SACRAMENTO (CBS SF) — The State of California has begun the process of revamping the embattled system used by the Employment Development Department to process unemployment claims, following months of trying to resolve missing claims, investigate fraud, and tackle a huge backlog of cases.

During his noon press conference Monday, Governor Gavin Newsom announced that an EDD “strike team” report issued a number of recommendations on Saturday that are already starting to be implemented. The recommendations include the launching of new ID verification software, redeploying experienced staffers to process the most complex claims, and add new staff to focus on outreach to UI applicants who are mired in the backlog.

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The revamping includes a two-week reset period where no new claims will be processed so the EDD can expedite new claimant payments, reduce instances of fraud and tackle the backlog of cases which is now nearing 600,000 as of last week.

Newsom noted that many of the problems facing the EDD are rooted not only in the flood of claims coming from the coronavirus pandemic, but also the decades-old Cobalt system the agency uses that he says needs to be “strewn to the wastebin of history.” In addition to dealing with outdated technology in the processing of a historic number of claims, Newsom said the EDD is also trying to determine how many of the 7.7 million claims filed in 2020 are fraudulent.

“We are adjudicating fraud. We’ve had fraud schemes all across the United States of America, disproportionately hitting states that have no income taxes for various reasons that become very obvious on the verification side when you consider [them]” said Newsom. “We are not immune from those fraud efforts and we are making real progress to weed them out and hold individuals and organized groups accountable.”

Part of the new ID verification system will require UI applicants to submit a selfie as part of the process, which was paused for two weeks to allow for the software to be implemented.

“We went through about 16 or so vendors looking at what was available out there and went down to about 12 where we tested and kicked the proverbial tires,” explained Newsom. “And we’ve come up with a system called ‘ID Me.’ This will process about 90 percent automatically all of the new applications. You’ll have requirements under this automated system to do selfies and provide additional verification in ways that we think could substantially — not exclusively, no one is naive — but substantially mitigate fraud.”

Secretary of the Government Operations Agency Yolanda Richardson co-chaired the EDD strike team and said Monday the goal was to bring a fresh perspective on its operations and build a faster and better experience for the hundreds of thousands of claimants across the state. The strike team came up with some 70 recommendations with the main goals of preventing any growth to the backlog, reducing the backlog, and making the process easier and simpler.

“We believe that if EDD embraces our recommendations, they will be well on their path to creating a first-class user experience, minimizing processing delays, being able to open the mail, being able to answer calls, and so we really appreciate again their embracement of our recommendations,” said Richardson.

EDD Director Sharon Hilliard predicted the backlog of claims would take until January 2020 to resolve even with the implementation of task force recommendations.

“For the backlog that we are experiencing right now, we predict between now and the end of January it will be completed. But we’re making huge progress each and every day,” said Hilliard. “It doesn’t mean that in January that’s what people have to wait. We will be clearing backlog every single day between now and January, and it’s just allowed us the ability to really focus, as well as additional tools the strike team brought, will allow us to implement a very good way to manage our resources to make sure we’re focused on the backlog and we have the right people addressing everything at the right time.”

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Last month, Hilliard testified to lawmakers that the EDD was not answering nearly two-thirds of the calls it received for help as workers struggled through the backlog, and that the agency was not prepared to handle the unprecedented surge in claims prompted by the coronavirus.

Charles Nolan of San Jose is one of the countless Californians dealing with their own problems with EDD.  When KPIX 5 Juliette Goodrich asked him if he thought the reset will work he quickly responded, “No.”

“I didn’t have two weeks, two weeks ago!” he exclaimed. “I’ve been waiting for a check since March.”

Linda Margolin’s hours were cut as a consultant with Travel Advisors of Los Gatos during the pandemic.

“It’s been the worst possible experience ever, and it plays a toll on one’s health, creates a lot of anxiety and high blood pressure,” said Margolin.

That’s because she has only received three EDD payments since May. She says she is owed $12,000 in unemployment insurance.

“Even our office manager, there’s a special number for her to call, she can’t get through, because she’s been trying to find out what’s been going on,” she said.

Assemblymember David Chiu (D-San Francisco) is on a subcommittee to reform EDD and said, “I’m worried that it is going to be too late for so many Californians who are living on the edge, depleting their life savings, going into debt, having trouble to put food on the table while waiting for these recommendations to get implemented.“


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