Unemployment Insurance: Millions in Benefits Overpaid to Military Reservists
HEHS-96-101
Published: Aug 05, 1996. Publicly Released: Aug 05, 1996.
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Highlights
Pursuant to a congressional request, GAO determined the amount of unemployment insurance (UI) paid to military reservists, focusing on: (1) why UI claimants do not report reserve income; (2) the administrative and legislative options available to prevent future trust fund losses; and (3) how these options will affect reservists' retention rates.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Defense | To better inform claimants of their reporting responsibilities, the Secretary of Defense should direct the four Defense Finance and Accounting Service (DFAS) centers to notify all reservists of their income-reporting responsibilities with respect to state UI benefits in a message included on their leave and earnings statement. |
Closed – Implemented
Action was taken in March 1997 with a message added to reservists leave and earnings statements. This action will be repeated on an annual basis thereafter.
|
| Department of Transportation | The Secretary of Transportation should direct the United States Coast Guard (USCG) Pay and Personnel Center to notify all reservists of their income-reporting responsibilities with respect to state UI benefits in a message on their leave and earnings statement. |
Closed – Implemented
A message, as described above, first appeared on leave and earnings statements in April 1997 and will reappear in October 1997. USCG plans to continue this action twice a year.
|
| Department of Labor | The Secretary of Labor should direct the Employment and Training Administration's UI Service to provide assistance and encourage state UI programs to review the administrative forms or procedures used to gather information about a prospective or continuing claimant's wages, making revisions as necessary to clearly identify to claimants the types of reserve income they must report for the offset of benefits. |
Closed – Implemented
Agency officials have provided assistance through correspondence.
|
| Department of Defense | The Secretary of Defense should direct the Defense Manpower Data Center (DMDC) and the four Defense Finance and Accounting Service (DFAS) centers to develop a process for giving states reserve personnel and payroll data in a timely, economical, and efficient manner. In doing so, they should coordinate with Labor's UI Service to identify states' needs. |
Closed – Not Implemented
DOD originally agreed with this recommendation and initiated discussions on what was involved to implement it. In 1999, DOD reported that it needed to minimize the burden of any reporting requirement and to ensure any action taken was cost-effective and commensurate with potential savings. It reported that, since last year, it had determined that: (1) 13 states effectively exempt reserve wages from any unemployment insurance payment offset; and (2) there would be significant costs associated with providing automated data on the earnings of part-time reservists. As a result, it did not intend to take any further action to respond to this recommendation. Although there may be costs associated with implementing this recommendation, the millions of dollars in overpayments discussed in the report excluded those states that did not offset unemployment insurance payments. As a result, it is incorrect for DOD to assume that the costs of implementing the recommendation would outweigh its dollar savings.
|
| Department of Transportation | The Secretary of Transportation should direct the USCG Pay and Personnel Center to develop a process for giving states Coast Guard reserve personnel and payroll data in a timely, economical, and efficient manner. In doing so, it should coordinate with DMDC and with Labor's UI Service to identify states' needs. |
Closed – Implemented
Agency officials are prepared to assist any state upon request. However, to date, no states have asked for this assistance.
|
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Topics
Financial management systemsMilitary payMilitary reserve personnelMilitary personnel retentionNoncomplianceOverpaymentsPayroll recordsReporting requirementsUnemployment compensation programsUnemployment insuranceUnemployment insurance benefits