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Received Overpayment

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Ilovelamp

Junior Member
What is the name of your state (only U.S. law)? PA

Hello All,
I need advice on my situation. I am PA resident and was laid off from my job. My last day of employment was November 30th. At that point, I was still in the process of negotiating a severance package with my employer.

On Dec 4th, I applied for UC benefits and correctly indicated that I did not receive (nor expected to receive) a severance package, as the negotiations with my employer were not going well at that point and he was threatening to pay me nothing. A few days later, cooler heads prevailed, and my employer and I reached an agreement in which I would be paid $X severance to be paid out on the last day of the year.

I was ultimately paid my severance on December 31st. However, I have submitted 3 bi-weekly claims (without indicating that I received the severance) on 12/16, 12/31, and 1/16. For those not aware, starting Jan 1st 2012, PA began deducting any severance pay received by a claimant that exceeds 40% of PA’s average annual wage (approximately $17,800). Since my package is above this amount, I’m afraid the benefits I have received up until this point will be considered an overpayment.

My question is what is my best course of action at this point? I figure I have two options: (1) Do nothing, wait for PA to catch the mistake, and then cooperate fully and pay back the money promptly; or (2) Try to self report that I received the severance now before the state catches the mistake (I have no idea how I would do this. I checked the PA unemployment benefits website for hours and there doesn’t appear to be a mechanism to self-report when you believe you are receiving overpayments).

I have to admit that Option 1 is appealing because it wouldn’t require any legwork on my part and it also provides the minuscule possibility that the mistake is never found and I actually get to keep the money (I know, I know never going to happen…but one can always hope). The downside to this approach is that I expose myself to the risk of a fault overpayment. While I understand that “failure to report wages and pensions may result in disqualification for benefits, fines, and/or imprisonment”, based on what I’ve read in this forum and others, the more likely outcome is that PA will send me a sternly-worded letter notifying me of the fault overpayment and give me X number of days to pay back the money (which I would do so immediately).

Could anyone with more experience with this situation correct me if I’m wrong in my assumption?

Also, do you believe I would be subject to interest or penalties if I cooperate fully and respond right away? In other words, (and this is directed to those that have received fault overpayment notices from PA), is it standard operating procedure for the state to initially offer you the opportunity to pay back the benefits without penalties or interest? I’m just trying to calculate whether it makes sense from a purely financial standpoint to wait for the state to catch the mistake on its own.

Thank you to everyone that takes the time to read about my situation. This board has been a great resource. Any advice would be greatly appreciated.
 


commentator

Senior Member
You need to reach someone in the unemployment system directly on the telephone. Right now. This week. It sounds as though you are receiving benefits now, as if you are filing for weekly benefits right now, are still in a claim, and are not yet reemployed. Is this correct? If so, act immediately! If this is not so, if you have returned to work, still act immediately!!!

Right now you likely have a non-fault overpayment, as you did not receive the severance immediately, and then were given it, did not answer a question on your certification correctly perhaps, but are now going to show up as a merely confused claimant. Since you received this money in one lump sum payment, you may only, at this point, be overpaid for one week, the week you actually did receive the severance payment. What they'd (probably)do is let you file for a week, and take this money from you to repay any overpayment due to your receiving the severance. If you fix it now, you may not have a "fault" or "Fraud" overpayment. It is sort of a judgment call on their part whether it is decided to be this kind of overpayment. One thing is sure, if you wait till they catch you, it will be.

The circumstance you describe is incredibly common, people don't know they're getting a severance, don't know how to report it properly when they do get it. They probably will cut you slack, give you the benefit of the doubt if you ACT NOW to contact them and let their claims center tell you what to do, and if necessary, take back a week or two of your unemployment to cover any overpayment. I can't say EXACTLY what they'll do, as I am not looking at your claim and do not work directly with their particular state. That's why you need to get hold of someone in their claims department and discuss this claim right away before you certify for another week...or before you let this lie around much longer claiming you just didn't know what to do, how to handle it.


