Department of Labor

Effect of Legislation Limiting Combined Unemployment Insurance and Workers' Compensation Benefits

Beginning in September 1996, the combined unemployment insurance and workers' compensation benefits paid to an individual are limited by State law to 100 percent of the individual's average weekly wage. In order to determine the savings likely from this legislation, we examined the unemployment insurance payments made by the Department of Labor and the workers' compensation payments made by the State Insurance Fund for a six-month period. We identified a number of instances in which the combined payments received by an individual exceeded 100 percent of the individual's average weekly wage. On the basis of this determination, we estimate that, because such payments are limited by the new legislation, savings of about $286,000 a year can be realized. We also determined that, during the six months audited, almost $19,000 in unemployment insurance benefits were paid to 16 individuals by the Department of Labor at the same time that the individuals were receiving disability insurance from the State Insurance Fund for being unable to work. We recommend Department of Labor officials investigate these payments, recover all inappropriate payments, and establish procedures for preventing and detecting such inappropriate payments.

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