Provides that any claimant who has received certain unemployment benefits to which they were not entitled shall not be held liable for the amounts overpaid provided certain conditions exist; directs the department of labor to provide claimants who have previously been denied waivers with applications for individual waivers; repeals certain provisions of law relating thereto.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A8928A
SPONSOR: Bronson TITLE OF BILL:
An act to amend the labor law, in relation to the recovery of overpay-
ments of unemployment benefits; to direct the department of labor to
provide claimants who have previously been denied waivers with applica-
tions for individual waivers; and to repeal certain provisions of such
law relating thereto
PURPOSE OR GENERAL IDEA OF BILL:
To require the Commissioner of Labor to waive certain overpayments of
unemployment benefits that have occurred during the COVID-19 pandemic,
in addition to certain overpayments going forward.
SUMMARY OF PROVISIONS:
Section one of the bill would establish that a claimant shall not be
held liable for overpayments of state or federal unemployment benefits,
as permitted under federal law, provided that the overpayment was not
due to fraud or fault on the part of the claimant and the recovery of
such overpayment would be against equity and good conscience. The
Commissioner of Labor would also be required to notify the claimant when
an overpayment has occurred and inform the claimant of his or her right
to request a waiver. Upon any denial of a waiver request, the Commis-
sioner would also be required to notify the claimant of his or her right
to request an adjustment to the repayment schedule.
Section two of the bill would repeal subdivision 4 of section 597 of the
Labor Law which sets forth the current limits for overpayments of bene-
fits.
Section three of the bill would establish the effective date.
DIFFERENCE BETWEEN ORIGINAL AND AMENDED VERSION (IF APPLICABLE):
N/A
JUSTIFICATION:
Overpayments of unemployment insurance benefits have become a signif-
icant problem for both claimants and state unemployment agencies
throughout the country in the wake of major job losses caused by the
COVID-19 pandemic. According to the U.S. Department of Labor, New York
paid out approximately $70 billion in unemployment benefits in 2020
including roughly $115 million in overpayments, while other states
across the country paid a combined $2.9 billion in overpayments. To
address these concerns, the federal government has allowed states to
waive repayments of benefits, including Pandemic Unemployment Assistance
benefits, that are found to be without fault on.the part of the claimant
and when such repayment would be contrary to equity and good conscience.
Under current New York State law, state unemployment benefits which are
later determined to have been overpaid cannot be recovered from the
claimant as long as the claimant received the benefits in good faith,
did not make a false statement or representation, and did not willfully
conceal any pertinent fact in connection with his or her claim. However,
despite these requirements, data from the U.S. Department of Labor
shows that as of March 1, 2021, the State has not granted any waivers
for overpayments throughout the duration of the pandemic and yet has
continued to recover a total of $93.4 million in overpaid benefits
during 2020.
The enormous rise in unemployment claims during the COVID-19 pandemic
has only exacerbated the ongoing issues with the New York State unem-
ployment system and the overpayment of benefits. Amid the confusion of
businesses closing, people losing their jobs, and navigating the
outdated and complex UI system, it is reasonable to understand how some
individuals might have made honest mistakes and unintentional errors on
their unemployment applications, with no intent to defraud the system.
And yet, as our economy moves forward to recover from the impacts of the
pandemic, many of these claimants are now being asked to pay back debts
and penalties that they never knew had incurred in the first place. To
address these inequities, this bill would allow claimants that have been
overpaid benefits to which they were not entitled during the COVID-19
pandemic to apply for a waiver to have these overpayments forgiven.
Going forward, claimants would also not be held. liable for overpayments
of state or federal unemployment benefits, as permitted under federal
law, provided that the overpayment was not due to fraud or fault on the
part of the claimant and the recovery of such overpayment would be
against equity and good conscience.
LEGISLATIVE HISTORY:
2022: A6666 - Referred to Labor
2023-2024: A3647 - Referred to Labor; enacting clause stricken
FISCAL IMPLICATIONS:
To be determined.
EFFECTIVE DATE:
This act would take effect immediately and would be deemed to have been
in full force and effect on and after March 9, 2020.
STATE OF NEW YORK
________________________________________________________________________
8928--A
IN ASSEMBLY
January 30, 2024
___________
Introduced by M. of A. BRONSON -- read once and referred to the Commit-
tee on Labor -- recommitted to the Committee on Labor in accordance
with Assembly Rule 3, sec. 2 -- committee discharged, bill amended,
ordered reprinted as amended and recommitted to said committee
AN ACT to amend the labor law, in relation to the recovery of overpay-
ments of unemployment benefits; to direct the department of labor to
provide claimants who have previously been denied waivers with appli-
cations for individual waivers; and to repeal certain provisions of
such law relating thereto
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The labor law is amended by adding a new section 594-a to
2 read as follows:
3 § 594-a. Recovery of overpayments. (1) Definitions. For the purposes
4 of this section:
5 (a) "Without fault" means the claimant did not, with the intent to
6 receive benefits, intentionally supply false information or knowingly
7 omit information, which directly resulted in the department issuing
8 benefits to which the claimant knew they were not entitled;
9 (b) "Final determination" means thirty days after appeal rights have
10 been exhausted or abandoned.
