Backlogged unemployment checks to flow again

SACRAMENTO, Calif. (AP) California's labor secretary has ordered the state's Employment Development Department to immediately begin distributing unemployment checks that have been delayed because of computer problems.

Marty Morgenstern said in a memo to the EDD on Tuesday that it should not wait to verify whether people are eligible for the benefits before issuing the payments. Morgenstern said eligibility would have to be determined later, with any overpayments collected at that time.

The memo was reported by the Sacramento Bee. Eyewitness News also obtained a copy from Morgenstern's office.

The labor secretary calls the backlog in claims "unacceptable," noting the delays are causing real hardships for people depending on benefits.

"Consequently, I am directing EDD to immediately begin the process of paying backlogged claims for continued UI (unemployment insurance) benefits prior to a final determination of eligibility." the memo reads

EDD spokeswoman Loree Levy said the glitch happened when the department switched to a new computer system. "We implemented our new internal portion of a new payment processing over the long Labor Day weekend," she told Eyewitness News by phone on Wednesday.

Just after the weekend, Eyewitness News heard from viewers who were not getting their benefits. At the time, EDD said the problem was being fixed, and "most" claimants were getting their payments. But, the problem just got worse.

By this week more claims were coming in, and the number of delayed cases grew to some 80,000.

Late Wednesday, EDD had another update on the situation. "EDD is now implementing our latest alternatives developed for liquidating our current backlog," the email said. "This will allow us to move quickly to issue payment and then work to complete the more time-consuming eligibility review required at a later date."

Levy had explained that the new computer system is an upgrade to EDD's 30-year-old payment processing system. And, while most claims could be automatically reviewed for eligibility, others that are more complex required "manual" review. That slowed things down more than expected.

Since last December, Eyewitness News has investigated a large number of complaints about EDD. Many viewers said they could never reach them by phone or through email. In February, Eyewitenss News went to the EDD Sacramento office to ask about those problems.

Levy said the department was dealing with a huge number of claims and budget cuts. The department also said things would get better because EDD was working to improve various online systems.

But, the complaints continued coming in to Eyewitness News, and last year we asked for an interview with the governor. We were referred back to EDD. Eyewitness News made that request again when the new problem surfaced, and was again told EDD would be the only department to respond.

With Labor Secretary Morgenstern ordering EDD to make the immediate payments, Eyewitness News asked a spokesman if he could also help deal with the other issues. The spokesman said Morgenstern is focusing on the current problem.

As of Wednesday, EDD's update said they started the day with a certification backlog of a bit less than 73,000 claims.

"However, the number of claimants moving into the backlog is declining and when combined with extra processing efforts on the backlog, the EDD is making progress catching up with any claimants waiting beyond the ten days for payment," it says.

EDD says they've tried other strategies to deal with the computer glitch and backlog. They've put more staff into processing claims, and had them working overtime including weekends. Staff from other agencies have also been brought in to help.

They call the "pay now, verify later" effort their latest alternative.

"Some (people) will see payments just as quickly as tomorrow, others will take a few more days," Levy said Wednesday afternoon. She said they hope for progress every day. "We're really hoping to liquidate a huge percentage of this backlog by the end of the weekend," she said.

EDD's statement also apologized for the delays. "We are committed to doing everything possible to resolve the backlog issue and get customers cleared of any further undue interruptions," it says.

Levy also said letters were going out on Wednesday to let people know their claims had been received. She advised people to watch the EDD Facebook page for updates on the situation.

As people get the immediate payments, EDD says some may get notified later about overpayments when the eligibility is reviewed after the fact.

"We understand that it may take more time to investigate some of the claim certifications after payment have been made," the update reads. "but unemployed Californians are truly struggling to pay their rent and mortgages and put food on their tables."