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NYS Comptroller

THOMAS P. DiNAPOLI

Department of Labor
Examination of Unemployment Insurance Benefits
(Issued: 10/07/2015)


Purpose

The objectives of our examination were to determine if: (i) Unemployment Insurance (UI) benefit payment requests and payments made by the Department of Labor (DOL) were appropriate and in accordance with applicable Federal and State laws and regulations and DOL policies and procedures, and (ii) DOL took corrective action and recouped overpayments based on the results of our findings.


Background

To accomplish our examination objectives, we selected for audit benefit payment requests and payments based on risk.  We identified high risk payment requests and payments by analyzing the daily payment file and performing file various matches.  We used the results of our analyses and file matches to identify and recover any inappropriate payments and to prevent future inappropriate payments.  In addition, we matched the DOL UI Benefit Overpayment File to the New York State Payroll File to identify newly hired New York State employees who owed DOL money for outstanding benefit overpayments.

The results contained in our report cover select high risk payment requests and payments DOL processed from January 1, 2014 through December 31, 2014, prior years’ payments associated with those high risk payment requests and payments, and prior years’ findings confirmed by DOL during in 2014.


Key Findings

  • We identified 8,392 overpayments totaling more than $2.1 million.  This includes $168,878 in payment requests stopped, $399,356 in future payments that would have been made over the life of the claim had DOL not taken corrective action based on our findings, and $1,600,459 in erroneous payments.
  • We identified 711 underpayments totaling $118,804.  This includes $27,508 in current payments and $91,296 in future payments that claimants would not have received over the life of their claims had DOL not taken corrective actions based on our findings.
  • We found other potential recoveries totaling $403,456.  This includes $224,220 from newly hired New York State employees who owe DOL for UI overpayments made in prior years, and $179,236 from claimants against whom DOL assessed monetary penalties as a result of our findings.
  • DOL has recovered $737,695 from UI claimants and New York State employees due to our current and past examination efforts.  This includes $260,163 in forfeited UI benefits from claimants who made false statements or representations to obtain benefits they were not eligible to receive, and $477,532 from New York State employees who owed DOL for past UI overpayments.


Key Recommendations

  • Continue to enhance controls to identify claimants falsely certifying eligibility to receive UI benefits.
  • Ensure staff follows established policies and procedures when processing claims.
  • Establish and implement controls to prevent overpayments resulting from limitations in the DOL UI payment system.
  • Continue to recoup overpayments and monetary assessments from claimants, as appropriate.
  • Determine the financial impact of Section 597.3 of the State Labor Law on the Unemployment Insurance Program.  Consider seeking authority to prevent future overpayments once they are identified.

For a complete copy of Report 2014-BSE-3A-001, click here.

 


Division of Contracts and Expenditures
Bernard J. McHugh, Director of State Expenditures

Phone: (518) 474-4868 Email: stexpend@osc.state.ny.us
Address: Office of the State Comptroller, Division of Contracts and Expenditures
110 State Street, 10th Floor; Albany, NY 12236