Unemployment Compensation Audit Shows Systemic Problems

“​We’d like to thank the Auditor General for his diligent and rapid audit of the prior four years’ worth of Department of Labor & Industry expenditures. His report shows conclusively that the furlough of nearly 500 public employees brought the state Unemployment Compensation system to its knees. While in November State Senator Scott Wagner claimed responsibility for the furloughs in the name of accountability, the audit shows his actions have initiated what could be a catastrophic chain reaction of events for the Unemployment Compensation system: if a multi-year funding bill is not put in place immediately, additional centers could close, and benefit delays could skyrocket,” said Tom Herman, President of SEIU Local 668.

Auditor General Eugene DePasquale released the completed Labor & Industry audit that looked at spending over the past 4 years of SIIF expenditures. However, as the Auditor General pointed out “This audit is about more than finding out what happened to the money and how much additional funding is needed to fix the problem,” DePasquale continued. “It is about providing the people of Pennsylvania with the level of service they deserve. It’s about the 312,000 Pennsylvanians who tried to call the UC service centers in January and got a busy signal 99.3 percent of the time. The Department of Labor & Industry must do better.”

In response to the press conference, SEIU 668 President Tom Herman agreed that the state needs to do better and that includes bringing back all furloughed members to provide the services needed for the underemployed and unemployed workers, and employers. “There is direct evidence that the furloughing of nearly 500 UC workers 6 days before Christmas last year brought the system to its knees. Even now with the recall of 200 workers, the system will still remain broken.”

Also in attendance was State Senator Scott Wagner of the Senate Labor & Industry Committee.  In remarks following the Auditor General’s statement, Senator Wagner said he thought the computer system should be outsourced to professionals.

In response to Senator Wagner’s comment, President Herman said, “We have seen first-hand what the taxpayers of Pennsylvania have gotten for their tens of millions of dollars from third party IT vendors. But beyond the potential failure of the outdated IT system to work with needed automation improvements, it is the people that are needed to make sure the unemployed and underemployed workers are receiving the benefits to which they are entitled. For Senator Wagner to make reference to such as an option is a misguided statement and it infers a lack of knowledge.” Under Federal law, U. S. Department of Labor prohibits the outsourcing of personnel who determine eligibility for unemployment compensation benefits.

“Now that the Auditor General has completed an audit of the system, the General Assembly has no more excuses to address the need to immediately move legislation that will end this crisis in our call centers and allow all furloughed workers to return to serving the public. It is critical that a permanent long-term funding solution is in place and not be a political pawn in the lawmaker’s constitutional duty to pass a budget. We cannot let lawmakers leave Harrisburg for a three-month summer vacation without finishing the task of fixing the Unemployment Compensation funding crisis.” said Herman.

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