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: A6666
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:
New bill.
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.
