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Tuesday, June 15, 2021
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An outdated system and an influx of claims led to a backlog that the DWD says they cleared at the end of 2020. Many Wisconsinites have faced obstacles with their claims, but now the state government cannot agree on a way to begin modernizing the system. 

State leaders disagree over fixing outdated unemployment system

Gov. Tony Evers and the Republican-controlled legislature cannot agree on a way to begin modernizing the unemployment system that left many Wisconsinites stuck in the process as the pandemic worsened.  

During the pandemic, some Wisconsinites have waited months to receive benefits. One applicant currently waiting for payment is UW-Madison senior and former Daily Cardinal writer Ben Farrell, who lost his job at Porter - Bandit after the cafe experienced financial hardships related to the pandemic

Last week, Farrell applied for backpay for each of the twelve weeks he was not working. Based on “anecdotal evidence” he’s heard, he thinks it’s “highly unlikely” that he would receive payment within two weeks. 

“If loads of people are going to start looking to [the system] as a way to keep their lives moving forward, then it definitely needs to be faster,” Farrell said. 

The Department of Workforce Development (DWD) announced in late December that they “reached a workload comparable to seasonal pre-pandemic levels,” effectively clearing a large backlog, according to Secretary-designee Amy Pechacek. 

Farrell said he is not worried about paying for groceries or being evicted from his apartment, but is trying to maintain a good financial position as a student. 

“For me, I can sit here and twiddle my thumbs,” he said. “But if I had been given the level of information I was and were in more significantly dire financial straits, I would be freaking out.”

A December Legislative Audit Bureau report showed that as of October, the DWD paid over half of initial claims for regular program benefits within two weeks. It took the department more than five weeks to pay nearly a quarter of them. The average time the DWD took to pay claims declined between March and August.

The DWD was responsible for 11 of the 13 weeks on average that it took to resolve the claims of 250 of 268 individuals who filed initial claims from March 15 through April 11 and had not received payment as of June 20. According to the bureau, that means the DWD was not resolving issues even when it had the information to do so, or was not requesting necessary information from individuals and employers. 

The DWD responded that those measures of inactivity do not “correlate directly” with the agency’s processes, noting that some timelines might be outside of the department’s control. Still, Pechacek noted that the delays were “undisputed.” 

According to the DWD, the department has processed more claims since the onset of the pandemic than they handled from 2016 to 2019 combined. Over half a million claimants have been paid over $4.9 billion in benefits. 

In the most recent three weeks reported by the DWD, at least 3,980 people in Dane County alone filed initial unemployment claims. Over 23,000 weekly claims were filed in the county during that time period.

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Gov. Tony Evers fired Secretary Caleb Frostman in mid-September after facing pressure from Republicans over a huge backlog of claims that accumulated during the pandemic. Days later, the Legislative Audit Bureau reported that less than one percent of calls to the agency were answered between March 15 and June 30. 

Farrell said he called the department to sort out some confusing parts of the application, including adding information about previous freelance work and determining what full-time work means as a student. He said the department quickly answered the phone and was able to go into the system to help him edit his application. 

“Maybe I was on hold for two minutes,” Farrell said, adding that he’s heard of other cases where people were put on hold for much longer. “Putting myself in the shoes of somebody whose living situation or food security is on the line, and you’re f*cking waiting on hold, I can’t even imagine.” 

Technical difficulties

On Wednesday morning, the Senate Committee on Economic and Workforce Development heard from Wisconsinites who spent multiple months stuck in the process and called the DWD hundreds of times for assistance. Multiple speakers said DWD employees gave them conflicting information. They also said they received more help from their state representatives than they did from DWD. 

Victor Forberger, an attorney specializing in labor and unemployment, said modernization would be a long process that could take up to four years. He estimates the hearing backlog for appeals is about 25,000, saying one of his clients may not receive a hearing until October 2021. Pechacek later testified that as of Saturday, 3,400 adjudication issues were awaiting scheduling. 

