Massachusetts Unemployment Overpayment Notices

Many people have been receiving notices from the Department of Unemployment Assistance ("DUA") claiming that they were mistakenly paid, or overpaid, regular or pandemic unemployment benefits.  In part because of the additional funds made available during the early part of the pandemic, the amounts of these claimed overpayments can be staggering- sometimes $40,000 or more.  It is important for you to know that you have appeal rights and the right to request a waiver of the overpayment.

Unemployment Overpayment and the Pandemic- Background

In early 2020, the federal CARES Act added significant benefits to the unemployment system, including additional weekly benefits and establishment of pandemic unemployment benefits to allow the self-employed and independent contractors to access benefits during the pandemic.

In part due to the high volume of people applying for unemployment in the first two quarters of 2020, and in part due to the fact that pandemic unemployment was entirely new , there were often delays, and a lot of confusion, in processing claims.  Finally, the federal unemployment funds came with a catch: states are required to try to recoup any amounts paid in error during the pandemic.

The result?  Many people who collected unemployment benefits in 2020 and 2021 are being hit with "overpayment" notices, claiming that they should not have received those benefits and have to pay them back.  This can be as much as $30,000 or $40,000 in claimed overpayment. 

Understand Your Appeal and Waiver Rights

The notice should contain information about your appeal rights and your right to request a waiver of the claimed debt.  These are two different things and it is important you understand them both.

Your right to appeal is your right to challenge the decision that you should not have received benefits.  If you are successful in overturning this determination, there is no debt to forgive or waive.

The request for waiver is a request for the state to use its discretion to forgive, or waive, the claimed debt.  This may happen if you were not at fault for the mistake and if enforcing the debt would cause a hardship.  A waiver request does not operate as an appeal.

We have had clients who filed for a waiver and believed that was the same as appealing the decision.  This caused the appeal deadline to come and go, potentially precluding them from challenging the decision in the first place.

The other reason it is so important to request an appeal immediately is that these overpayment determinations are frequently wrong, resulting from the state's own confusion about how to implement pandemic unemployment in the first case, or mistakes caused by an overwhelmed unemployment system in the early months of the pandemic.  If you timely appeal, you have a good chance of eliminating the overpayment entirely.

How is the overpayment enforced?

A private creditor has to go through a process of obtaining a judgment and going through certain post-judgment process to collect a debt from you.  The state, however, has self-help remedies available.  It can count the overpayment against any future application for unemployment benefits.  It also can intercept your state tax refund if unpaid.

If you receive a tax intercept letter stating that your refund will be intercepted, you can have that lifted by proving that the underlying determination is under appeal.

Need Help With an Unemployment Decision?

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Do You Need a Lawyer for Your Overpayment Notice?

This depends on where you are in the process.  Like regular unemployment, there are things
most people can handle themselves with the right information and guidance.  For these parts, it just may not make economic sense to hire an attorney.

There are other parts of the process, however, where having a representative significantly increases your chances of overturning an overpayment notice.

That's why we have created the Unemployment Roadmap- a low-cost, step by step "how to" guide through the process.  You can use this to guide you all the way through, or use it to get it as far as you can go and give us a call when you are ready for help.

If you have an appeal hearing scheduled already, or have received a denial after a hearing, this would be a good time to get a lawyer involved.  If you are earlier in the process, however, the Roadmap may be your perfect solution.

Check Out the Roadmap

What if I don't have the money to pay the overpayment?

The most cruel aspect of the current wave of overpayment notices is that most people who collected benefits used them for exactly what they were meant for- staying afloat financially during the pandemic.  That means chances are when you get a letter saying you have to pay back twenty, thirty or forty thousand dollars, you have already spent those dollars on your basic living expenses.

The first thing to do, as described above, is to take advantage of the appeals process and the waiver process.  There is a good chance you can address the claimed debt that way.  You should also know, however, that even if your efforts to overturn or waive the overpayment are not successful, you may be able to discharge that debt through bankruptcy.  Though we do not do bankruptcy law at slnlaw, we have several highly qualified, compassionate bankruptcy attorneys who we refer people to if they find themselves in a situation where they need to make that choice.

How We Can Help

If you have received an overpayment notice, we can help. You can use the button below to schedule a call back from a member of our team, give us a call at  781-784-2322, or use the button below to schedule a free information call.

Schedule a Free Information Call