One of the worst parts about receiving unemployment benefits is receiving a notice that you now have an overpayment. In this post, I’ll explain the three types of unemployment overpayments in Oklahoma and the steps you need to take if you want to appeal.
3 Types of Overpayments
Oklahoma divides unemployment overpayments into three types depending on what caused the overpayment of benefits. From best to worst, the types are administrative error, claimant error, and fraud. See 40 O.S. § 2-613.
Administrative Error
If you must have an Oklahoma unemployment overpayment, this is the type you want. Administrative error overpayments happen whenever something OESC did caused the overpayment. Here are some examples of administrative error overpayments:
- A decision that denies your benefits after you were already paid (like if your employer appeals your claim and you lose)
- Payments issue to you before OESC makes about whether you are entitled to benefits
- Receiving benefits from the wrong program, or pool of money (traditional, PUA, PEUC, SEB, etc.)
During the COVID-19 pandemic, you may get notice of an overpayment if you received benefits from PUA instead of regular state benefits or vice versa. This type of overpayment is usually resolved when your weekly claims are reprocessed under the correct program.
Administrative error overpayments DO NOT accrue interest. OESC cannot pursue collection activities (wage garnishments, tax intercepts, etc.) to get the money back. OESC can collect payment on these overpayments in one of two ways: benefit offset or you decide to voluntarily repay it. Benefit offset happens when you file a claim again in the future and are approved, and your benefit payments are credited to the overpayment instead of paid to you. OESC can collect on the overpayment for only a limited time. Essentially, OESC has about 2 years to recoup on this type of overpayment. After that time, you are no longer liable for any outstanding balance.
Claimant Error
The next type of Oklahoma unemployment overpayment is claimant error. A claimant error overpayment occurs when you do something that causes payments to be issued when they shouldn’t. This type of overpayment very commonly happens when you returns to work. Often the new job won’t issue your first paycheck for a few weeks, so you just keeps filing for unemployment. But when you are working full-time, you are NOT unemployed and NOT entitled to unemployment benefits. Read this post for information about working and filing for unemployment benefits.
Claimant error overpayments DO accrue interest at 1% per month until the interest equals the principal. In other words, if you don’t make payments, you could end up paying double the original amount.
The overpayment principle can be paid through a benefit offset if you are approved for benefits again at a later time. However, you must always pay any accrued interest out of your own pocket. If you’re no longer receiving benefits, OESC will begin sending monthly statements to you just like you would expect to receive for any other debt. If you do not make monthly payments, OESC can start collection activities to get the money back, such as wage garnishments and tax intercepts. OESC can collect on these overpayments indefinitely. During the 2008-09 recessions, I spoke to a man who had an outstanding balance on an overpayment from 1976 that OESC was collecting through benefit offset!
Fraud
Every time you file a weekly claim, the last question asks whether you certify that your answers are true and correct. If you answer “yes” and OESC finds out later that you intentionally gave false information, OESC has the right to classify your Oklahoma unemployment overpayment as fraud.
All of the information about claimant error overpayments also applies to fraud overpayments. But there are 2 BIG differences. First, fraud overpayments include a penalty of 25% of the principal. And second, you are prohibited from filing another unemployment claim for 1-2 years. See 40 O.S. § 2-402.
Pay Attention to ALL Decisions Received from OESC
A notice of overpayment is almost always issued along with another decision that explains why you’re denied benefits. So if you receive an overpayment notice, make sure you watch for the other decision too. For example, if you were initially allowed benefits, but you were denied on appeal, you would receive an Appeal Tribunal decision AND an overpayment notice within a few days of each other. If you want to appeal an overpayment, you MUST appeal the related decision that caused it. Make sure to file your appeals within TEN CALENDAR DAYS of the date the decisions mailed to you. Overpayments have a 20-day appeal period, but the decision that caused the overpayment has a 10-day appeal period. Appeal within 10 days to make sure you meet the deadline.
Your Next Steps
- File appeals for the Oklahoma unemployment overpayment AND the decision that caused it within 10 CALENDAR days of the date the decisions mailed to you. Information about how to file the appeals will be on each of the decisions.
- Schedule a meeting with me to discuss how I can help you at your hearing.
As always, if you have questions about overpayments or anything else related to unemployment, let me know. I’m happy to help!
