If you receive a Notice of Determination finding an overpayment, you can appeal this determination within 15 days from the date the determination is mailed. Point blank, if you are at this stage it is crucial you appeal promptly and contact an experienced unemployment lawyer. Unemployment fraud is a serious offence that can even result in imprisonment.
When you apply for unemployment benefits, the application represents a legally binding document. At any time within the statute of limitations, the Unemployment Compensation Service Center may mail you a letter regarding non-fault or fault overpayment. If you’ve received a letter from a PA UC Service Center informing about an overpayment, you may be wondering what you have to do. Do you have to pay this amount back? What if you don’t pay it back or can’t pay it back? Can they take you to court to collect it? Can they place a lien on your house? What if it was a mistake?
Let’s start at the beginning, what is the definition of fault?
There is no statutory definition of “fault.” However, the courts have consistently interpreted it to be conduct designed to improperly and intentionally mislead the unemployment authorities is sufficient to establish fault. Think back, did you make any statements on the unemployment application, the interview with the unemployment representative, or during the unemployment appeal hearing which could be construed as misleading or a falsehood? It’s also very common that people engage in gainful employment while collecting unemployment and fail to report it.
How did they find out you are in overpayment? They have a team put together to investigate fraud and waste. They often compare public records, tax records, statements from the employer, statements from individuals, and compare that to anything you have said or done with applying for or receiving unemployment benefits.
Am I fault or non-fault and what are the penalties?
The key to what your rights, duties, and obligations are depend on whether the UC overpayment is considered fault or non-fault. What will usually occur is that you receive a letter from the Service Center stating that you were a recipient of an overpayment and the Unemployment Compensation Service Center will ask that you repay this amount. This letter will likely state whether or not the payment is considered fault or non-fault. Non-fault overpayments typically occur when you receive benefits initially and the employer wins following an appeal or when an employee mistakenly receives benefits and has not misrepresented or concealed material facts. When an non-fault overpayment occurs and you don’t return the benefits you received, the overpayment will be deducted your future PA UC benefits. Additionally, the deduction cannot exceed 33% of your weekly benefits.
On the other hand, if the overpayment is considered a fault overpayment, you will have to repay the benefits received. If you do not pay the amount of the overpayment in full within 15 days, interest on the overpayment will begin to accrue. A lien can also be filed against you for the overpayment and the overpayment can also be deducted from future benefits. In addition to obligation to repay with penalty, the PA UC Service Center can seek criminal penalties and jail time of up to 30 days for each check obtained if the receipt of UC benefits is considered fraudulent.
You only get a criminal record if you end up getting convicted. The decision to prosecute is at the sole discretion of the director of the unemployment agency. However, if the money is returned, the State has much less ground to pursue a claim. If you have more questions on the penalty for overpayment and unemployment fraud, consult our unemployment lawyers immediately.
Can I self-disclose unemployment fraud?
Yes. The chances of no prosecution or prosecution with a more lenient result are far greater if a person self-reports and has the money to pay back on-the-spot or through a repayment plan. It is best to have an unemployment attorney to help handle the self-reporting to make sure that there are no misrepresentations when you file — such as, your disclosure being construed as confession to fraud.
What is the most common question?
“I got a letter saying that I received an overpayment in the amount $3,000. I worked briefly and didn’t report it to unemployment. They are currently demanding repayment. What happens next am I going to jail? Do I have penalty weeks? Do I have to pay a fine? Can I just ignore them?”
If this has occurred you should consult with an unemployment lawyer so that they can make a judgement call on the nature of the overpayment. The more severe the offense the more penalties and fines will be attached. The absolute, hands down, worst possible thing to do is ignore the Notice of Determination. If you let the 15 day appeal window lapse you will have basically consented to the UC Service Center’s determination. Your only remedy would be to seek review in a Pennsylvania Commonwealth Court. Assuming you have not let this period lapse, if the unemployment lawyer determines you should appeal then you will proceed to an unemployment appeal hearing. Because of the low odds of overturning an unemployment appeal hearing, this substantively your last chance. From this unemployment hearing you may now be stuck with major penalties as well as a record that the UC Service Center may use to seek criminal penalties. Although this is a different hearing than one seeking unemployment benefits, the main concern is the same: What if you didn’t have a lawyer at your unemployment compensation hearing?
Should you contact an unemployment attorney?
If you are experiencing any of the issues we have discussed, you are best advised to seek unemployment legal counsel. If you have any questions please call or e-mail our unemployment lawyers immediately. The best advice we can offer is that you head off unemployment problems before the decision becomes final. That will mean an investment in an unemployment lawyer that will substantially pay off to avoid the substantial civil and criminal penalties that are possible.