LAS VEGAS (KTNV) – We are closing in four months without a paycheck or unemployment payments for many people in southern Nevada.
The Nevada Department of Employment, Training and Rehabilitation (DETR) faces a court hearing on July 7 in response to a class action lawsuit asking the state to make its payments.
13 Action News chief investigator Darcy Spears has spent weeks investigating where things went so wrong.
He discovered what a former insider calls negligent and egregious.
In a memorandum to the DETR administrator and presented as legislative testimony, Steve Zuelke cites avoidable delays, available solutions, and experts who wait in the wings to help but never resorted.
“They missed a lot of opportunities outside the door and that’s very unfortunate,” said Zuelke.
The former DETR informant says that if the leaders of the Nevada unemployment office had taken control of this crisis, things would be much better.
Instead, “it is implosing on itself.”
And people who were approved for payment months ago are struggling with system failures, stuck phone lines, and inaction.
This is what Zuelke expected from the agency from which he retired after 25 years: “In front of humanity, in front of tens of thousands of people who are losing everything due to the inefficiencies of the system and the lack of stable leadership, someone come in and we say we need to get all the stops out. “
Apparently that did not happen. So, something else did: a class action lawsuit filed in Washoe County against the state unemployment division, its directors and administrators.
Tabitha Asare and Scott Howard are two of the named plaintiffs. When 13 Investigators met with them, Howard was wearing a mask that said, “Not paid yet! Press the pay button.”
Asare turned her sewing skills into mask making when COVID-19 closed her custom dance costume business.
“I had to choose between the business and my daughter and I eating,” said Asare. “And it has been very, very difficult.”
Howard was an Uber driver who says, “I have maximized my credit card by paying for car insurance, car payments. It is amazing and I have had no problem with my claim for more than six weeks.”
PUA Plaintiff: ‘I am disappointed,’ Nevadans, 13 Action News seek answers on unpaid unemployment
The lawsuit alleges the failure to pay about 60,000 Nevada workers for half a trillion dollars in unemployment compensation “when due,” which means as quickly as possible once initial eligibility is determined.
Mark Thierman, the attorney for the case, says: “What they are asking DETR to do is do their job, which by the way, in this case, is to pay money!”
Like Asare and Howard, plaintiffs Elaina Abing, Charles Ploski, William Turnley and Isaiah Pavia-Cruz filed an application in May and were approved for benefits, but were never paid.
When Pavia-Cruz received someone from DETR on the phone, “he looked at my account and said that everything looks good, it has already been reviewed, they just did not press this mythical button that says ‘pay’.”
They told him it would only be a day or two. Also Asare and Howard. Then another week passed with nothing.
“And the lady tells us, ‘Oh, it will be 21-30 days. I don’t know who told you 24-48 hours. They lied to you.’ She also told us that our claims were stuck in limbo and that we should not really depend on it. money, “Asare said, after speaking with a DETR representative.
“Why did it go from 24 hours to 21 days?” Spears asked.
“Due to some technical problem,” Asare said. “They told us it was a system failure where the computer was not recognizing that it was really paying us.”
DETR has turned down all 13 requests for Investigations for on-camera interviews, saying the staff is too busy.
Every time 13 Investigators asked about a recently reported technical problem, the director’s office gave the same response, which says: “We are working with the supplier on the reported items and monitoring the site.”
“Blaming the seller is not appropriate in my mind,” said Zuelke. “They chose the provider. They should provide as much information and oversight about the program as the provider.”
In addition to that, the lawsuit says DETR is misinterpreting and misapplying labor laws when it comes to self-employment and workers.
He says DETR’s computer system marks claims for problems when there are none and manual override can take up to a month.
Zuelke says he knows how to fix that.
“Use the technology that is available to them to make a massive change rather than as one-off decisions,” he said.
The lawsuit also accuses DETR of misleading the public about the actual number of unpaid claims.
Zuelke says DETR was configured to fail.
“You can’t leave so many people out of work at the same time in a program that is underfunded and under-staffed, and you don’t expect some kind of train crash,” said Zuelke.
But it also says that administrators have compounded the problem by not using their authority to make general determinations to ensure that eligible claims are paid more quickly.
“While the division has really good people working for them right now, they don’t have leadership experience,” said Zuelke.
In April, the Employment Security Division was authorized to rehire retirees. Zuelke and others offered to help, but he says DETR didn’t bite … Instead, they hired inexperienced judges and he can’t understand it.