11 (c) "Willful" means intentional and deliberate.
12 (2) Notwithstanding any provision of section five hundred ninety-four
13 of this title to the contrary, any claimant who has received benefits
14 under the provisions of this article on or after January twenty-seventh,
15 two thousand twenty, to which they were not entitled shall not be held
16 liable for the amounts overpaid provided that all of the following
17 conditions exist:
18 (a) Such overpayment was not due to fraud or due to a willful false
19 statement or misrepresentation;
20 (b) Such overpayment was received without fault on the part of the
21 claimant; and
22 (c) The recovery of such overpayment would be against equity and good
23 conscience.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD02352-05-4
A. 8928--A 2
1 (3) When determining whether an overpayment was received without fault
2 on the part of the claimant, the commissioner shall consider the follow-
3 ing factors:
4 (a) The nature and cause of such overpayment and the capacity of the
5 claimant to recognize the error resulting in such overpayment;
6 (b) Whether the claimant knew or reasonably should have known that he
7 or she was not lawfully entitled to receive such benefits;
8 (c) Whether the benefits were received or retained because of the
9 claimant's good faith reliance on an administrative or departmental
10 error; and
11 (d) Whether the claimant willfully reported or failed to report infor-
12 mation which resulted in such overpayment.
13 (4) (a) There shall be a presumption that the claimant is without
14 fault if:
15 (i) the department provided conflicting, changing, or confusing infor-
16 mation or instructions;
17 (ii) the department took more than six months to implement a federal
18 law regarding proof of eligibility from claimants;
19 (iii) the claimant was unable to reach the department despite their
20 best efforts to inquire or clarify information the individual needed to
21 provide due to language, education, literacy, disability or similar
22 barriers;
23 (iv) the claimant was unable to understand the department's notices or
24 directives due to language, education, literacy, disability or other
25 similar barriers;
26 (v) the claimant chose a reason for separation which is legally incor-
27 rect, though reasonable for the claimant to have selected under the
28 circumstances; or
29 (vi) the claimant had assistance in filing a claim, certifying, or
30 otherwise responding to the department and the claimant's assistant did
31 not confirm required information with the claimant or misunderstood such
32 information provided by the claimant, resulting in inaccurate informa-
33 tion being submitted without the claimant's knowledge.
34 (b) There shall be a presumption that the payment of benefits is with-
35 out fault if the overpayment was due to agency error or mistake or the
36 employer provided incorrect or untimely information. Receipt or
37 possession of the claimants' unemployment insurance handbook shall not
38 create a presumption that the claimant was on notice of the handbook's
39 contents nor shall receipt or possession of the handbook be used against
40 the claimant on points of fact or law.
41 (5) Recovery of any overpayment would be against equity and good
42 conscience if:
43 (a) recovery would cause financial hardship to the person from whom
44 recovery is sought;
45 (b) the recipient of the overpayment can show, regardless of their
46 financial situation, that repayment would cause them to relinquish a
47 valuable right or change their position for the worse, including, but
48 not limited to, signing a lease, taking out a loan, or declining other
49 state or federal assistance in reliance on receipt of unemployment
50 insurance benefits;
51 (c) the individual or their household receives social security income,
52 supplemental security income, social security disability, medicaid,
53 medicare, free or reduced public school lunch, FIP, temporary assist-
54 ance, supplemental nutrition assistance program benefits, nutrition
55 benefits provided as part of the special supplemental nutrition program
56 for women, infants and children (WIC), home energy assistance program
A. 8928--A 3
1 benefits, senior citizen rent increase exemption, disability rent
2 increase exemption, rental subsidy pursuant to federal or state law, is
3 at or below four hundred percent of the federal poverty guidelines or
4 living in project-based subsidized housing or any substantially equiv-
5 alent successor programs to the aforementioned benefits programs;
6 (d) the individual used the unemployment benefits to meet their ordi-
7 nary living expenses, including, but not limited to, food, rent, medical
8 costs or insurance, dental bills or insurance, school loans, school
9 fees, utilities, child care, mortgage payments, transportation, purchase
10 or maintenance of a car or equipment needed for employment or self-em-
11 ployment, or operating expenses for self-employment; or
12 (e) there is any other reason for which recovery of the overpayment
13 would be against equity and good conscience under the circumstances.
