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.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A3647
SPONSOR: Joyner TITLE OF BILL:
An act to amend the labor law, in relation to the recovery of overpay-
ments of unemployment benefits; and to repeal certain provisions of such
law relating thereto
PURPOSE OR GENERAL IDEA OF BILL:
The purpose of this bill is 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.
PRIOR LEGISLATIVE HISTORY:
05/05/22 Refered to Labor
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
To be determined.
EFFECTIVE DATE:
This act shall take effect immediately and shall be deemed to have been
in full force and effect on and after March 9, 2020.
STATE OF NEW YORK
________________________________________________________________________
3647
2023-2024 Regular Sessions
IN ASSEMBLY
February 3, 2023
___________
Introduced by M. of A. JOYNER -- read once and referred to the Committee
on Labor
AN ACT to amend the labor law, in relation to the recovery of overpay-
ments of unemployment benefits; 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) Notwithstanding any provision
4 of section five hundred ninety-four of this title to the contrary, any
5 claimant who has received benefits under the provisions of this article
6 to which they were not entitled shall not be held liable for the amounts
7 overpaid provided that all of the following conditions exist:
8 (a) Such overpayment was not due to fraud or due to a willful false
9 statement or misrepresentation;
10 (b) Such overpayment was received without fault on the part of the
11 claimant; and
12 (c) The recovery of such overpayment would be against equity and good
13 conscience.
14 (2) Notwithstanding any provision of section five hundred ninety-four
15 of this title to the contrary, any claimant who has received benefits
16 paid under any federal unemployment and extended unemployment programs
17 administered by the department to which they were not entitled shall not
18 be held liable for the amounts overpaid, to the extent permitted under
19 federal law, if all of the following conditions exist:
20 (a) Such overpayment was not due to fraud or due to a willful false
21 statement or misrepresentation;
22 (b) Such overpayment was received without fault on the part of the
23 claimant; and
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD02352-01-3
A. 3647 2
1 (c) The recovery of such overpayment would be against equity and good
2 conscience.
3 (3) When determining whether an overpayment was received without fault
4 on the part of the claimant, the commissioner shall consider the follow-
5 ing factors:
6 (a) The nature and cause of such overpayment and the capacity of the
7 claimant to recognize the error resulting in such overpayment;
8 (b) Whether the claimant knew or reasonably should have known that he
9 or she was not lawfully entitled to receive such benefits;
10 (c) Whether the benefits were received or retained because of the
11 claimant's good faith reliance on an administrative or departmental
12 error; and
13 (d) Whether the claimant negligently reported or failed to report
14 information which resulted in such overpayment.
15 (4) When determining whether the recovery of any overpayment would be
16 against equity and good conscience, the commissioner shall consider if
17 such repayment would impose extraordinary hardship, including financial
18 hardship, on the claimant or the claimant's household.
19 (5) (a) In the event that a new determination by the commissioner or a
20 decision by a referee, the appeal board, or a court results in a
21 decrease or denial of any benefits previously allowed, or at any other
22 time it has been determined that an overpayment has occurred, the claim-
23 ant shall be notified in writing, by mail or electronically, within
24 fifteen days of such determination or decision of his or her right to
25 appeal such determination or decision and to request a waiver of recov-
26 ery of such overpayment. Such notice shall include, but shall not be
27 limited to:
28 (i) The total amount of such overpayment and the cause of such over-
29 payment;
30 (ii) The schedule of repayment for such amounts overpaid;
31 (iii) The means by which the commissioner is entitled to collect or
32 recover such overpayment;
33 (iv) An explanation of the claimant's right to appeal such determi-
34 nation or decision in accordance with the provisions of this article and
35 any rules and regulations promulgated thereunder;
36 (v) An explanation of the standards by which a claimant shall not be
37 found liable for the amounts overpaid, as set forth in this section; and
38 (vi) The process by which the claimant may request and obtain a waiver
39 of recovery of such overpayment.
40 (b) The commissioner shall review each waiver request in a manner
41 consistent with conditions set forth in subdivisions one and two of this
42 section to determine whether the claimant shall be held liable for any
43 amounts overpaid. Any claimant who is found not to be liable for any
44 amounts overpaid shall be entitled to receive a full waiver of such
45 overpayment and any penalties and/or interest incurred as a result of
46 such overpayment.
47 (6) (a) Upon the denial of any waiver request, or upon any other
48 determination by the commissioner or a decision by a referee, the appeal
49 board, or a court that a claimant shall be held liable for any overpay-
50 ment, the claimant shall be notified in writing, by mail or electron-
51 ically, within fifteen days of such determination or decision. Such
52 notice shall set forth the reason for such denial, if applicable, and
53 his or her right to request an adjustment to his or her repayment sched-
54 ule.
55 (b) The commissioner shall grant an adjustment to the claimant's
56 repayment schedule if at any time the claimant is able to demonstrate
A. 3647 3
1 that there has been a material change in his or her financial condition
2 which warrants such adjustment.
3 § 2. Subdivision 4 of section 597 of the labor law is REPEALED.
4 § 3. This act shall take effect immediately and shall be deemed to
5 have been in full force and effect on and after March 9, 2020.
