October 21, 2020

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Texas unemployment overpayments during COVID-19

3 min read



Since Texas shut down in mid-March, approximately 3 million Texans have filed for unemployment and the state has distributed $19 billion in unemployment benefits.

Unfortunately, it has been reported that the Texas Workforce Commission (TWC) has overpaid approximately $32 million and has sent out more than 46,000 notices to claimants.

Reasons for Overpayments

TWC says the most common reasons for the overpayments were that the payments were too high or workers were not eligible. On the TWC site, they list a number of ways that overpayments can happen, including but not limited to:

  • Not reporting earnings or reporting incorrect earnings when requesting benefit payments;
  • Correction of wage errors resulting in a lower benefit amount than initially determined because the wage history used to establish a claim included errors or belonged to another individual;
  • Providing incorrect or false information about your job;
  • Having an appeals ruling reverse your eligibility after TWC paid you benefits; and
  • Committing fraud.

What Should You Do If You Receive an Overpayment Notice?

Many of the people who received alleged overpayments dispute that they are responsible for the errors. They feel that they applied for benefits in good faith and that even if there were an error, unfortunately, those overpayments have already been spent. Thankfully, on the one hand, TWC has confirmed that they will not deduct overpayments from future benefits during the pandemic so you can count on continuing to receive assistance during these difficult times. Unfortunately, on the other hand, TWC is not allowed by law to forgive or dismiss overpayments and there is no exception for hardship. There is also no statute of limitations on unemployment overpayment cases.

While receiving one of these notices can be alarming, there are a few things you can do:

  • You can request a waiver from repaying federal benefits provided under the CARES Act.
  • For the amount overpaid from state benefits, if you feel that you have not committed any error, experts say the best thing to do is to file an appeal.

While TWC claims that their rate of error is very low, often citing that last year, they were found to be responsible in 0.4% of incorrect payment cases, it is indisputable that they are experiencing an unprecedented volume in claims. By early July, they reported that nearly 650,000 applicants were still waiting for their unemployment benefits applications to be processed. Because of the influx of claims, it may turn out that more errors were made by TWC during the epidemic than during a normal time period.

If it turns out that TWC was responsible for the error leading to overpayment, then you will NOT have to repay the overpayment. (This was previously misrepresented in articles about overemployment overpayment but was confirmed a few days later by Cisco Gamez, a spokesperson for TWC.) If it is determined that you or your employer committed an innocent error, you will have to repay but there is no penalty or interest and you can set up a payment plan to make it easier to repay. Finally, any finding of fraud will incur a 15% penalty.

About the Author

Graham Sutliff is the co-founder of Sutliff & Stout, Injury & Accident Law Firm.  Graham is Board Certified in Personal Injury Trial Law, and he has been actively trying personal injury cases for over fifteen years.

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Texas unemployment overpayments during COVID-19



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