“If you want to fix this problem right now, put legislation on the floor tomorrow removing some issues,” Forberger said. “If the department won’t do it through its emergency rules process, you need to do it through the law.” 

Immediately before the hearing, the DWD held an informational briefing on unemployment modernization, explaining how technological constraints continue to impact their operations. 

In response to the volume of claims early in the pandemic, the department nearly quadrupled their staff and hired additional adjudication specialists. In October, the agency partnered with Google Cloud to shorten adjudication time and release payments faster. 

Secretary-designee Pechacek said the department is “constantly facing the possibility of falling behind again” and said initial investments in the system are needed now. 

“The only path to preventing and preparing for future crises like the one we’re working through now is a comprehensive modernization of our IT system,” Pechacek said. 

The department pointed out the system’s inefficiencies, including its outdated programming language and reliance on paper documentation and communication. 

The addition of new federal programs, such as Pandemic Unemployment Assistance, also added “layers of complexity” which overwhelm the system’s capabilities. 

The department took incremental steps toward modernization between 2008 and 2018 but tried to quicken the pace in 2019. The DWD is currently in the process of adding a portal interface with the help of Google that will allow for document uploads and secure online messaging. 

Political impasse over fixing system 

Both Democratic Gov. Tony Evers and legislative Republicans pointed out issues with the unemployment system in early January. In his State of the State address, Evers said both parties are to blame for the antiquated system, while Assembly Speaker Robin Vos, R-Rochester, criticized the governor’s handling of the influx of unemployment claims. 

“Previous administrations and more than a decades’ worth of legislators have known this system was outdated and couldn’t handle an economic crisis like the one this pandemic presented, and they never took the time to fix it,” Evers said. 

The DWD planned a major overhaul of the system under former Democratic Gov. Jim Doyle’s administration, but the initiative was ultimately abandoned. During Republican Gov. Scott Walker’s administration, a 2014 audit found up to 80 percent of calls were blocked, the Milwaukee Journal Sentinel reported

After the address, Evers called for a special session of the legislature to take up his initial $5.3 million plan to modernize the system, which would also require employers to file employment and wage reports electronically. 

However, the Republican-controlled legislature opened and immediately adjourned the special session and called on Evers to “take ownership of the problems” and use available funding to upgrade the system. 

Democrats in the legislature expressed disappointment with Republicans who rejected the special session. Sen. Bob Wirch, D-Somers, noted that his office had heard from “hundreds of people whose claims were held up simply because of the antiquated system.” 

The Republican lawmakers released a memo from the nonpartisan Legislative Fiscal Bureau detailing accounts Evers could use, but only one of the accounts had enough money and it was unclear whether it could be used for computer upgrades, the Milwaukee Journal Sentinel reported

The co-chairs of the Joint Finance Committee repeated the Republicans’ argument in a letter to Evers on Tuesday, asking him to make a request to the committee to consider supplemental funding “as a last resort.” 

“We also must point out the confusion that has been caused by your call for a Special Session. You claim to need legislative approval for the project even though just weeks ago your administration found more than $1 million dollars to sign a contract with Google to help with unemployment claims. No legislative approval was needed for that decision. Why now?,” Rep. Mark Born, R-Beaver Dam, and Sen. Howard Marklein, R-Spring Green, wrote

Evers’ office did not respond to a request for comment asking whether he would try to use existing funds to begin his plan to modernize the system. 

Sen. Andre Jacque, R-De Pere, expressed concern that an IT upgrade was not included in the department’s biennial budget request. Sen. Janis Ringhand, D-Evansville, said the $5.3 million would be a starting point and is looking forward to seeing upcoming budget projections. 

The potential computer upgrade is likely to remain a political issue during the upcoming state budget process, especially as Evers’ proposed investment into the system totals about $90 million over 10 years.  

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Hope Karnopp

state news writer

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