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Gov. Brown's staff orders EDD to fix unemployment insurance problems

Unemployment and LayoffsJobs and WorkplaceUnemployment BenefitsInsuranceAccounting and AuditingHenry T. Perea

Citing "unacceptable levels of of payment delays and unanswered calls," Gov. Jerry Brown's administration has ordered the Employment Development Department to hire additional staff, overhaul its phone system and add IT staff to fix problems with its unemployment insurance program. 

In a letter to the EDD's chief deputy director Sharon Hilliard, Labor Secretary David Lanier said that despite the EDD's best efforts, technical problems with a recent computer upgrade and a federal funding shortfall has hindered the agency's ability to deliver adequate services to the state's unemployed.

In a seven-point plan, Lanier ordered the EDD to hire 280 unemployment insurance staff, retain additional interim staff, continue paying overtime pay and implement a "virtual hold" system on its phones. 

He also directed the EDD to hire programming staff to fix the state's bungled $110-million unemployment insurance upgrade. 

“The administration is committed to providing the funding necessary to improve service levels in the UI program,” Lanier wrote to Hilliard. Addressing the problem can’t wait for completion of the state budget process in June, he said. 

Since late August, when an upgrade to the unemployment insurance program malfunctioned, the EDD has delayed benefit payments to about 150,000 Californians. Affected residents have fallen behind on bills and struggled to make ends meet. 

Call volumes to the EDD soared after the upgrade, with frustrated Californians demanding answers. The department has also struggled to keep up with the deluge of phone calls. A recent Los Angeles Times article found that after the upgrade, the EDD answered far less than 20% of an estimated 3.9 million calls placed in a week. 

Lanier's orders follows a call by a lawmaker who last month requested $12 million from the state's general fund to add additional staff to answer phones at the EDD.

Assemblyman Henry T. Perea (D-Fresno) has also requested an audit of the EDD's appeals process by the state's Joint Legislative Audit Committee. The lawmaker has been critical of the high rate -- more than 50% -- at which denied unemployment benefits claims are reversed during the appeals process.

"Clearly the system is still broken when claimants have to call EDD on average 40 times to get through, and when over 50% of [unemployment insurance] denied claims that are appealed are overturned," Perea said. "My plan lays out a set of reasonable proposals to improve the [unemployment insurance] program, and give claimants better service." 

An email seeking comment from an EDD spokeswoman was not immediately returned Friday.

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