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Gov. Tony Evers asks Wisconsin DWD leader to resign over unemployment backlog

Molly Beck
Milwaukee Journal Sentinel

MADISON – Gov. Tony Evers has in effect fired the leader of the state’s workforce development agency, which has struggled for months to clear a massive backlog of unemployment claims since the pandemic hit Wisconsin.

Department of Workforce Development Secretary Caleb Frostman left his job Friday after Evers asked for his resignation the same day.

The governor had grown increasingly frustrated in the lack of progress in clearing the claims and getting benefits to those who deserve them despite increased resources and staffing for the agency, a source close to the governor’s office told the Milwaukee Journal Sentinel.

Frostman’s resignation comes at a time when nearly 100,000 Wisconsinites are waiting to hear whether they will receive unemployment benefits.

Nearly 3,000 have been waiting since March and April, when the coronavirus pandemic hit the state forcing thousands of people out of work when Evers shuttered non-essential businesses to curb the virus’s spread.

So far, more than 513,000 Wisconsin residents have applied for weekly unemployment benefits amid the coronavirus pandemic. They have submitted over 6.5 million applications for benefits since the pandemic hit, according to department data.

But nearly 11% of those weekly claims are still waiting in a backlog of over 713,000 claims as of Sept. 12, according to the data. Some of those claimants have been waiting since March,

Those who have been waiting since the early months of the pandemic haven’t received benefits yet because of complicated situations that give rise to a lengthy adjudication process, the department said.

There’s no estimation for when those early claims will be cleared nor for when the backlog of claims will be eliminated, department officials have said in recent weeks.

In a video forum organized by the Milwaukee Press Club last week, Evers said it was unacceptable that so many people had waited months to find out whether they qualified for benefits.

“I hope in the near future to be able to say definitively when we can … solve all the problems we have,” he said. “It’s time for us to catch up and it’s my hope to set a date in the near future.”

But the Republicans who control the state Legislature have said Evers has not demonstrated enough urgency on the issue, and called for the governor to increase hire more employees and provide temporary loans to people waiting for benefits.

Wisconsin is not the only state experiencing such delays, but it is among states with the largest number of people still waiting six months after the virus began to spread here.

Since the pandemic hit, the department hired more than 1,000 employees to answer phones and adjudicate cases.

Another complication has been the system the agency uses to process claims.

At least three administrations and hundreds of lawmakers over the last two decades knew that the state’s unemployment system was outdated and had trouble keeping up when job losses spike — a weakness now under the spotlight.

Lawmakers and state officials knew in 2007 that the system used to process unemployment claims needed to be brought up to date. In 2014 an audit showed that as many as 80% of the calls the agency received asking for help were blocked because of the system’s limits during times of high unemployment.

“It can be challenging for DWD to handle significant, temporary increases in calls during certain times of the year,” state auditors wrote in December 2014. “If the steps that DWD has planned are insufficient and large numbers of calls are blocked in the coming months, DWD may need to take additional action.”

That warning came nearly a decade after state officials abandoned a project to replace the department’s 1970s-era system used to track unemployment-insurance claims and appeals — an effort that would have taken years and cost tens of millions of dollars.

The longstanding flaws have resurfaced and contributed to a backlog of unprocessed claims that numbered nearly 400,000 at one point in the past six montsh.

Frostman said in late May that he expected to make headway on this year’s backlog of claims in June, but also said hiring and training all the needed workers might not be complete until October.

Amy Pechacek, deputy secretary of the Department of Corrections, will move to the agency until Evers appoints a new secretary.

Pechacek has a bachelor’s degree in sociology from UW–Madison and a master’s degree in public policy and public administration from Northwestern University.

According to Pechacek’s biography on DOC’s website, she “has been involved in public policy development and acted in advisory roles for multiple practice areas associated with local and large-scale governmental administration, specializing in crisis management for compliance related damage mitigation and program recovery.”

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