JEFFERSON CITY, Mo. – The Department of Labor is pausing all collections on overpayments of unemployment benefits while lawmakers work to pass legislation to waive the federal portion.
House members repeatedly asked the department Tuesday during a House committee hearing why Missourians who were overpaid unemployment benefits continue to receive letters after they were under the impression collections were paused.
Representatives said Director of the Department of Labor Anna Hui promised to pause all overpayments last month once the House passed House Bill 1083. Hui responded Tuesday by saying it was a miscommunication.
That legislation, sponsored by Rep. J. Eggleston (R-Mayville) would waive the overpayments of federal dollars, which make up 75% of overpayments.
“We were under the impression that you wouldn’t be sending anymore [letters] until at least the end of session,” Eggleston said. “We kind of felt like you were going to stop the garnishments and liens as well.”
Members on the committee said they’ve been contacted by multiple constituents about letters they continue to receive saying they have a lien on their house, or their wages are being garnished.
“Why are constituents still receiving these letters specifically when they have reached out to the department, they have attempted to contact the department,” Rep. Jered Taylor (R-Republic) said.
According to the Department of Labor, 46,000 Missourians have overpaid their unemployment benefits. Hui said the average Missourian owes $4,000.
“We have an obligation under state statute to collect that state portion, but we will pause everything right now,” Hui said.”
As of last week, we have 1,800 appeals made by claimants contesting an overpayment notification.”
When the House approved HB 1083 in March, Eggleston spoke on the House floor informing other members the emergency clause, puts measures into effect as soon as the governor signs the bill into law, was not needed.
Eggleston said because the department was pausing collections, it wasn’t needed immediately since it would take some time to put the paperwork together.
Hui said the conversation she had with House members was for the federal portion, not for the state part.
“Negotiation for the removal of the emergency clause, we were asked to specifically pause the collections of non-fraud, federally unemployment overpayments,” Hui said.
“Why wasn’t this done, why are we having to bring this to the department’s attention when it was our understanding that this should have been happening since we made that agreement with the department in the Speaker’s office,” Taylor responded.
Committee members said they now have “trust issues” with the department.
“It’s really hard to say you have this wonderful kumbaya situation with the department of labor and they are working with everybody when they’re not,” Rep. Scott Cupps (R-Shell Knob) said. “I think the department is good on their word and now we are sitting here today, and I just feel a little bit stupid if I’m being honest.”
According to the Hui, the Department of Labor paid out more than $5 billion in unemployment benefits in 2020, compared to 2019, when the state only paid $236 million.
Hui said the department paused all letters being sent for overpayments last week and as of Thursday, was pausing collections online.
“That’s also one reason why we are pausing everything related to collections itself,” Hui said. “It gives us the opportunity to vet out those other circumstances.”
When testifying in front of the committee Tuesday, Hui said there were 32 cases that resulted in liens with the court due to a large number of appeals.
By the end of the committee, she told members all cases were removed from the court.
“We have to go back home and face these people and something like this can cause major financial havoc in a family home,” Rep. Dottie Bailey (R-Eureka).
Hui said there is no date on when collections would resume.
If the General Assembly passes HB 1083, Hui said any overpayments they collected of the federal portion would be returned to Missourians.