Labor & Industry offering amnesty for unemployment funds

David Weissman
York Dispatch
County residents needing to file for unemployment compensation are facing a long wait at CareerLink, Monday, Jan. 9, 2017. John A. Pavoncello photo

The state Department of Labor and Industry is in the midst of an amnesty program in an effort to collect more than $650 million owed to the unemployment compensation fund.

The program, which began July 1 and runs through Sept. 30, offers a discounted rate to claimants and employers who owe the department money.

The department has sent letters to claimants who have received more unemployment compensation than they deserved and employers who have unpaid contributions or reimbursements.

The longer a claimant or employer waits to pay the department, the more interest they owe.

For claimants who received overpayments through no fault of their own on or before Dec. 31, 2016, they must pay back half of the overpayment, while the department will waive the other half.

Claimants who are at fault for receiving overpayments on or before Dec. 31, 2016, must pay the full overpayment balance, lien costs, 15 percent penalty and half of the interest owed. The department will waive the other half of the interest owed.

Employers who have unpaid contributions through the third quarter of 2016 or unpaid reimbursements due on or before Oct. 31, 2016, must pay all contributions or reimbursements, lien costs and half of the interest and penalties owed. The department will waive the other half of the interest and penalties owed.

More:State suing IBM over unemployment compensation tech

York County is home to 3,869 claimants and 566 employers eligible for the amnesty program, according to the department. Both amounts are among the top-10 highest in the state.

Eligible participants can submit payments online through or call dedicated phone lines at 855-284-8545 for claimants and 866-403-6163 for employers.

Robert O'Brien, executive deputy secretary for the department, said the department has received about $700,000 in the first couple of weeks of the program. They netted about $15 million the first time they offered the amnesty program in 2013, he added.

The $651 million owed to the department would go directly into the unemployment compensation trust fund, which is used to pay residents eligible for unemployment compensation.

Issues: Any interest collected would go toward the department's operating costs for the unemployment compensation system, which has been in flux during the past year.

The department furloughed nearly 500 employees and closed three service centers in December after the Republican-controlled Senate refused to vote on a bill that would have provided $57.5 million in additional funding for those operations.

Sen. Scott Wagner, R-Spring Garden Township, said that he had led the charge against holding a vote on the bill because of a lack of accountability by the department for the money already allocated to it.

More:Audit shows poor oversight in Labor & Industry

The Legislature had allocated about $178 million in additional funding from 2013 to 2016 for the unemployment compensation system, and nearly $170 million was spent before then to modernize the department's technology, which remains outdated.

A report by the Auditor General's Office detailed that it could not account for how that $178 million was spent because the department did not separate it from its other funds.

The audit also found that nearly 100 percent of callers to the unemployment compensation centers were receiving busy signals for an average of two hours following the furloughs.

The Legislature passed a bill in April allocating $15 million to the department, which promptly brought back less than half of the furloughed workers.

O'Brien said the return of staff has helped reduce the number of callers receiving busy signals, but the system is still "wounded" and "not up to the level of service the people of Pennsylvania deserve."

The issues led Wagner to call for the termination of Labor Secretary Kathy Manderino, and she will be leaving the department Aug. 1, but only because she is joining the state's Gaming Control Board.

Wolf has named O'Brien to serve as acting director once Manderino leaves.

O'Brien said he has worked for the department from 2003 to 2011, returning in 2015, and he is honored by the promotion.

— Reach David Weissman at or on Twitter at @DispatchDavid.