Those $600 unemployment checks will likely soon end. This person never got one

Personal Finance

People who lost their jobs wait in line to file for unemployment benefits, following an outbreak of the coronavirus disease (COVID-19), at Arkansas Workforce Center in Fort Smith, Arkansas, U.S. April 6, 2020.

Nick Oxford |File Photo | REUTERS

In mid-March, Erin Madden was furloughed from her job as a bartender at the Hollywood Burbank Airport. Around the same time, she applied for unemployment in California.

More than 120 days later, she still hasn’t received a payment.

“It’s incredibly stressful,” Madden, 28, said. “It’s been four months of this and I have no idea when it’s going to end.”

The $600 weekly federal unemployment checks that millions of Americans are receiving amid the coronavirus pandemic likely will come to an end this month. Now, Republicans and Democrats are battling over what to to replace those payments with.

But some people are still waiting for the first round of unemployment benefits after state offices around the country were inundated with a gargantuan wave of claims. More than 30 million Americans are collecting unemployment benefits, which is about five times the peak of the Great Recession. 

In Texas, for example, more than 148,000 people who’ve been deemed eligible for unemployment are still waiting for their payments, according to the Texas Workforce Commission. Close to 55,000 people are in the same situation in Florida. 

“The unemployment insurance system has never had as many claims as it has since March,” said Stephen Wandner, a senior fellow at the National Academy of Social Insurance. “The staff is inadequate and the computer systems are old. Hiring and training new staff is a slow process.” 

Erin Madden: ”It’s been four months of this and I have no idea when it’s going to end.”

Source: Erin Madden

In April, Madden heard back from the unemployment office in California. She was asked to provide additional documentation to confirm her identity. The next day, she said, she mailed in a copy of her passport and W-2. 

She’s called the office every week since, she said. ”Sometimes I don’t get through until the 250th ring,” she said. When she finally reached someone, she said, “They told me they had a ton of IDs to verify.” 

People whose unemployment claims get flagged for one reason or another can end up waiting much longer for a decision on their benefits amid the pandemic. Among contested claims, 84% were getting a decision within 21 days in February, according to the U.S. Department of Labor. By June, just 39% were hearing back within that timeline.

“Fraud prevention measures that catch genuinely eligible people are difficult to clear,” said Andrew Stettner, a senior fellow at the Century Foundation and a leading unemployment expert.

Finally, Madden said someone at the unemployment office told her that her identity had been verified and that she should receive her payments within 30 days. But that was in early June. 

Every time Madden called back, she said, she’s told the same thing: “They say, ‘You should be getting it any day now.'” 

They say, ‘You should be getting it any day now.’

Erin Madden

A spokesperson for the Employment Development Department in California said that due to confidentiality rules they can’t discuss individual cases. The Department has processed 8.7 million claims in under five months, which is more than in the highest year of the Great Recession, he said.

“The EDD is in the midst of an expedited mass hiring effort to add 5,300 staff while at the same time enhancing technology systems to gain efficiencies and developing more communication methods for getting claimants the information they need about this week-by-week eligibility based insurance program,” he said. 

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Even though the $600 unemployment checks are scheduled to end this month, claimants will still be owed retroactive payments for the weeks they qualified for them but didn’t receive them, Wandner said. That means they’ll eventually get thousands of dollars. (Though the amount will be less after taxes.) 

“Applicants should get checks, automatic deposits, debit cards for the full amount owed – eventually,” Wandner said.

Still, the wait has left Madden in a precarious situation. 

Before the pandemic struck, she was close to paying off her credit card debt.

Now she’s taken on addition $3,000 to cover her bills, including groceries and her health care premiums. She hasn’t been able to pay her rent in three months.

Her bank account balance dipped as low as -$155. 

“There’s going to be lasting damage to my credit and mental health,” she said.

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