Virginia Employment Commission’s overpayments shouldn’t cause people stress – or heartburn

Picture this scenario: A friend offers you a slice of scrumptious, calorie-laden, chocolate cake – no charge! You devour the cake, delighting in its sweet decadence. 

A few hours later, long after you’ve discarded your plate, the friend demands you pay for the dessert you’d thought was free. He says he erred in calculating his costs, you see, and shouldn’t have been so altruistic.

Something like that is playing out right now courtesy of the much-criticized Virginia Employment Commission. Unfortunately for laid-off workers during the pandemic, the VEC now wants money back for its errors in calculating payments. 

“We are legally bound by federal directive to establish overpayments where benefits were paid improperly,” Joyce Fogg, a commission spokeswoman, told me by email. “ We are allowing individuals to apply for waivers if they are overpaid through no fault of their own.”

That’s understandable. How the VEC goes after the money, though, could use a lighter touch. A July 1 news release noted the Attorney General’s Office and an outside collection agency could be coming after Virginians.

A state law that expired June 30 had allowed the commission to suspend collection of overpayments. Virginia, by the way, is just one of 12 states that doesn’t have a permanent overpayment waiver provision, according to the nonprofit National Employment Law Project. 

But most folks in this category spent that money long ago. While out of a job and seeking a new one, they needed the cash for things like food, rent, utility bills and other essentials. 

I’m all for fiscal responsibility and recouping tax dollars, but c’mon: It’s highly unlikely those Virginians spent benefits recklessly during the (ongoing) COVID-19 crisis. By the way, the feds have distributed $216.4 million to the VEC for pandemic-related operations. 

Plus, given all the previous missteps, delays and screwups with the agency, jobless folks thought the agency had finally gotten its act together and issued the correct amounts. 

“If everything was approved, why am I being asked to repay?” noted Jessica Terry, a 40-year-old mother of four who lives in Hanover County. 

Why, indeed. 

Terry told me the VEC said she could be on the hook for $20,000 in overpayments. Terry, who recently divorced, homeschools her children, ages 6 to 15. She’s had trouble finding a new job outside the home.

I’m not including con artists or fraudsters in my plea for leniency. State and federal officials have seen their share of deliberate abuse of government funds since the pandemic began in early 2020. Those thieves deserve the prison time and fines that judges have meted out. 

Scofflaws include a Pound man who conspired with others to defraud nearly a half-million dollars in pandemic-related jobless benefits; he got a federal prison term for his deceit. A federal court also sentenced a 31-year-old Jonesville woman in late 2021 for defrauding the government of more than $1.5 million in a similar scheme. 

I’m talking instead of nearly $860 million the VEC is targeting in more than 360,000 cases since the pandemic’s onset. Almost 2 million requests for jobless benefits came in, swamping an already dysfunctional system. 

You may recall the news stories. If you sought benefits as COVID-19 shut down businesses, you probably experienced the “unprecedented frustration and failure,” as one state senator put it.

Legislative auditors assailed shortcomings by management and poor oversight by the administration of then-Gov. Ralph Northam: inaction on increasing staff; an IT upgrade years behind schedule; call centers where fewer than 3 percent of calls were being answered, frustrating laid-off Virginians desperate for state help.

People who finally received payments, possibly after months of delays, assumed everything was good to go and each dollar OK to spend. 

Repayment won’t be easy for people like Terry: “It’s been extremely stressful.”

Attorneys who sued VEC for deficiencies last year and advocates for low-income Virginians say they understand the requirement to collect overpayments. “But there’s an open question about priorities,” Pat Levy-Lavelle, senior intake attorney with the Legal Aid Justice Center, told me Thursday.

The lawsuit was eventually settled, with VEC promising to improve practices.

Levy-Lavelle noted thousands of Virginians are still seeking benefits. Others, he said, have faced average wait times of 10 months following an initial appeal to seek a higher-level decision. 

Steve Fischbach is litigation director at the Virginia Poverty Law Center, another attorney in the suit. He thinks the VEC needs to tout the remedies for affected Virginians. 

“A lot of people applied for benefits in good faith,” he said. “But somehow they weren’t eligible to receive that money.” 

So why not issue more waivers – and better publicize the option? The agency told me it had approved more than 24,600 waivers totaling over $87.3 million. 

“Some individuals may be eligible for a state waiver – covering overpayments from both state and federal programs … that occurred during the benefit week starting March 21, 2020, through the week ending July 3, 2021, where the claimant is at no fault for the overpayment and requiring the overpayment is contrary to good conscience and equity,” Fogg noted. 

“Claimants with an outstanding overpayment balance are notified of the availability to make an application for the waiver by the VEC,” she added.

Customers with questions about billing statements should call the commission’s Benefit Payment Unit at 804-786-8593. I got through to an actual person on Thursday, thankfully. 

Because if you were told you did everything right to get your slice of cake, you shouldn’t later face extra costs – or heartburn.