EDD Halting Unemployment Claimants For Two Weeks, Will Overhaul Entire System

Over the weekend, Governor Newsom’s Employment Development Department (EDD) Strike Team issued a new report and announced that the EDD will be taking a two week break to overhaul and update the current system, while also halting all new claims until October 5th.

New EDD unemployment applicants to wait at least two weeks while system is streamlined

The report by Newsom’s EDD “strike team” on Friday found that a backlog of unresolved claims had been growing by approximately 10,000 a day, preventing many claimants from receiving unemployment benefit income, while the backlog was slowly cleared.

Fraud was also found to have been a major factor in delays. Due to millions of dollars of fraudulent benefits paid to fraudulent beneficiaries, and a growing number of fraud cases within the EDD, the EDD has had to enact many large and time consuming verification steps, delaying millions of people renewing or applying for benefits statewide.

With 100 recommendations made on how to streamline and overhaul the current unemployment system, the strike team, who has been working on the report since July, acknowledged how the state had failed many unemployed Californians.

“The State must deliver this benefit to those who qualify within a time frame that’s relevant to the well-being of the claimant, and it was failing to do that for too many Californians,” the report found.

With the Governor’s blessing, the EDD announced the very next day that a two-week hiatus on new cases would begin on September 21st to both reduce fraud and the large backlog in the system. According to the EDD, by October 5th, up to 90% of applicants will have the unemployment process sped up, with unemployment approval also expected to be completed within only a few weeks.

Backlog reduction, better fraud detection on EDD’s update list

A large part of the update will include technological updates. The EDD noted that a large reason for many of their approval delays comes from their reliance on the U.S. Postal System through mailed, paper notices. The current system mails these notices to claimants when a mistake is found on their application, or if a question over their work history comes up. Applicants have to mail back or fax the updated, correct information, as well as provide all needed documentation.

“No one uses fax machines anymore,” said “Mary”, an EDD employee, to the Globe. “It’s a dead technology. And sending letters is a problem too. It takes long, and if you have bad handwriting, an address or name could come out wrong, so it gets thrown into the postal system. You wouldn’t believe how many applicants mess that up with poor handwriting, then blame us when we say we didn’t get it.”

“I don’t know exact figures, but there are around 1.5 million Californians who have been waiting weeks and months for benefits to come and they haven’t. We failed them. But now we’re doing what’s necessary to correct that.”

That system also required manual review by letter or faxes that came in. However, during the next two weeks, an online verification tool will be added, allowing quicker verification through using online databases to make what once could take weeks into an almost automatic approval for some.

The overall backlog will also be tackled, as the Department plans to add more staff to phone lines to handle cases that have taken longer than 3 weeks to quickly reduce the backlog. The expansion of technology in dealing with beneficiaries will be designed to not only be quicker, but also more user friendly, with the goal of removing all backlogged cases by January.

“New claimants should not see a delay in benefit payments, and in fact many of them will actually get their payments faster as they avoid the older time-intensive ID Verification process,” EDD Director Sharon Hilliard explained to Governor Gavin Newsom on Friday.

Lawmakers criticize EDD’s decision

However, the overhaul of the EDD has brought out a large wave of criticism from both Democratic and Republican lawmakers alike.

Many have said that the two week delay in allowing new claims in inexcusable, especially during a time when COVID-19 and wildfires have led to a constant continuance of new joblessness claims. The goal of ending all backlog by January has been a particular sticking point for many, as that could mean that people may not see much needed unemployment assistance until early next year.

“It’s overwhelming. People are hurting and living off their credit cards,” said Senator Scott Wiener (D-San Francisco) in a statement. “They are saying that it’s going to take months and months for them to clear this backlog and that is unacceptable.”

Others zeroed in on the Governor and the EDD not being transparent over the matter, as well as the report itself revealing dozens of faults that needed fixing showing that they had knowingly hurt millions of Californians since March.

“The constant delays and failures at the EDD highlight Governor Gavin Newsom’s inability to properly prepare for shutting down California’s economy,” explained Senate Republican Leader Shannon Grove (R-Bakersfield), who helped push for EDD audits on the myriad issues. “What did Governor Newsom expect when he closed down tens of thousands of businesses and put millions of Californians in the unemployment line?”

Grove continued: “199 days after the governor shut down California’s economy and millions of people lost their job, the Governor’s Strike Team issued a report stating that EDD has yet to resolve problems on more than 1.5 million claims, call centers are non-responsive and verification processes are not stopping fraud. Some Californians have been waiting since March to receive help. The delays, lack of transparency from the Governor, and mismanagement at the EDD are not only disappointing, but they are insulting to the California families who so desperately need this help.”

Senator Jim Nielsen (R-Tehama) agreed with Senator Grove: “Since the Governor shut down the state’s economy in mid-March, approximately a third of California’s workforce, or more than 6 million people, have applied for unemployment benefits, according to the California Policy Lab,” said Senator Nielsen in a statement. “Six months later, more than 1.5 million Californians have yet to receive help. They have exhausted their savings, racked up credit cards and borrowed from anyone willing to lend them money. These people are not numbers or cases; they are our friends and neighbors.