HOWEVER, if you wait around, whether or not you are continuing to file weeks of benefits, you will inevitably and unmistakably be caught, do not doubt this at all. My guess is that you'd be caught as soon as this March or April, when wage reports are sent in. And it will be, because of your on-going failure to deal with the issue, your failure to try to make this right as soon as you realized your change in situation, you will end up with a fraud overpayment. This means you've committed fraud, obtained benefits by deception, all that stuff.

They will add on interest and penalties to the money you owe them. if you don't pay it all back right promptly, or work to set up an ongoing payment plan, for the amount they ask for, which could even be the entire amount you have received, not just the few weeks you did get overpaid for, they can garnish your wages if you're working. Jack with them a lot, and they could very well press charges against you.

I know many people on here come in scared witless about the prospect of going to jail over an unemployment overpayment, and I usually try to reassure them. They ARE going to be charged a lot of penalties, but dealing with it immediately is the way to go. You are right now in the position to do the right thing, which is report this money immediately and let them tell you how to deal with it, possibly avoiding all the penalties and fines involved. Then you won't have to worry about it. And it is likely going to be assessed from your unemployment claim that you're drawing now, probably without penalties. Which is a much more convenient way to deal with it if you are overpaid.
 
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commentator

Senior Member
Yes, you will need to self report. You don't need to say, "I have committed fraud and I want to turn myself in" What you do is explain the situation to them and ask them what you need to do to make this right, how to report the severance, how to keep making certifications. A very cursory glance at the website says that if you have a question about your claim, call center numbers are given for the different areas. I know it is hard to get them to answer a phone call, but you need to speak to a live human being. I cannot stress this enough. Begin calling at 7:00am Monday morning, and hold the phone as long as it takes to reach someone. DO NOT file another weekly certification until you have done this.

If you absolutely cannot reach anyone, try sending them a fax at (717)525-5160, and ask them to have someone call you about your claim. You do not have to tell them what you are asking about on the fax, just give them your name, ss# and a good number where you can be reached and request they call you.
 
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Ilovelamp

Junior Member
Hi Commentator,
Thank you for your response. I’ve read a lot of your prior posts and recognize that you are one of the most knowledgeable people on this board…I am very grateful that you responded to my post.

You are correct regarding my situation: I have been unemployed since Nov 30th. I filed 3 bi-weekly claims on 12/15, 12/31, and 1/15. I did not file a claim on 1/31 now that I’ve come to the realization that I shouldn’t be receiving these benefits. As you suggest, I will not file another claim until I speak with someone at the state.

Thank you for checking out the PA website. There are call centers available but it’s my understanding that it’s absolutely impossible to get someone on the phone. However, faxing them is great idea. I believe I read somewhere that the state will respond to a faxed question within 3 business days. Hopefully, that means I can get some clarity on my situation by the end of the week. I will let you know how things go. Thanks again for your help.
 

commentator

Senior Member
Seriously, try calling. No kidding, all the lines are busy most of the time, but hey, somebody is getting through, if they're all busy, right? So you try it, try to be the one. Call early. Most of these lines open up and begin to take calls early in the morning, like at 7:00am, and become more and more clogged throughout the day. Faxing and waiting isn't the most desirable situation. You want to get paid for all the weeks you may be eligible for, after they have recouped the overpayment there is no reason you can't keep filing for weeks as they pass. So get with them as soon as possible. Let us know how this works out for you. Good luck, hope you find someone good to speak with who will help you, there are good people in all these government programs, I know, I used to be one!
 

Ilovelamp

Junior Member
Hi Commentator,
Hope you are well. I wanted to give you an update. I spoke to someone in the unemployment office last Monday and described my situation to them exactly as we discussed.

The person basically asked me the same list of questions asked when I first applied for my benefits. Afterwards, she explained that the process would be to contact my employer to gather the same information and then another group within the unemployment office (I didn’t catch the name) would make a determination. She informed me that I should expect to hear back in 8-10 weeks.

