Paying back unemployment: Arizona DES asking some Arizonans to return 'overpayment' on benefits

In 2020, hundreds of thousands of Arizonans relied on unemployment to avoid foreclosures and evictions amid the COVID-19 Pandemic. Now, we have learned that state officials have started to demand the money back from tens of thousands of formerly unemployed people.

Basically, Arizona officials are saying that as time passed, they have conducted additional reviews and found a lot of people in our state did not actually qualify for unemployment, even though the state told them they did.

For those affected, no one is saying it's their fault, but many are getting bills for thousands of dollars amid a period of high inflation.

Arizonan affected speaks out

One of the people who now have to pay the state back is Melissa Vasquez. She was asked to repay $8,100.

"Can you afford $8,100?" Vasquez was asked.

"No," Vasquez replied.

According to paperwork, DES officials said there was an error, and Vasquez should not have been approved for unemployment. They are calling what Vasquez received an ‘overpayment.’

"Just the unfairness of it," said Vasquez. "You go through the process of it. People were losing their jobs. It was a scary time. I don’t make a lot. To owe it all back is a slap in the face."

Overpayments have happened before

Overpayment letters are not new for some Arizonans. In 2020, we spoke with a man who said he had to pay the state back because of an overpayment.

At the time, William Ramirez said he could not work after a stroke, multiple brain surgeries, and a rare condition involving his spine. Ramirez said DES officials signed him up to extend his unemployment benefits, but later said he owes the agency money.

"I owe $8,000 for your mistake," said Ramirez in 2020. "It wasn’t my mistake. I didn’t ask for it."

Ultimately, Ramirez did not have to repay the money.

"I was like, ‘so you’re saying I don’t have to pay no more?’ And she was, like, ‘no, you’re good.’ I was like ‘alright, thank you,’" said Ramirez.

Many Arizonans affected

"We're talking to folks who are being told they owe back $8,000, $9,000, $10,000 in unemployment," said Joshua Black, an employment attorney.

According to hard data we requested from DES, the agency has requested $41 million back from 31,000 Arizonans. So far in 2021, the agency is seeking $11 million from 10,000 Arizonans. 

These instances of overpayment are called non-fraud, meaning no one is at fault.

It was accidental error.

Black says the new numbers are important.

"It would make sense in any system there's going to be some errors," said Black. "Some folks who fall through the cracks and maybe didn’t qualify and we have to revisit it, but this is a tidal wave of people we're seeing getting these notices."

DES officials respond

In a statement, DES officials said:

"We are committed to collecting overpayments following federal requirements and guidance by the U.S. Department of Labor as it is updated, while continuing to work with individuals and families in unique circumstances to minimize the impact of overpayments whenever possible."