Virginia expects to wipe out pandemic unemployment backlog next summer

The Virginia agency that processes unemployment benefits has made progress clearing pandemic-related backlogs, but it isn't expected to finish until next summer, a top official told lawmakers this week.

Jeff Ryan, chief deputy commissioner of the Virginia Employment Commission, told lawmakers at an oversight committee meeting Wednesday that so-called first-level appeals are the largest backlog pressure point, with an estimated 45,000 cases the agency doesn't expect to clear until July 2024.

Ryan also said the agency has sped up first-time payments, though he acknowledged continued struggles to provide some core services. Ensuring all customers can log in to an online claims portal while blocking fraudsters remains a hurdle, he said.

“We're remarkably well on our way to completing the backlog," he told members of the Commission on Unemployment Compensation.

Republican Gov. Glenn Youngkin campaigned on a pledge to improve performance at the agency, which officials have said was at an especially low staffing level when the coronavirus pandemic began. Government measures intended to slow COVID-19's spread led to a surge in jobless claims. The employment commission, like many other state agencies, couldn't keep up and by some federal metrics, its performance was exceptionally poor.

While some lawmakers said they appreciated improvements the agency has made, they also continue to hear complaints.

After Ryan told the panel that customer service measures like call-back and wait times at call centers were improving, Democratic Del. Elizabeth Bennett-Parker said she'd heard differently from residents of her northern Virginia district. She said she tried getting through to the call center line just before Wednesday's meeting and received an error message saying call volume was too high.

Ryan acknowledged the queue is “maxed out” at times, but said he didn't have numbers detailing how often customers encounter that problem.

Jonathon Brashears told the group he'd traveled from Virginia Beach in “desperate hopes” of finding someone to help him with a claim stemming from a July 2021 layoff. Brashears, whom Ryan pledged to assist, described a series of agency errors and poor customer service, calling the experience “a nightmare.”

“The VEC is not incompetent. They’re just working with limited resources within extremely challenging circumstances," said Democratic Sen. Adam Ebbin, who leads the legislative panel and has pushed for more agency funding.

Ryan said a bright spot for the VEC and Virginia at large was the strength of the state's labor market.

The unemployment rate in October was 2.7%, and labor force participation rates have been steadily rising. In October, the rate stood at 66.8%, higher than it was before the pandemic and higher than neighboring and competitor states like Florida, Texas, Georgia, North Carolina and South Carolina.

Ryan also told lawmakers the agency has made significant progress improving the percentage of claims paid within 21 days.

For the third quarter of this year, that rate was 65.8%, the highest in the past two years, Ryan noted, though it's still below the 87% the federal Department of Labor considers acceptable.

The average wait on the agency's first-level appeals was 516 days in the same quarter, third-worst in the nation, according to the Department of Labor, which says that number should be 30 days or less.

“What that means in practice is that when that first decision is wrong, it’s going to take 17 months to fix when it should be fixed in a month,” said Flannery O'Rourke, a staff attorney at the Virginia Poverty Law Center.

The attorney general continues to pursue fraudulent unemployment claims, and total court-ordered restitution so far stands at about $360,000, Ryan said. The employment commission has paid out more than $1.7 billion in fraudulent claims, according to figures provided Thursday by a spokeswoman.

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