In summary
From lost homes to mounting debt, workers from across the state share how they were impacted by payment delays, fraud panic and mass confusion about unemployment benefits.
Lose your job, file for unemployment, get a few hundred dollars a week from the state to pay for essentials while you find a new gig.
It sounds simple, in theory. But that’s far from the reality that many workers experienced when the state’s job safety net unraveled during the pandemic.
Five million people — about 1 in 8 Californians — got stuck waiting for delayed payments from the California Employment Development Department. More than 375,000 unemployment debit cards were cut off without warning. As few as 1 in 1,000 workers calling for help got through on jammed state phone lines.
In the 3½ years since COVID shutdown orders began, state audits, class-action lawsuits and unemployment experts have blamed the problems on different factors: crushing demand, outdated technology, inconsistent funding and unprecedented fraud, among others.
EDD officials say that change is coming with a new five-year, $1.2 billion effort to overhaul the department’s unemployment and disability systems. But the stakes are still high when something goes wrong, as it did for millions of people during the pandemic.
Here are some of their stories:
Danny Ramos
As California locked back down in late 2020, Danny Ramos needed an out.
On paper, the San Diego construction worker had more than $8,000 in his state unemployment account after losing a soundproofing job that summer. But, Ramos told a state appeals judge, he never received an EDD debit card to access the money.
“I just went into panic,” Ramos recalled. “Like, ‘How the hell am I going to pay for my apartment?’”
He packed up his place in Carlsbad and found a cheaper rental just across the Mexico border, in Tecate. His then-fiancé took the kids to stay with family in the Midwest — a split Ramos said he thought would be temporary.
But by the spring of 2022, Ramos was still living in Tecate and riding his motorcycle across the border each day to work near San Diego. And then he became one of hundreds of thousands of workers whose unresolved unemployment cases came back to haunt them.
Ramos was flagged for potential fraud after the EDD said he did not send in required identity documents, then was ordered to repay the benefits he never received. He’d never got the notices after he moved and only realized what was happening, Ramos told a judge, when the state garnished more than $2,200 from his tax refund.
He filed an appeal, spent $1,800 on a lawyer, then waited months for a hearing before the judge ruled in his favor this past August. In late October, paper checks finally started to arrive with the long-delayed money.
Other losses can’t be repaid. Ramos said his wedding was called off. He’s rebuilding his life alone.
“I’m just still trying to catch up to where I was,” he said. “And I don’t even know if I ever will.”
Donna Cook
As a longtime seasonal hospitality manager in Big Bear Lake, Donna Cook thought she understood how to file for unemployment with the EDD. But the pandemic brought a whole new level of stress, confusion and up to 4½-hour waits on the phone.
“They become the center of your life,” Cook said. “It’s always negative, and you’re already feeling down on yourself for being unemployed.”
The trouble for her started in mid-2021, when she said several payments for her pandemic unemployment claim came late. Then came a letter from the EDD ordering Cook to repay the agency for failing to report $61 of income. The agency wanted back $79, including a 30% penalty, despite Cook’s argument that she hadn’t meant to deceive anyone and received the extra money from an orientation that she did not know was paid.
The timing of the confusion, while she was caring for her terminally ill mother, was terrible. Cook pitched in for utilities but had to rely on her mom to buy groceries.
Like thousands of other workers who are penalized each year for even slight income miscalculations or clerical errors, the worst of it came the next time she had to file for unemployment.
Late this past summer, Cook lost another hospitality job, filed for benefits and was confused when she didn’t get any payments, leaving her in a familiar loop of dialing the EDD and getting a message that all agents were busy. This time, she was struggling to keep paying for the small house she’d just bought with the money she said her mom left when she died.
Finally, Cook got through in October to an agent who delivered the bad news: Under the EDD’s strict payment rules, she had to serve a five-week penalty for the previous overpayment, leaving her in limbo once again.
“I don’t know how they expect people to wait,” Cook said, “when you’re already living check to check.”
Maria and Maribel Sanchez
When Maria Sanchez got the letter telling her she owed the state more than $2,000, she thought she didn’t have any choice but to sign up for a payment plan she couldn’t afford.
“I would have paid that money to the EDD,” Sanchez said in Spanish, recalling “a lot of fear.”
Her daughter Maribel, however, had a different idea.
The law student had watched for months as her mom — a longtime San Francisco nanny who emigrated from El Salvador in 1976 — struggled to explain to the EDD, in Spanish, how she’d lost her job and spent months waiting for unemployment payments.
The last straw for Maribel was when court records show that her mom was accused of fraud and ordered to pay back some of the money for making a “false statement” in a language she doesn’t speak fluently.
“There was so much fraud going on with the EDD scams,” Maribel recalled. “I’m like, ‘You’re going to come after a 66-year-old lady that doesn’t have money to begin with?’”
In mid-2021, the family found a lawyer at advocacy group Legal Aid at Work to challenge the notice ordering her to pay back $1,750 in benefits, plus a $525 penalty. The following February, they filed a legal complaint in Superior Court arguing that the EDD’s fraud allegations were based off of a conversation in English that “contained obvious inaccuracies.”
It took multiple rounds of appeals and legal hearings, plus living on high-interest loans in the meantime, but a judge cleared Maria in 2022.
Still, Maribel can’t help but wonder, how many others weren’t so lucky?
Lauren Hepler is an investigative reporter for CalMatters, where she has covered issues including breakdowns in pandemic unemployment programs and shifting state demographics. Lauren was previously a staff… More by Lauren Hepler
