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ESC cuts jobless benefits to recoup overpayments

Posted September 29, 2010

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— The state Employment Security Commission is withholding $28 million from the unemployment benefits being paid to thousands of people, saying the agency mistakenly overpaid them in recent months.

David Clegg, deputy chairman of the ESC, said Wednesday that a computer programming error led to the problem for people receiving a second year of benefits. It's unclear how long the problem existed, but the discrepancies were caught early this year by an internal audit, officials said, and the agency had to address the issue while the people affected were still receiving benefits.

"What we are trying to do is deal with the issue," Clegg said. "We are obviously sorry it happened, and (we want to) deal with the issue and deal with it individually and as quickly as possible."

Letters have been mailed to about 38,000 people to explain how much they might owe, but the ESC hasn't been able to determine how many people owe money and how much the state might owe others.

Clegg said many of the people receiving letters will end up owing nothing, and about 15 percent were underpaid and will be eligible to receive more money.

People are receiving as many as six of the letters, which inform recipients that money could be withheld from their current benefits but don't indicate when they could begin seeing lower payments.

Lawmakers, unemployed want answers in jobless benefits error Lawmakers, unemployed want answers in jobless benefits error

Durham resident Trumiller Nesbit said she was stunned when the ESC began cutting the amount in her weekly benefit checks after notifying her that she owed the state money.

"For it to come out of the blue – they took half my check – you can't plan for that," said Nesbit, who was laid off last year and is taking online classes to upgrade her skills while she looks for work.

"It's been very stressful. It's hard to do any studying," she said.

"What a huge screw-up by people who have jobs," Senate President Pro Tempore Marc Basnight said. "(This is) horrendous, to say the least, for people who are out of work and looking for work."

Basnight, D-Dare, questioned how the ESC could know the amount of overpayments but have no idea how much the state owes people who were underpaid. He called the series of letters to unemployed people "pure mismanagement" and said someone at the ESC needs to be held responsible for the mistake.

Gov. Beverly Perdue has asked for a better explanation of the situation, according to her spokeswoman, Chrissy Pearson.

"She wants to get to the bottom of this and fix it as soon as possible," Pearson said.

Clegg said the ESC is investigating to determine the source of the error that led to the overpayments. The technicalities of unemployment extensions granted by Congress and the heavy volume of people in the system contributed to the problem, he said.

Still, he defended the way the agency has handled the situation.

"I think that, based on our operating procedures, it was appropriate," he said. "Every one of those claims has got to be looked at individually, and that's what we are doing."

If people wind up owing the state money, Clegg said they can apply for a waiver. Waiver requests are due by Oct. 8, and the ESC will review them individually to determine if any accounting error has been made, he said. People can apply for the waiver at any unemployment office or send an e-mail requesting a waiver.

If the ESC denies a waiver, the affected person can appeal the decision like any other unemployment case, ESC spokesman Larry Parker said.

The ESC plans to keep its phone lines open until 8 p.m. each night this week to answer questions about the letters. Officials suggested that people e-mail the agency at esc.ui.customerservice@ncesc.gov since phone lines have been overloaded in recent days.


This story is closed for comments.

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  • hermit13 Oct 1, 2010

    So,, now that they say we wont have to pay back the money do we get it back? Now that the bills are gonna be late do we send the state the bill for that?

  • Ladybug Sep 30, 2010

    I feel that the Director of the ESC has made some big mistakes and should be fired. We have got to make people in our State Gov't accountable for mistakes as big as this! Gov. Purdue, do your job nand clean up the ESC.

  • csmac99 Sep 30, 2010

    My wife received six confusing letters last weekend saying she had through 10/8 to appeal the process. She filed online Monday morning as usual - no direct deposit made by NC a few days later. She checked the ESC site today and was listed as having exhausted her benefits - much, much earlier than an earlier letter in August led her to believe. Nice appeals process.....

  • marmedmil Sep 30, 2010

    Robert Cottrell, the Director of Information Services for the ESC makes $143,407.00 per year. Why? If you believe Mr Clegg, Deputy Chairman of the ESC who makes $135,000.00 per year, this fiasco is due to the computer system. Well, evidently Mr Cottrell is not doing his job either. I think a severe house cleaning is in order. Who exactly is the boss over everyone at the ESC? Maybe we need to team up and send that person all of our complaints and demand that these people take responsibility for what's happened and hire new people that will get the job done. Because, these people surely aren't.

  • wtfisup20 Sep 30, 2010

    To All Who Got Letters From ESC about paying back unemployment, check this out: Lynn R. Holmes (Chairman) makes $120,363; David Clegg (Deputy Chairman) makes $135,000; David Canady (Director of Unemployment Insurance) makes $106,787; and Robert Cottrell (Director of Information Services) makes $143,407.

    Governor Perdue, ESC would be a good place to start in fixing the budget issue and repaying those unemployment overpayments with all of those salaries being paid over there.

    Maybe all of those people needs to be unemployed, and worried where they're going to get money to pay the bills and feed their families. Make all of those with high salaries at ESC pay for their mistake and leave us unemployed folks alone!!!

  • Justin T. Sep 30, 2010

    "People that have their 8 hour job have no concept what its like to be laid-off and never to be called back. Maybe they do need to be laid-off so they will know how it feels. That will certainly change their way of thinking for sure."

    I've been laid off before, you've been laid off, half of my family has been laid off at one point or another. Just about everybody knows how you "feel" but most productive members of society man up and get it done. Whining and pretending you're all alone in your struggle won't get you a job, I guarantee you that.

  • we_all_have_it_coming Sep 30, 2010

    "People that have their 8 hour job have no concept what its like to be laid-off and never to be called back. Maybe they do need to be laid-off so they will know how it feels. That will certainly change their way of thinking for sure."

    Not so. Many of us with current jobs have been laid off in the past.. some of us more than once.

    Know what? You get your rear end up off the ground, you make changes in your life and you start again if needed. Life changes for all of us - even the ones working at something we don't like just to pay the bills.

    Being employed does not mean you are happy or successful.... or that you can pay the bills.

  • HadEnough Sep 30, 2010

    Attention ESC management!
    The bus is leaving, get on it!

  • weasel2 Sep 30, 2010

    Find the mistakes and make reasonable accomodations and recoup the money.

  • marmedmil Sep 30, 2010

    @T-3485, if you are and ESC employee, now is not the time to be bragging about it. If you consider all the hardship being put on these families right now making light of this situation is in very poor taste. The people I know strive to do the best job they can, not just get by with what they can at the expense of others. It will catch up with you.