Maryland is slowly digging out of a backlog of unemployment claims even as state labor officials say they are wrangling information to comply with a federal subpoena.
Labor Secretary Tiffany Robinson told a panel of lawmakers Wednesday that her agency has paid on more than 405,000 claims and has whittled the number of pending applications to about 34,000.
“We hope to continue on the trend of reducing those numbers,” Robinson told the General Assembly’s Joint COVID-19 Work Group Wednesday.
In just over three months since the COVID-19 pandemic reached Maryland, nearly 800,000 residents filed for unemployment, with additional claims expected on Thursday when the U.S. Department of Labor releases its updated weekly report.
Large numbers of first-time claims, about 42,000 for the week ending June 13, continue to roll in despite Maryland employers adding nearly 30,000 jobs in the month of May as the state gradually eases restrictions and some laid-off workers return to their jobs.
The large number of weekly filings are unprecedented. Robinson said during The Great Recession, the department fielded an average of 6,000 claims per week with the claims topping out at over 12,000 per week at times.
Robinson said the number of pending claims is equal to about 6.5% of those filed.
“Six percent of claims pending is not an unusual amount of claims pending in normal times,” said Robinson. “It’s a higher number because, obviously, our volume is higher.”
The large number of claims, changes in federal law meant to provide more assistance to workers, and the rollout of a troubled website all combined to hinder paying out some claims, Robinson said.
Her assurances didn’t satisfy the House’s top legislative leader.
“Though we have seen some progress, we continue to hear about problems with the unemployment insurance process,” said House Speaker Adrienne Jones. “People are hurting and we need this to be resolved quickly.”
Two weeks ago, Jones said, lawmakers were told that the Department of Labor was only processing claims through May 9. A number of lawmakers report fielding complaints daily and Robinson said she was setting up weekly calls to keep legislative staff up to date.
“My team is truly working around the clock to move mountains,” said Robinson, adding that the agency has less than 1% of claim volume that remains from March or April.
“These remaining claims … all fall into complex categories having one or more issues related to potential fraud, Social Security verification, alien verification,” said Robinson. Some applicants, she said, may be receiving pension or severance pay that could affect benefits.
The state has also cleared some of the backlog by shifting some claims into a recently created federal program for pandemic assistance. Last week, the state reported reclassifying 43,797 claims under a federal program meant to extend benefits beyond the traditional 26 weeks.
Some lawmakers are pushing for the state to find alternate ways to get cash to struggling residents even as their unemployment claims are pending.
Del. Vaughn Stewart, D-Montgomery, has started an online petition calling on Gov. Larry Hogan and the Department of Labor to cut initial $1,200 checks to those making claims “and worry about bureaucratic box-checking later.”
Del. Eric Luedtke, D-Montgomery, said some other states that have been inundated with claims have started sending checks and “clawing back the money later” if the person is found to be ineligible.
Robinson said such efforts in other states have led to fraud.
“Many of the states that have entered into that type of practice, paying immediately upon the filing of a claim, are the states such as Washington state, Rhode Island … that did that immediately and did it with hundreds of millions of dollars paid out in fraudulent claims,” said Robinson. “We have been encouraged not to do that by our federal partners.”
Over the weekend, Maryland and other state labor departments received subpoenas from the U.S. Department of Labor’s Office of the Inspector General seeking detailed information from claims made in each state. The inspector general’s office is expected to cross-reference the data looking for more fraudulent claims.
“We are happy about the fact that we have not been targeted, that we are aware of as of yet — as some other states have been in terms of fraudulent claims — groups of fraudulent claims,” said Robinson. “We’re obviously determined to get all eligible claimants paid if they are eligible, but the pressure from the federal government to maintain program integrity is real.”