An overpayment occurs when you are paid unemployment insurance benefits you are not entitled to receive. A Notice of Overpayment is mailed to you when an overpayment is established. The notice lists the reason for the overpayment, the section of law that covers the overpayment and the weeks overpaid. There are two types of overpayments:
Non-Fraud
A non-fraud overpayment occurs if you receive benefits you were not eligible to receive, but the Division of Employment Security finds that you are not at fault or you did not intentionally give false information or withhold information to get benefits.
Fraud
A fraud overpayment occurs when you make false statements, give incorrect information or withhold information to receive benefits. Fraud overpayments will cause you to be disqualified from receiving unemployment benefits for one year. In addition to repaying the overpaid amount, you will also have to pay a penalty that equals 15% of the overpayment. Fraud overpayments that exceed $400 can be prosecuted criminally as a felony. The most common causes of fraud overpayments are:
- Returning to work while collecting unemployment benefits and not reporting your work and earnings.
- Working a part-time or temporary job and not reporting earnings.
- Filing for benefits without looking for work.
- Failing to keep a record of your work search.
- Withholding information or giving false information when filing a claim or a weekly certification.
- Failing to report earnings for the week in which you performed work.
- Failing to report pay for training.
- Failing to report severance and bonus pay.
Fraud Prevention and Audits
DES conducts random audits of unemployment claims using wage information from the National Directory of New Hires program, the Wage Cross Match program, and tips and leads. When an audit of your claim indicates that you may have received benefits that you were not entitled to receive, DES is required to conduct an investigation to determine the accuracy of your payments.
During an audit, you will be contacted to participate in a conference. If you are unable to come to the scheduled conference, you should contact the fraud investigator to discuss your options to provide the information needed. In most cases, you may be allowed to submit a statement in writing.
You can avoid investigations and overpayments by:
- Providing complete and accurate information to DES when you file your claim and weekly certifications.
- Actively looking for work.
- Keeping a record of your work search.
- Reporting all wages earned for each week you work and claim benefits.
- Reporting wages when they are earned, even if you have not yet been paid.
- Reporting gross wages (amount earned before taxes and other deductions).
Work Search Requirements
An important part of unemployment insurance is to help you get back to work. You must seek work with at least three employers and keep a record of all your work search activities. You are required to keep these records for five years. If you are audited within that time and you cannot provide your work search records, you will be considered overpaid and required to repay benefits. You can download a Work Search Record online.
Reporting Work and Earnings
While searching for a job, you may have an opportunity to work part-time or temporarily. If you do any work while receiving benefits, you must report it when filing your Weekly Certifications. This includes self-employment, part-time work, work for cash or paid training. You must report all work you did the previous week, even if you have not yet been paid. You must also report your gross earnings, which is the amount that you earned before taxes and other deductions are taken out. Failure to accurately report work and earnings while receiving unemployment benefits will result in overpayments that must be repaid.