However, yesterday I received a Notice of Determination in the mail. The document has three sections:
1. “Finding of Fact” - which indicates the last date of my employment, my severance amount, my annual wage, and that I filed an application for benefits on 12/15/2012 and 12/31/2012. Notably, it doesn’t include the benefits claim I submitted on 1/15/2013.
2. “Discussion”-which explains the Pennsylvannia UC Law as it related to severance pay and indicates what amount of my severance pay that is deductible.
3. “Determination”- Indicates that the claimant’s (me) severance pay is deductible and that the revised weekly benefit rate is $0 for the 12/15 and 12/31 periods.

The document provides instructions on how to appeal the ruling but provides no instructions on what to do if you agree with the ruling. Again, keep in mind that I already received these benefits on 12/15 and 12/31. This notice seems to determine that my benefit rate will be revised to $0 but doesn’t provide any instructions on how I can return the money.

What would you suggest I do?
 

commentator

Senior Member
Are you still unemployed? Are you drawing a claim right now, are you filing for weeks of benefits? If so, you need to keep doing this, and each week you'll be paid a check you won't be getting, as it will be going to the overpayment until the overpayment is covered. then you'll be back on your regular claim, receiving benefits again. That's what I'm assuming will happen if you're still drawing. It does not sound as if they have set up an overpayment just yet. It's possible that this letter you've received was issued before you spoke to the person last week, and that there is another issue out there.But I can't say, you really really need to ask them about this.

If you've gone back to work, you'll need to talk to them again at the number that is on this determination to set up a payment schedule to discuss paying the overpyment (when it is set up.) I told you that they would at sometime see that you had received the severance, and that it would be ajudicated later, even if you didn't mention it or didn't file for any more unemployment.

But without understanding exactly what your situation is right now, I can't say much about
 
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Ilovelamp

Junior Member
Hi Commentator,
Yes, I am still unemployed. I haven’t submitted a claim since 1/15, as you advised me to do in your prior response (see thread above). Are you now advising me to start submitting claims again? I’m not sure I understand your instructions.

Also, based on how I read your response, it appears there is no required action I need to take now that I’ve received the Notice of Determination…I should just wait to hear from the state regarding setting up the overpayment schedule. Based on my read of the Notice, it only provides instructions for those that intend to appeal the decision (which I don’t plan to do). So I don’t believe any action is required either but I just want to make sure I understand you correctly.

Thanks again for all your help.
 

commentator

Senior Member
I have always been a bit confused on whether or not you had gone back to work somewhere or were still unemployed. Now that I know for sure, the answer is yes, by all means, why would you not continue to file for unemployment insurance claims for each week you are unemployed? They'll get the ones they want to cover this two weeks overpayment, they won't actually be sent to you once you've filed for them, and then you get the rest of them after certifying for the week.

Each week you are out of work is a separate entity, you are not precluded from filing anymore by the fact that you filed in error for two weeks back in January. Make sure you are making your appropriate job searches, and you are fully entitled to these future weeks.

Since it has been so long, you probably won't be able to go back and certify for those previous weeks in the system, they'll probably want you to reopen your claim before you can certify any more, but take action now!! Call them if you can't start certifying, and start certifying again at once! In fact, try to certify for each week since January, the week of the 19th, the 26th, the 2nd of Feb, the 9th, and the 16th are all weeks you could have filed for and should have filed for.

If they won't let you, because it has been too long since your last certification, even so, re open the claim, and begin making certifications starting right now for weeks that pass. (All unemployment weeks run from Sunday to Saturday, regardless of when you certify for them, so when you are discussing this situation with them, you were filing for the previous weeks when you filed for the weeks of the 5th and 12th of January on January 15th.) I believe I recall that you certify for two weeks at a time in Pennsylvania. It doesn't matter when you certify, it's always that you are certifying for previous weeks when you were unemployed and made your job searches, and thus were legitimately eligible for unemployment benefits.) You got overpaid for the first two weeks, and as I said, they'll take those two checks back, but from then on, you will keep certifying and getting benefits until you find another job or run out of benefits.
 
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