TOPEKA, Kan. (AP) - When Andrew Knight’s unemployment benefits landed in his bank account on a recent Monday instead of Thursday as usual, he thought the payment was merely early. He swiftly spent it paying rent and other bills.
But Knight and an unknown number of Kansans now face negative account balances after the Kansas Department of Labor late last week clawed back $7 million in duplicate benefits paid out to 4,500 people in error.
Knight’s overdraft charge could total more than $200, a bill the laid-off dining supervisor at Holland Pathways, a substance abuse treatment center in Wichita, can’t afford. He’s already behind on his car payment and just caught up with rent.
“We didn’t get a letter, an email, and this just happened out of nowhere,” Knight told The Wichita Eagle. “Now we’re responsible and out of money.”
On June 22, Gov. Laura Kelly’s office disclosed the labor agency, KDOL, had withdrawn the duplicate payments without first notifying the governor’s office. Kelly’s office also announced the resignation of Labor Secretary Delia Garcia.
Garcia’s resignation marked the end of a tumultuous few months at the agency, which struggled to handle a wave of unemployment claims brought on by pandemic-related layoffs. But while Kansans had been frustrated all spring while trying to obtain benefits, the clawback sparked anger among unemployed residents because it took money out of bank accounts at a time when they’re without income.
Jolene Olson, a Wichita resident who receives pandemic unemployment assistance (PUA) benefits, said she got an email recently from KDOL saying she had received a double payment. But she said no duplicate payment had been made to her account.
“So I just kind of ignored it,” Olson said. “But lo and behold on Friday there was a withdraw from my bank for $1,088, which is what my weekly allotment is. But I didn’t receive a duplicate. So they basically at that point took my own money.”
Olson said KDOL also didn’t send her the weekly payment she should have received. Combined with the withdrawal, she said she’s now in the hole for $2,178.
Olson said her account didn’t overdraft, but she has instructed her bank to not allow any additional withdrawals by KDOL. She also reported the withdrawal to the bank as “fraudulent.”
“I think we have enough for a class action suit at this point,” Olson said.
Kelly told reporters that her office was examining reports that individuals who hadn’t received benefits also had funds taken from their accounts.
The governor’s office said KDOL is working with banks to reimburse benefit recipients with overdrawn accounts. The agency also plans to create a hotline and email for affected residents.
Kelly’s office said the state plans to hire specialists to improve response times for Kansans applying for benefits and cut down on future backlogs and errors in delivering payments.
“As Governor, I’m responsible for KDOL’s handling of unemployment claims. I am taking immediate action to ensure Kansans who are out of work, through no fault of their own, are getting the assistance they need,” Kelly said in a statement.
Employees at the KDOL likely aren’t working under ideal circumstances, the same as lots of other workers in Kansas, said Joseph Mastrosimone, an associate dean for academic affairs at Washburn University who teaches labor and employment law.
“It just looks like an agency that is overtaxed,” he said.
KDOL will continue to play a critical role in the state over the next year or so, Mastrosimone said. He said it’s a time for the agency to communicate with unemployed residents about the challenges and expectations moving forward.
Knight said he spoke with his bank and hopes he will only be responsible for a portion of the overdraft fees.
His main concern now is how the KDOL will process reimbursement for the benefit recipients affected. Like others, Knight said he had trouble getting through to the agency a month ago to ask questions about unemployment. He worries about getting through now, too.
“I’m just one of them,” Knight said. “Just imagine what other individuals are facing.”
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