14 (6) (a) In the event that a new determination by the commissioner or a
15 decision by a referee, the appeal board, or a court results in a
16 decrease or denial of any benefits previously allowed, or at any other
17 time it has been determined that an overpayment has occurred, the claim-
18 ant shall be notified in writing, by mail or electronically, within
19 fifteen days of such determination or decision of his or her right to
20 appeal such determination or decision and to request a waiver of recov-
21 ery of such overpayment. Such notice shall include, but shall not be
22 limited to:
23 (i) The total amount of such overpayment and the cause of such over-
24 payment;
25 (ii) The schedule of repayment for such amounts overpaid;
26 (iii) The means by which the commissioner is entitled to collect or
27 recover such overpayment;
28 (iv) An explanation of the claimant's right to appeal such determi-
29 nation or decision in accordance with the provisions of this article and
30 any rules and regulations promulgated thereunder;
31 (v) An explanation of the standards by which a claimant shall not be
32 found liable for the amounts overpaid, as set forth in this section;
33 (vi) The process by which the claimant may request and obtain a waiver
34 of recovery of such overpayment, including a copy of the waiver applica-
35 tion; and
36 (vii) the amount that is waived and the reason why any or all of the
37 overpayment was not waived.
38 (b) The commissioner shall review each waiver request in a manner
39 consistent with this section to determine whether the claimant shall be
40 held liable for any amounts overpaid. Any claimant who is found not to
41 be liable for any amounts overpaid shall be entitled to receive a full
42 waiver of such overpayment and any previously imposed penalties on such
43 overpayment must be rescinded accordingly.
44 (c) (i) Any claimant who disagrees with a determination regarding a
45 waiver may request a hearing within sixty days of receipt of the deter-
46 mination.
47 (ii) Claimants shall have all appeals rights as provided under title
48 eight of this article, except that referees may extend the time fixed
49 for requesting a hearing upon good cause shown.
50 (iii) When a determination is made that the claimant was at fault, the
51 referee and unemployment insurance appeals board shall review the deter-
52 mination of fault and any willful misrepresentations de novo.
53 (d) The department shall within thirty days of the effective date of
54 this section develop and implement a process by which claimants may
55 request and obtain an individual waiver application by phone, fax, mail,
56 and through the department's two-way communication system. The applica-
A. 8928--A 4
1 tion shall be made available to all claimants without regard to a deter-
2 mination of fault or willfulness in the receipt of the claimant's over-
3 payment.
4 (e) All notifications shall be translated into the ten most commonly
5 spoken languages in the state.
6 (f) Any funds recouped or repaid prior to the granting of a waiver
7 under this section shall be returned to the claimant as provided under
8 subdivision five of this section.
9 (7) (a) Upon the denial of any waiver request, or upon any other
10 determination by the commissioner or a decision by a referee, the appeal
11 board, or a court that a claimant shall be held liable for any overpay-
12 ment, the claimant shall be notified in writing, by mail or electron-
13 ically, within fifteen days of such determination or decision. Such
14 notice shall set forth the reason for such denial, if applicable, and
15 his or her right to request an adjustment to his or her repayment sched-
16 ule.
17 (b) Where a waiver request is denied, a claimant shall be offered a
18 repayment plan to pay down the amount owed over a period of time no less
19 than three years. The duration of a repayment plan shall be based on the
20 claimant's ability to pay. Upon a showing of financial hardship, repay-
21 ment plans shall be set for an indefinite period with minimum payments
22 of no less than five dollars per month. Nothing in this section shall
23 impede the ability of the department to discharge, write off, or waive
24 any overpayment.
25 (c) The commissioner shall grant an adjustment to the claimant's
26 repayment schedule if at any time the claimant is able to demonstrate
27 that there has been a change in his or her financial condition which
28 warrants such adjustment. The department shall notify claimants of the
29 ability to seek a modified repayment plan in writing upon the claimant's
30 entry into a repayment plan.
31 § 2. Subdivision 4 of section 597 of the labor law is REPEALED.
32 § 3. Within sixty days of the effective date of this act, the depart-
33 ment of labor shall provide claimants who have previously been denied
34 waivers between March 9, 2020, and the effective date of this act with
35 applications for individual waivers. If it is found that the department
36 has collected benefits from a claimant as a result of the recovery of an
37 overpayment which would be barred under the provisions of this act, the
38 department shall refund such benefits to the claimant within thirty days
39 of the approval of the waiver.
40 § 4. This act shall take effect immediately and shall be deemed to
41 have been in full force and effect on and after March 9, 2020.
