Virginia still ranks last in nation for quickly resolving issues with unemployment insurance claims

Despite assurances that state officials were working to address long delays in processing unemployment claims, Virginia continues to rank last in the country in key performance metrics tracked by the U.S. Department of Labor.

The federal data shows the situation has only gotten worse as the pandemic continued, even as businesses have begun reopening and new claims have dropped.

The number of disputed claims reviewed within three weeks — the maximum amount of time federal officials say it should take — dropped from 4.1 percent at the end of last year to 2.4 percent in the first three months of this year. Both figures put Virginia dead last in federal rankings.

For claims awaiting appeal, the average wait time now sits at 247 days, the third highest in the country, according to the Department of Labor.

In practice, that means some Virginians will have been left waiting a year or more for financial assistance that was intended to serve as an emergency stop gap after an unexpected job loss.

It’s unclear why Virginia’s unemployment insurance program has fared so poorly, but advocates for people stuck in the queue say the state has been slow to realize the severity of the problem.

“I think the pandemic caught everybody by surprise and claims volume was up tremendously, but the fact is that a lot of states acted much quicker and with much more intentionality to realize how big the crisis was and how ill equipped their state agencies were to respond to it,” said Pat Levy-Lavelle, an attorney with the Charlottesville-based Legal Aid Justice Center who specializes in public benefits and has been helping clients with claims.

The Legal Aid Justice Center and several other legal aid groups around the state filed a class-action lawsuit against the Virginia Employment Commission this month, arguing that long delays violate federal and state law, and due process guarantees in the U.S. Constitution.

“The financial loss has been tremendous, and emotionally you are just a wreck,” said Lenita Gibson, one of the five initial plaintiffs, in a statement. “It’s been horrible. Never in my wildest dreams did I think I’d be treated like this. It doesn’t make any sense.”

The Virginia Employment Commission would not comment on the lawsuit, but Gov. Ralph Northam’s spokeswoman pointed out that many applicants have received benefits. “Over the past year, VEC has paid out $13 billion in benefits to 1.3 million people — more people than over the last 10 years combined. It’s important to remember that not everyone who applies for benefits will be eligible, and appeals require a longer process,” she said.

The state’s handling of unemployment insurance has also drawn criticism from U.S. Sen. Mark Warner, a Virginia Democrat, who wrote Northam in March urging him to accelerate benefit distributions. “From Newport News to Henrico to Alexandria, constituents are contacting my office from every corner of the commonwealth with desperate requests for relief,” he wrote. “Some of them have waited 3 months, others have waited 11 months, and many are struggling to feed their children and keep a roof over their heads.”

Northam’s administration pointed to a variety of problems, many of which it had identified early in the pandemic, including outdated technology and a shortage of employees qualified to review claims.

Megan Healy, Northam’s chief workforce adviser, said last week the agency had begun reassigning and retraining staff to help work through the backlog. But she said changes to federal programs in December, which restarted unemployment benefits for many people, interrupted the effort because it led to a slew of new applications.

“We had to move people off the back lines and onto the frontlines to help process those claims,” she said.

Healy also said that wait times continue to get longer in part because applications have gotten more complicated and less clear cut than in the beginning of the pandemic, which she said has exacerbated the problem. Most of the claims that are held up involve disputes in which employers claim the applicant is not entitled to benefits because they voluntarily quit or refused work, she said.

Healy said the state is in negotiations with a private vendor to bring on an additional 100 staffers to help with adjudications, which she said would roughly double the current staff.

Levy-Lavelle called it a welcome development, but noted Maryland had taken a similar step in February and had gone significantly further, bringing on more than 300 additional adjudicators. He said he worried even with a staff of 200, applicants will continue to face long delays.

“It’s better now than even later,” he said. “I think it’s unfortunate that Virginia has been as slow and taken as long as it has to realize the scope of the crisis. And to be honest I don’t think they even own up to exactly how bad it is here, even now.”