How to Handle Overpaying Unemployment Benefits

Overpayments on insurance benefits are, unfortunately, all too common in the United States. A national statistic states that these overpayments top $3 billion. The good news is if you’re a part of that number, you don’t need to stay there. Here’s how to handle overpaying unemployment benefits.

Start by Contesting the Claim

In a perfect world, you would monitor every claim that comes in and check in on current claims each week to make sure they still qualify. Regrettably, this world isn’t perfect, and sometimes these things get missed. Fortunately, you can correct an error like this.

If you notice a former employee who’s receiving unemployment insurance benefits and shouldn’t be, you can submit an appeal to contest the claim. As a result, the employee will receive a notice that their benefits have been stopped with instructions on what to do next.

They may choose to appeal, which means a hearing will occur where you’ll present evidence supporting your claim. It’s important to be ready for this outcome regardless so you can state your case effectively.

Get Repaid from the Former Employee

After you successfully contest a claim, the employee will be notified that they must pay it back, usually with interest. How much is repaid depends on the reason for the overpayment. In some situations, it may be a mistake not at the fault of the recipient, and they aren’t liable for anything beyond basic repayment.

The opposite is true, however, for those who are intentionally misleading on the paperwork. If caught being purposefully dishonest, it’s likely they’ll pay back up to double what they received with the associated penalties.

Avoid Overpayments from the Beginning

The best way to avoid overpayments is vigilant monitoring. Unfortunately, as you may know, this isn’t possible based on your staff size and various roles. You may not have one dedicated person to UI, and the people who do assist probably have another job to do.

Don’t worry – we have a solution! Several, in fact, all designed to meet your unique company needs. Whether you just need customizable software or a full-service consultant to assist you, Unemployment Tracker is here to help you cut UI costs and save money. Contact us today to see how we can help you.