BOSTON — Thousands of workers who repaid overpayments for unemployment benefits during the pandemic will soon receive a refund from the state.
Reimbursements include more than $15.3 million reimbursed by 3,168 job seekers whose overpayment debts are cleared by a federal waiver, according to figures from the state Executive Office of Labor Development and Workforce.
An additional $4.9 million was refunded by 10,174 claimants who can request refunds under a separate waiver process for state and federal overpayments.
A notice sent by the state’s Department of Unemployed Assistance to eligible claimants explains that they do not need to make more payments and will get a refund or credit.
“If you made a payment for this debt, you will receive your refund by direct deposit if that was your method of payment,” the notice reads. “If your payment method was a debit card, please update your account’s payment method for direct deposit or make sure your mailing address is correct, as we will send you a check if no direct deposit account is not available.”
Massachusetts paid out a record $33 billion in state and federal unemployment and unemployment benefits between 2020 and 2021 as government-imposed shutdowns to stop the spread of COVID-19 sidelined hundreds of thousands of workers. The state was forced to borrow about $2.2 billion from the federal government to continue paying the claims.
But in the scramble to process an unprecedented number of claims, about $2.7 billion in so-called overpayments were paid to 719,000 laid-off workers who received benefits to which they were later determined to be ineligible.
Last month, the U.S. Department of Labor partially approved the state’s request for a blanket waiver for non-fraudulent overpayments through Pandemic Unemployment Assistance and other federal unemployment programs. unemployment.
But the waiver only covers overpayments received from the week ending January 2, 2021 through the week ending March 20, 2021, according to the agency.
State labor officials say the biggest driver of overpayments among Massachusetts claimants was changes in federal guidelines for the PUA program. Those changes have resulted in overpayment determinations for more than $1 billion in claims already paid, according to state labor officials.
The federal waiver combined with additional state relief will resolve up to $1.6 billion in overpayments, or approximately 71% of all outstanding overpayments.
Of this amount, approximately $349 million will be erased by the federal waiver, while an additional $509 million in overpayments will be offset by state waivers.
Another $748 million in overpayments — some of which involve identity verification issues — will be addressed through other waiver agreements, the agency said.
Claimants can be charged overpayments for a litany of reasons. In some cases, those who applied for benefits thought they were eligible, but were not. Others made honest mistakes by incorrectly completing the required forms. In other cases, clerical errors were made by the state in its rush to approve a tidal wave of claims.
But state labor officials argue that the majority of those overpayments were related to abrupt changes in federal guidelines.
Christian M. Wade covers the Massachusetts Statehouse for North of Boston Media Group newspapers and websites. Email him at [email protected]