PA Department Of Labor & Industry Staff Shortage Compounds Fraud Problems


By Anthony Hennen | The Center Square

The PA Department of Labor and Industry building in Harrisburg.
Credit: Jelani Splawn/Spotlight PA

The Pennsylvania Department of Labor and Industry is walking a tightrope: Detecting and preventing fraud in unemployment claims while operating with a staff shortage.

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At a Senate Appropriations Committee hearing, Labor and Industry Secretary Jennifer Berrier emphasized that federal funds have helped clear unemployment claims backlogs, but low staff pay has made employee retention difficult.

โ€œThe majority of fraud that happened was when the new federal programs rolled out,โ€ Berrier said. โ€œThis money that we were pushing out the door as quickly as possible became extremely attractive to fraudsters โ€“ domestic and international fraudsters.โ€

That pattern was repeated nationwide. The U.S. Department of Justice has uncovered $8 billion in coronavirus aid fraud, which could be an underestimate.

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โ€œPennsylvania has definitely been hit with its fair share of fraud,โ€ Berrier said. โ€œI will equate to how weโ€™ve responded to it as playing the hardest game of whack-a-mole that Iโ€™ve ever played in my life.โ€

In response, the department has added more levels of security, such as using ID.me to verify identity and multi-factor authentication, to stop identity theft. The tradeoff has been risking some levels of fraud to send out relief faster to affected Pennsylvanians.

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โ€œThe main priority was paying off benefits to those entitled to receive them,โ€ Berrier said. โ€œBut our next priority was making sure we were addressing the fraud that we saw occurring.โ€

Sen. Wayne Langerholc, R-Clearfield, asked Berrier to rate the departmentโ€™s handling of unemployment compensation claims and its handling of fraud; she rated the department a 6 or 7, saying they had not been perfect, and for dealing with fraud, she gave it a 5.

Berrier was mainly concerned about staffing shortages. In 2009 during the Great Recession, she noted, the department processed 900,000 unemployment claims. In the last two years, the department processed 6 million claims โ€“ with half the staff. 

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Processing claims and detecting fraud has, as a result, slowed down in recent years and the department struggles to keep up when demand spikes.

โ€œOur main problem I think has been staffing. Recruiting staff and retaining staff at a 50% turnover rate, at the rate weโ€™re bringing on board additional staff โ€“ weโ€™re having a really hard time keeping up,โ€ Berrier said.

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To attract and keep more workers, the department is in discussion with the Department of Administration about the possibility of reclassifying positions to boost pay levels.

For Berrier, the departmentโ€™s issues come down to a need for more workers. โ€œPeople are constantly looking for ways to manipulate our system,โ€ she said.

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