Under Pennsylvania unemployment compensation law, more and more, claimants are receiving notices of overpayment. We have seen a steady rise in the number of people who get such worrisome notices, wondering if they will be fined, put in jail, or lose their home.
In dealing with such inquiries, it is important to distinguish between the two types of overpayment situations. One type of overpayment of unemployment compensation benefits is a fault overpayment. The second type of overpayment is referred to as non-fault (or sometimes also referred to as a “non-fraud”) overpayment.
Non-Fault Overpayment of Unemployment Compensation
While a non-fault overpayment may result for a variety of reasons, the main thing that makes it a non-fault overpayment is the receipt of unemployment compensation benefits in the absence of any improper or fraudulent conduct on the part of the recipient.
Simply stated, if you did not use deception to obtain benefits, such as lying about your eligibility to the Department of Labor & Industry when pursuing benefits, and if you believed that you were entitled to the benefits you received, then this will generally be regarded as a non-fault overpayment situation.
Details of Non-Fault Overpayment
When you are the subject of a non-fault overpayment, the Department will seek to have you pay back the benefits it believes you received in error. It will generally not come after you directly but, instead, will seek to repay itself by deducting money from future benefit checks.
This process is called “recoupment.” The Department is allowed to deduct (i.e., recoup) your future benefit payments for up to 3 years after the year in which you received benefits. Based on existing law, after 3 years from the benefit year, they cannot take any such action against you.
Even if the Department does make a deduction from your future benefits (i.e., within 3 years that you received the overpayment), they can only deduct up to 1/3 of the weekly benefit amount to which a person is entitled.
Even though the law also provides for a voluntary repayment to the Department, it doesn’t take much to understand that if all that will happen to someone for a non-fault overpayment is that they might have their benefits decreased sometime within the next 3 years if they need to apply for benefits during that time, then not too many people will be concerned about making repayments – certainly none of the voluntary kind.
Get Help with Non-Fault Overpayments
That said, many times it is unclear if the overpayment was a fault or a non-fault overpayment. Furthermore, even when it appears as if it is a non-fault overpayment, you do not want to do or say anything that will turn in into a fault overpayment in which case collection efforts can be much harsher. I will discuss fault overpayment collections by the Department in a subsequent blog. For now, if you have a non-fault or a fault determination, contact the Pennsylvania unemployment compensation lawyers at Trinity Law for help as soon as possible.