Massachusetts announces plan to waive up to $1.6 billion in non-fraudulent unemployment insurance overpayments

Massachusetts Gov. Charlie Baker’s (R) administration announced on April 14 a plan to waive $1.6 billion in non-fraudulent unemployment insurance overpayment collections. The plan would offer waivers for some workers who claimed benefits during the pandemic but were asked to repay them because the state deemed them ineligible after the payment of benefits.

In total, the administration would write off $475 million in overpaid benefits related to insufficient identity verification. The state argued many of those overpayments involved cases of identity theft where affected claimants never received benefits.

The US Department of Labor (USDOL) also granted a partial blanket waiver for all Federal Pandemic Unemployment Assistance (PUA) overpayments related to insufficient proof-of-work between the weeks ending Jan. 2 and March 20, 2021. The partial blanket waiver will cover about $349 million of overpayments.

The state is also planning to file emergency regulations to issue waivers for up to $782 million additional non-fraudulent state unemployment insurance and federal PUA overpayments not covered under the USDOL waiver. The state did not release details on who would qualify for forgiveness under the emergency regulations.

Unemployment insurance is a joint federal and state program that provides temporary monetary benefits to eligible laid-off workers who are actively seeking new employment. Qualifying individuals receive unemployment compensation as a percentage of their lost wages in the form of weekly cash benefits while they search for new employment.

The federal government oversees the general administration of state unemployment insurance programs. The states control the specific features of their unemployment insurance programs, such as eligibility requirements and length of benefits.

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