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62. Can the Claimant Get an Overpayment of UI Benefits Waived or Requalify for UI Benefits?

Waiver of Overpayments

If the hearing or other decision is adverse to the claimant, DUA may assert that UI benefits have been overpaid. Sometimes that assertion results from a redetermination of eligibility under G.L. c. 151A, § 71. Other times an overpayment is assessed because an initially favorable eligibility decision is overturned on appeal. However, under G.L. c. 151A, § 69(c), repayment is not mandatory.

You should always investigate the possibility of a waiver of overpayment if you can demonstrate that the overpayment was not the claimant’s fault. A waiver is not allowed if there is a finding of fraud, which is why it is critical to dispute an erroneous fraud finding. If the overpayment was not due to misrepresentation or fraudulent intent on the claimant’s part, the claimant may apply for a waiver of the outstanding balance of her overpayment pursuant to G.L. c. 151A.  DUA’s regulations on waivers of overpayment are found at 430 CMR 6.01 – 6.13. A waiver will be granted if you can show that the recovery of payments “would defeat the purpose of benefits . . . or would be against equity and good conscience.” 430 CMR 6.05(1). These provisions have been interpreted to mean that either the repayment of UI benefits would cause financial hardship, or that the claimant relied to the claimant's detriment on the receipt of the UI benefits at issue. AH c. 9, § 5G. The claimant only needs to meet one of these tests, but legal services clients frequently meet both prongs. If applicable, enter evidence of eligibility under both prongs.

Where a claimant’s household does not have sufficient income to meet the family’s ordinary and necessary living expenses, the Board has determined that, “as a matter of law,” the claimant has satisfied the burden of proving that recovery of the overpayment would defeat the purpose of benefits. BR-204100 (5/13/14); 430 CMR 6.03 Definitions, Against Equity and Good Conscience; BR-0016 7936 34 (3/9/16) (Key) (income for determining waiver does not include non-liquid assets); BR - 0018 0079 19 (11/7/16) (Board reversed denial of waiver on several grounds including that the review examiner erroneously used claimant's income before taxes).  BR-0022 6462 67 (3/29/18)(Board reversed denial of waiver where review examiner erroneously converted weekly expenses to monthly expenses and used the claimant’s gross income rather than net income); BR-028 2398 81 (6/28/19) (Board reversed denial of waiver where the claimant’s monthly expenses exceeded his monthly income after taxes).

In determining whether repayment would be “against equity and good conscience,” DUA looks at whether if due to the overpayment the claimant relinquished a valuable right or changed their position for the worse.” 430 CMR 6.03 Definitions, Defeat the Purposes of Benefits Otherwise Authorized.  For example, a claimant may have been eligible to receive welfare benefits, had he not received UI benefits. He relinquished his right to welfare benefits, and cannot collect them retroactively if he repays the UI overpayment.” SRH § 1472(C); BR - 0018 0079 19 (11/7/16) (claimant's one time expenditure for daughter's technician course constituted a "change in position" supporting a waiver of overpayment). The waiver application does not include much space to articulate eligibility under the “equity and good conscience” test, and ideally an advocate should include a cover letter explaining why your client is eligible under this prong of the statute.

DUA should notify the claimant of the right to request a waiver at the time it issues the determination regarding an overpayment. If DUA denies the request for waiver, the claimant has the right to file an appeal and have a hearing on the matter. 430 CMR 6.09. This hearing does not include an opportunity to revisit any substantive issues regarding the underlying eligibility for UI benefits. 430 CMR 6.13. The claimant may then appeal the hearing decision to the Board of Review, and then to the court. The time frame and the procedural steps for filing overpayment appeals are  the same as that for appeals of disqualification.  G.L. c. 151A, §69 (c).

A Waiver Application form is available on the claimant’s UI Online account or can be requested from DUA so that it contains the claimant’s bar code. Waiver applicants should be prepared to submit supporting documentation (e.g., copies of utility bills, rental agreements, mortgage documents, grocery receipts, etc.) with their request for waiver of an overpayment. A sample waiver letter, which lists the information DUA requests in order to act on a waiver application, is included as Appendix D. The information in the waiver letter should accompany the UI Online form that requests financial information and includes the claimant’s bar code.

Under G.L. c. 151A, § 71, DUA has one year from the date it determined that UI benefits were overpaid to pursue the recovery of those benefits from the claimant. If DUA alleges that the overpayments were the result of a misrepresentation of fact, it has four years in which to pursue recovery.

Advocacy Note: DUA began a practice of denying waivers for claimants who clearly meet the standard for eligibility under the regulations notwithstanding the absence of a change in state law or court interpretations. Challenging this practice, GBLS filed a lawsuit, Castillo v. Dep’t of Unemployment Assistance, Suffolk Superior Court, CA No. 15-85-CV-2960 The case was recently settled under these terms:

Retroactive relief: DUA has agreed that 660 UI claimants and former claimants’ waivers should have been granted. DUA forgave $2.5 million of debt these workers owed DUA.

Prospective Relief: DUA has promulgated a new regulation stating that recipients of Supplemental Security Income (SSI) benefits, (including SSI recipients who also receive some Social Security Disability Insurance (SSDI), benefits) or Emergency Assistance to Elderly, Disabled and Children (EAEDC) benefits will be presumptively eligible for a waiver. 430 CMR 6.05(3)(b). TAFDC recipients should still be able to demonstrate eligibility but will need to continue to complete the financial waiver form.

Notice Relief: DUA has agreed to change that waiver notice so that when a waiver is denied a specific reason is provided as to why the waiver was denied, e.g., your income exceeds your expenses, etc.

DUA’s new policy manual draft states that if no request for waiver is filed within 15 days after DUA informs the claimant of an overpayment, if a waiver of the overpayment is granted, any amount already collected by offset or direct payment will not be refunded. AH c. 9, § 5F.