South Carolina Work Force Agency: The Disaster Continues

Latest overpayment allegations could prove costly …

In digesting the latest depressing data to come from South Carolina’s much-maligned workforce agency, we were reminded of our news outlet’s historical coverage of this embattled bureaucracy – which has been an unmitigated dumpster fire for the better part of the past decade.

Actually, that is an insult to dumpster fires …

The S.C. Department of Employment and Workforce (SCDEW) has been a veritable “conflagration cornucopia” since 2011 under the “leadership” of former governor Nikki Haley and her successor, Henry McMaster, both “Republicans.”

Haley’s first choice to lead this agency was Abraham Turner, a retired U.S. Army general who stepped down shortly after our news outlet exclusively reported that SCDEW had doled out $54.5 million in “improper claims” to unemployment benefit recipients.

Haley next turned to Cheryl Stanton, who didn’t fare much better in this role. Three years ago, we exclusively reported on major problems with a controversial multi-state benefits system pushed by her administration – issues which were apparently never fixed.  This $100 million program – dubbed the Southeast Consortium Unemployment Insurance Benefits Initiative (SCUBI) – was allegedly “pushed to go” before it was ready.

Things got so bad three years ago that several of the states originally tapped for the federally funded partnership pulled out … leaving South Carolina as one of the only states participating in the glitch-prone system.

SCUBI has gone from bad to worse in the aftermath of the coronavirus pandemic, with its latest (greatest?) “crash and burn” forcing SCDEW to invest heavily in a massive expansion of its call center – the very layer of bureaucracy the online system was supposed to eliminate.

(Click to view)

(Via: Getty Images)

“To say this boondoggle crashed and burned in response to the influx of coronavirus-related claims is putting it politely,” we noted four weeks ago.

In one of our recent reports about the ongoing employment debacle in the Palmetto State, we noted that we were “investigating allegations that SCDEW has been doling out benefits to certain claimants well in excess of the amounts they applied for … raising additional questions as to the functionality of the state’s unemployment insurance system.”

Late last month, we were contacted by a teacher at a government-run school along the South Carolina coast. Like many teachers who don’t get paid what they deserve from the Palmetto State’s top-heavy, bloated bureaucracy, this teacher works as a part-time waitress to make ends meet.

In March, she was laid off from just such a part-time waitressing position along the Palmetto State’s Grand Strand. Given the loss of income she had been counting on, the teacher decided to find out if she was eligible for part-time unemployment benefits associated with her waitressing job.

“Every time I called I got a different answer,” she told us. “One person said I was eligible, the next person said I was ineligible.”

Tired of waiting up to four hours on the phone each time she called SCDEW only to get the run-around, the teacher finally decided to take her chances and file a claim based on her lost waitressing wages.

“Based on what I submitted to them I was expecting to get maybe $114 a week for a few weeks until my restaurant reopened,” she told us.

Not long thereafter, the teacher received a deposit in her bank account from the state unemployment office in the amount of approximately $1,500well above the lost wages she had claimed. A few days later, another deposit in the amount of roughly $700 landed in her account.

Another teacher who works on the Strand related a similar experience to us. The second teacher’s situation involved slightly lower amounts of money – but the payments she got from the state were still well in excess of what she had applied for (and what believed she was entitled to receive).

Most people would have just pocketed this money … but to their credit, both of these teachers tried to do the right thing.

All told, the first teacher spent more than twelve hours on the phone with SCDEW trying to return the portion of the money she did not believe she was entitled to receive.

“Calling them got me nowhere,” she told us.

(Click to view)

(Via: Getty Images)

“I’m trying to do the right thing.” the teacher added. “The money is still sitting in my account because it’s not my money.”

Rather than continue drawing benefits they did not believe they were entitled to receive, both teachers stopped claiming unemployment.

“I just stopped claiming because I didn’t want to take money that wasn’t mine,” the first teacher told us. “I got $2,200 in two payments and I can’t figure out how I got that much money.”

This news outlet reached out to both teachers prior to publishing this report and confirmed the money is still sitting in their bank accounts – waiting for SCDEW to adjust the payment amounts.

Several other sources we spoke with reported receiving unemployment overpayments from the state, but they declined to specify the amounts involved. Also, few of them expressed any interest in trying to return the money to the state.

“I’m not saying ‘finders, keepers’ but I don’t know when I am going to be back at work again,” one Columbia, S.C.-area part-time retail worker told us.

Meanwhile, another source who did inquire about returning the money expressed concern about doing so after a SCDEW representative told them they would be required to send back not only the cash they received but also any taxes owed on the benefit.

Wait … unemployment benefits are taxed? Yes.

Not only that, SCDEW does not automatically withhold the 10 percent federal levy and the seven percent state levy that is applied to these payments.

“When filing your initial claim, you must choose to have federal and state taxes withheld from your weekly payment; otherwise (SC)DEW will not withhold them,” the agency noted on its website.

What a mess …

With more than $1.35 billion in benefits paid out between March 15, 2020 and May 19, 2020, the potential for error, fraud and waste here is tremendous. Count on this news outlet to continue monitoring the situation and reporting back to our readers on what we are able to uncover …




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