollars in pandemic unemployment and is often years behind in hearing their appeals.

“We have asked Secretary (of Labor) (Fitzgerald) Washington to provide us with solutions to resolve this troubling situation, as well as the outrageous backlog,” said Gina Maiola, the governor’s spokeswoman. AL.com Thursday.

Maiola said the governor was not consulted on the department’s efforts to recover the workers’ money.

Last year, many Alabamians received letters in the mail saying they owed the state thousands of dollars, often as much as $15,000 or $20,000, after the department discovered they had overpaid unemployment benefits during the pandemic.

During COVID-19, the federal government gave money to states for weekly unemployment benefits of $600. One in four Americans was unemployed during the pandemic, according to The Century Foundation.

The department said it would consider making changes following Ivey’s message on Friday.

“The department is currently seeking to expand the use of authorized waivers under federal guidelines,” said Joseph Ammons, general counsel for the Department of Labor.

Overpayments are often the result of errors on the part of the claimant, the department or an employer. Errors occurred due to the high demand for help during the crisis caused by COVID-19, which ultimately led states like Alabama to report many people’s unemployment benefits as incorrect and overpaid.

Until the department reviews an overpayment decision through an appeal, the overpayment is not final. However, the state has been unable to follow up on the calls, Legal Services Alabama said in a lawsuit filed earlier this year against the Secretary of Labor.

The lawsuit asks Judge James Anderson to order the Washington Secretary of Labor to pick up the pace and improve departmental processes. Judge Anderson is now considering whether Secretary Washington is protected from trial by sovereign immunity.

Michael Forton, director of legal services policy, said he would like the department to fix its lagging process instead of spending resources collecting overpayments from workers.

“They shouldn’t try to collect overpayments until they can process everything and provide a meaningful appeal structure,” he said. AL.com Friday.

Some other states have offered pandemic overpayment forgiveness by seeking federal waivers to offer blanket forgiveness, but Alabama has not. If someone appeals an overpayment and wins, a waiver isn’t necessary for the debt to be cleared, according to Forton.

But Alabama lags even further behind other states in reviewing appeals. In 2021, Alabama’s average calls were on hold for 566 days, while in Kansas calls were resolved on average in 15 days.

Forton said if the department started allowing more waivers, it would be “groundbreaking” and a “huge success” for Alabamians.

“ADOL currently waives overpayments based on agency or employer error, and offers payment plans to claimants whose overpayments are not waived,” Ammons said.

According to federal data, the state overpaid $146 million in unemployment in 2020 and 2021. Alabama waived more than $1 million in overpayments for 295 people in 2020 and 2021, according to the department, and he expects waivers for an additional $2,943,042 in benefits in the future.

In her post, Maiola stated Ivey’s disapproval of taking the money back.

“Ultimately, the agency approved and paid the claims. If a mistake is made by the government, people shouldn’t have to pay the price for something that wasn’t their fault.”

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