DAR File No. 37238

Workforce Services, Unemployment Insurance

Section R994-406-301

Claimant Fault

Notice of Proposed Rule

(Amendment)

DAR File No.: 37238
Filed: 01/31/2013 04:18:24 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The purpose of this amendment is to specify when certain overpayments are fault overpayments.

Summary of the rule or change:

A claimant might receive unemployment benefits to which her or she is not entitled because the claimant under-reported his or her wages. If it is because the claimant was unaware of his or her actual wages at the time the weekly benefit filing was made, the claimant is still liable for repayment of the overpayment amount.

State statutory or constitutional authorization for this rule:

• Subsection 35A-4-502(1)(b)
• Section 35A-1-104
• Subsection 35A-1-104(4)
• Section 35A-4-406

Anticipated cost or savings to:

the state budget:

This is a federally-funded program so there are no costs or savings to the state budget.

local governments:

This is a federally-funded program so there are no costs of savings to local government.

small businesses:

There are no costs or savings to any small businesses as there are no fees associated with this program and it is federally funded.

persons other than small businesses, businesses, or local governmental entities:

There are no costs or savings to any other persons other than small businesses, businesses, or local government entities as there are no fees associated with this program and it is federally funded.

Compliance costs for affected persons:

There are no costs or savings to any affected persons as there are no fees associated with this program and it is federally funded. These changes will not impact any employer's contribution rate.

Comments by the department head on the fiscal impact the rule may have on businesses:

There are no compliance costs associated with this change. There are no fees associated with this change. There will be no cost to anyone to comply with these changes. There will be no fiscal impact on any business. These changes will have no impact on any employer's contribution tax rate.

Jon Pierpont, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Workforce Services
Unemployment Insurance
140 E 300 S
SALT LAKE CITY, UT 84111-2333

Direct questions regarding this rule to:

• Suzan Pixton at the above address, by phone at 801-526-9645, by FAX at 801-526-9211, or by Internet E-mail at [email protected]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

03/18/2013

This rule may become effective on:

03/25/2013

Authorized by:

Jon Pierpont, Executive Director

R994. Workforce Services, Unemployment Insurance.

R994-406. Fraud, Fault and Nonfault Overpayments.

R994-406-301. Claimant Fault.

(1) Elements of Fault.

Fault is established if all three of the following elements are present, or as provided in subsection (3) and (4) of this section. If one or more elements cannot be established, the overpayment does not fall under the provisions of Subsection 35A-4-405(5).

(a) Materiality.

Benefits were paid to which the claimant was not entitled.

(b) Control.

Benefits were paid based on incorrect information or an absence of information which the claimant reasonably could have provided.

(c) Knowledge.

The claimant had sufficient notice that the information might be reportable.

(2) Claimant Responsibility.

The claimant is responsible for providing all of the information requested by the Department regarding his or her Unemployment Insurance claim. If the claimant has any questions about his or her eligibility for unemployment benefits, or the Department's instructions, the claimant must ask the Department for clarification before certifying to eligibility. If the claimant fails to obtain clarification, he or she will be at fault in any resulting overpayment.

(3) Receipt of Settlement or Back-Pay.

(a) A claimant is "at fault" for the resulting overpayment if he or she fails to advise the Department that grievance procedures are being pursued which may result in payment of wages for weeks during which he or she claims benefits.

(b) If the claimant advises the Department prior to receiving a settlement that he or she has filed a grievance with the employer and makes an assignment directing the employer to pay to the Department that portion of the settlement equivalent to the amount of unemployment compensation received, the claimant will not be "at fault" if an overpayment is created due to payment of wages attributable to weeks for which the claimant received benefits. If the grievance is resolved in favor of the claimant and the employer was properly notified of the wage assignment, the employer is liable to immediately reimburse the Department upon settlement of the grievance. If reimbursement is not made to the Department consistent with the provisions of the assignment, collection procedures will be initiated against the employer.

(c) If the claimant refuses to make an assignment of the wages claimed in a grievance proceeding, benefits will be withheld on the basis that the claimant is not unemployed because of anticipated receipt of wages. In this case, the claimant should file weekly claims and if back wages are not received when the grievance is resolved, benefits will be paid for weeks properly claimed provided the claimant is otherwise eligible.

(4) Receipt of Retirement Income.

Notwithstanding any other provision of this section, a claimant who could be eligible for retirement income but does not apply until after unemployment benefits have been paid, is "at fault" for any overpayment resulting from a retroactive payment of retirement benefits. See R994-401-203(1)(d) and (2)

(5) Correcting Earlier Weekly Claims.

If a claimant reports incorrect information about his or her income or earnings, the claimant must immediately contact the Department to correct the information. A claimant who contacts the Department to correct reported income is considered to be "at fault" and is responsible for repaying any resulting overpayment even if at the time the claimant filed the weekly claim for benefits he or she was unaware of the correct income or earnings. A claimant who fails to contact the Department to correct inaccurately reported earnings may be subject to fraud penalties under subsection R994-406-401.

 

KEY: overpayments, unemployment compensation

Date of Enactment or Last Substantive Amendment: [January 2,] 2013

Notice of Continuation: May 22, 2012

Authorizing, and Implemented or Interpreted Law: 35A-4-406(2); 35A-4-406(3); 35A-4-406(4); 35A-4-406(5)