Health Investigations

At the daily coronavirus briefing on Monday, Gov. Andy Beshear acknowledged that Kentucky mistakenly overpaid people who requested unemployment benefits — and advised recipients to save that money if they’re notified of an investigation because the state may eventually ask for it back.

“We ask people, obviously, to save that money,” Beshear said while under quarantine at the Governor’s mansion.

As the pandemic stretches on, many Kentuckians who received unemployment insurance payments are learning the unemployment office deemed them, retroactively, ineligible. As KyCIR reported last week, many filed their unemployment claims after Beshear said his administration was expanding coverage to people who were afraid of catching the virus at work — only to be disqualified months later because the state said they took a “voluntary leave of absence.” 

People who owe overpayment debts to state and federal unemployment agencies may be forced into a payment plan, face civil action or have future benefits docked to pay down the debt.

Beshear said the state will handle the overpayments issue eventually, but that the state’s top priority right now is to resolve the over 90,000 unemployment claims that were filed but haven’t been processed.

In the meantime, Beshear said people who think they may have been overpaid should watch their emails for an overpayment notice and save the money they’ve received. 

Beshear said the state will get to the overpayments issue eventually. 

“People who believe they are overpaid should wait for an overpayment determination before repaying,” Beshear said. “Claimants should watch their email for overpayment notices because the appeal period is limited.” Claimants have 15 days to file an appeal one they are notified of an overpayment.

Other states are also clawing back unemployment overpayments, as Beshear noted on Monday, but Kentucky’s unemployment office has been especially harried in its response to the pandemic. In May, the state fired its newly installed director of unemployment insurance at a time when no state had a larger share of its workforce on unemployment than Kentucky. The system required a $865 million loan from the federal government in June to bolster the unemployment insurance trust fund.

KyCIR reported in August that Kentucky’s unemployment office had violated federal rules by automatically approving self employed or independent contractors who applied for unemployment, likely creating overpayments like the ones addressed by Beshear on Monday. Kentucky entered into a corrective action plan with the federal Department of Labor that includes pursuing overpayment debts that stem from the state’s mishandling of unemployment claims.

Beshear’s office previously told KyCIR the overpayments for people who self-quarantined over a reasonable fear of catching COVID-19 at work were the result of shifting policies from the federal government.

A spokesperson for the Department of Labor, however, said in a statement that guidance alluded to by the governor’s office “did not change any policies, but clarified operating guidance based on state questions.”

Kevin Kinnaird, an information specialist at the Kentucky Labor Cabinet, said that the federal government’s guidance did in fact change. 

“Whether you call it changing or clarifying, the Department of Labor’s position shifted,” Kinnaird said in an emailed response to the federal government’s assertion.

“The state disagrees with the tightening of eligibility in the midst of a pandemic and global recession, when millions are struggling, and Kentucky will join other states to request flexibility to waive overpayments for Kentuckians who are self-quarantining during this pandemic to protect their health or reduce exposure for a loved one at higher risk,” Kinniard said.

Most states allow their respective unemployment agencies to waive overpayment debts when the claimant is not at fault. Kentucky is one of just 10 states without such a provision in state law.