“If I had been in this situation and faced this type of crisis, the first thing I would have done was pick up my phone, call all the retirees that came to mind and say, what do they have for me? How do we deal with this? ” Zuelke said.
As things stand, the plaintiff in the Turnley lawsuit says, “People who answer the phone don’t really realize what’s going on.”
“There has been no communication from DETR, from PUA, from anyone!” Isaiah Pavia-Cruz added.
Abing simply says, “Let us know what’s going on!”
Zuelke says the simple website tweaks could provide clear guidance on why payments are on hold and how to facilitate resolution.
Then there is DETR’s claim that fraudulent apps are bogging things down.
“I think someone is using that as an evasion somewhere just to defend the lack of work,” plaintiff Ploski said.
“I ran the fraud unit for the state for a period of about 10 years,” said Zuelke, who acknowledges that there is great identity theft, but cites easy ways to tackle it.
“For example, in the PUA program, they might simply require the person to upload a copy of a photo ID,” he said.
Other states, including Washington, New Hampshire, and Oregon, have asked the National Guard to help validate the claims.
RELATED STORY: How are other states managing the accumulation of unemployment claims?
Nevada has not done that.
Howard contacted all Nevada state and federal leaders.
Only 3 responded.
“And I’m going to vote for someone else,” he said of those who did not respond. “I don’t care if it’s a dog running against you, you’re not going to get my vote.”
In the 3 days after 13 Investigators interviewed the plaintiffs in the class action lawsuit, 4 of them got their money. That was after waiting an average of 4 months.
And while the state does not answer questions, DETR filed a response to the lawsuit on July 1.
DESTROYING RESPONSE TO CLASS ACTION
“Everyone in the Nevada government and this procedure agree that each and every eligible beneficiary must receive benefits. This dispute centers on eligibility”
They argue that the initial letters that people received with monetary amounts only showed what they would receive if they were eligible. They say it was not approved for payment.
They also say that the reduction in earnings will not make a worker eligible for PUA benefits, but rather total suspension of activities by the independent worker / contractor is required.
“The United States Department of Labor could cut DETR if it doesn’t follow the letter of the law when it comes to fraud and overpayment.” They say the lawsuit would compel them to violate the DOL’s guidance and risk losing federal funds.
They claim that in an unprecedented situation with significant new programs, the numbers show that DETR has paid most of the claims eligible for the determination.
DETR has publicly stated that, like other states, it is seeing an unusually high level of potential fraud in the PUA program compared to the Unemployment Insurance Program.
They claim that if the court forces them to pay without review for fraud, approximately $ 2.4 million would go to fraudulent applicants.
Because PUA does not include an employer (removing that critical check to establish unemployment eligibility) it is more susceptible to fraud. They also cite the high risk of forged documents and false statements made by concert workers who do not have a quick and easy way to verify. They add that part of fraud detection includes “a random sample claims audit to detect fraud.”
As for the DETR computer system, they say the coding for this has been complex and took several weeks of testing to make it functional.
They say payments will be made as soon as administratively feasible while handling an avalanche of claims that fell to an agency staffed to handle approximately two percent of that number.
They focus on finding ways to improve automated claim processing while processing multiple years of work in a matter of weeks.
In conclusion, DETR told the court: “During an unprecedented global pandemic, Nevada seeks to pay all eligible citizens under the old and new programs to ensure economic survival for themselves and our state. However, to continue to do so, Nevada must meet federal requirements. Otherwise, all benefit recipients are at risk of future payments being withdrawn by the federal government, to further harm to all of us. “
RESPONSE OF PLAINTIFF’S ATTORNEY (CLASS ACTION PLAINTIFF’S ATTORNEY):
“DETR excuses its failure to pay benefits when it reaches on the grounds that its task has been made impossible by DOL guidelines and regulations, along with suspicion of mass fraud. “
They are engaged in a “witch hunt that threatens the well-being of thousands of innocent plaintiffs.”
Other states that must follow the same guidelines have paid 95% of PUA applicants within two weeks of their initial application.
DETR has become bogged down with unnecessary and unauthorized procedures causing administrative paralysis and unreasonable delays.
If DETR can only judge each pending claim individually, it would take all eight state judges until the end of 2023.
The case is simply asking for a payment for what they call “failsafe” groups.
ATTORNEY’S NOTE: If you are a concert worker and are still awaiting your unemployment compensation, you are covered by this class action lawsuit unless specifically excluded in court. You do not have to “join” to be a class member.
In addition, the plaintiff’s response to DETR’s response is available here.
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