N.J. residents (as many as 250,000) will not have to pay back extra unemployment benefits

USDOL, after urging from N.J. officials, said those who received extra UI benefits through no fault of their own can keep estimated extra $4,400

As many as a quarter of a million New Jersey residents will not have to pay back the U.S. Department of Labor for extra unemployment benefits they received through no fault of their own, the USDOL announced Tuesday.

The USDOL revised earlier guidance on states’ ability to waive certain unemployment insurance overpayments after New Jersey and other states urged the action on behalf of claimants who received federal benefits during the pandemic but were later found to be ineligible.

Robert Asaro-Angelo, the commissioner of the state’s Department of Labor & Workforce Development, applauded the decision.

“This is great news for tens of thousands of New Jerseyans who received these benefits believing they were entitled to them, but found out when federal guidance changed that they did not meet the eligibility standards,” he said. “We’re grateful to U.S. Labor Commissioner (Marty) Walsh for his openness to state input, and the dedicated staff at USDOL for their efforts on this important change.”

In New Jersey, as many as 250,000 claimants could be affected. The average overpayment is about $4,400.

The updated guidance contains five scenarios under which overpayments may be waived, all involving receipt of COVID-19-related expanded unemployment benefits such as Pandemic Unemployment Assistance and Pandemic Emergency Unemployment Compensation.

The situations include but are not limited to: if a claimant responded “no” to being able and available for work and the state issued PUA or PEUC payments without adjudicating the eligibility issue; a claimant who received a higher PUA payment than they were eligible for; a claimant whose PUA weekly benefit amount was calculated incorrectly based on the earnings statement submitted.

Walsh said the New Jersey DOL was instrumental in the push for a change.

“We are thankful to the states, like New Jersey, that shared with us challenges dealing with overpayment waivers in a way that will not alarm claimants or cause them undue hardship,” he said. “States did their best to pay benefits as quickly as they could during the pandemic, but implementing new programs quickly meant innocent mistakes that resulted in overpayments. We encourage states to forgive as many honest mistakes as they can.”

NJDOL officials said they are working through the details of the updated guidance and will notify claimants eligible for the overpayment waivers of their next steps.