LOUISVILLE, Ky. (WDRB) -- Kentucky was overwhelmed by record waves of unemployment claims during the COVID-19 pandemic as businesses were locked down to contain the virus's spread. Tens of thousands of Kentuckians found themselves in limbo for months as they waited for their jobless claims to be processed, delays that became a nagging political problem for Gov. Andy Beshear.
The Democratic governor accepted responsibility for the state's response but noted that budget and staffing cuts hobbled the unemployment insurance system before he took office in late 2019, just months before the global pandemic hit.
Kentucky still uses the same decades-old system in 2024, but the state agreed in May to a six-year, $55.5 million contract with Deloitte Consulting to replace the antiquated technology.
"This new system will help us better meet the needs of Kentuckians by improving accessibility and claims processing times, as well as safeguarding against potential unemployment insurance fraud," Beshear said in a news release earlier this year.
Around the time the contract was signed, Kentucky's unemployment rate for was 4.5%, compared to the national average of 3.7%. Louisville's unemployment rate was 4%.
The new system under Deloitte is being hailed as the savior of an antiquated process, and the state said it will implement safeguards to protect against what the current system has become. But the unemployment backlog continues, and delays remain a daily reality.
'Almost impossible'
Outside the Kentucky Career Center in downtown Louisville, a woman walked in recently to get help in-person. She didn't want to be identified but has been looking for a job for a month and hasn't received any unemployment.
"You have to have certain passwords to get into the computer," she said of the claims process. "It's kind of hard, and I'm not really a computer type of person. It's my third time coming up here."
There are many resources available at the Kentucky Career Center, including a job board with postings from local employers and several computers to file for unemployment and research jobs. But for those trying to get unemployment help on the phone, it's not so easy.
"It's almost impossible to get through," said Steven Robinson, who lives in Prospect. "I don't know if someone can get through. I was unable to. At this point, I don't have the time and I'm not going to jeopardize the job I have to try and rectify this."
After spending years as a project manager, Robinson was unemployed for October 2022 to April 2023. He's been working full-time ever since but got audited by the state under the claim that the unemployment insurance the government paid him for some of that time needed to be paid back. He's still trying to get it resolved.
Records show 1% of all unemployment claims are randomly selected to be audited. When Robinson calls the unemployment phone number, the recording says "We apologize, but we're currently experiencing a high call volume. All of our agents are currently assisting other customers."
In fact, Robinson said he's now been audited twice for the same unemployment claim. The first time, he said the state agreed he was eligible and he didn't have to pay back the money. The second time, he said he couldn't get into the virtual video hearing, missed his appeal and ended up paying the unemployment money back, which was about $500. However, even after he paid, he continued receiving letters from Frankfort saying he hadn't.
"(They) sent me a letter saying I hadn't paid them and they were sending it to the credit agency. So I packed up the receipt and packed it up with the letter and said 'This has been paid.'"
So why is it so hard to get someone on the phone? Of the 185 employees who work at the Division of Unemployment Insurance office in Frankfort, only 22 work in the call center handling about 400 calls per day. Earlier this year, the Kentucky General Assembly didn't fund a request to hire more workers.
And with about 7,900 active unemployment claims statewide, it can take eight to 12 weeks just to get an unemployment claim approved and even longer to get a check in the mail. The Kentucky Education and Labor Cabinet said there have been more than 62,000 claims filed so far in 2024.
"The limitations of the outdated system were compounded by the previous administration's 2017 closure of more than 30 of the state's 51 regional career centers, which provided job training and in-person assistance for unemployment insurance claimants," the cabinet said in a written statement. "Additionally, the previous administration removed in-person unemployment services from the remaining career centers, forcing people to drive longer distances to the few remaining regional offices or to contact the Frankfort call center, which had only 12 employees at the onset of the pandemic.
"Additional staff reductions and budget cuts implemented prior to the Beshear administration also reduced UI staff by 95 employees and cut the budget for the Office of Unemployment Insurance by $16 million. These cuts, coupled with an unprecedented 1,300% increase in UI claims due to the once-a-century global pandemic, meant that many Kentuckians experienced significant delays in receiving UI benefit payments."
While it won't be fully functional until 2028, Beshear said the new system will also safeguard against potential unemployment fraud. The state said the new platform under Deloitte Consulting will actually be a mix of three systems that support employer contributions, benefits and appeals, each with its own customer-facing and internal staff component and thousands of specific system requirements based on federal and state laws. The state's contract with Deloitte includes incremental system deliverables, training, organizational change management and data migration to allow for the final sunsetting of the old legacy system.
Robinson and others just hope changes will come sooner than 2028 and would like to see several changes.
"Have somebody on the phone. Have a way to get back to you," he said. "I work full time so I can't stay on the phone. For the first few hours, they generally tell you 'We're busy,' then the system hangs up on you. If you spam it — dial it over and over again — sometimes you'll get on hold for 10-15 minutes. Then the system will hang up on you."
The state's six-year contract with Deloitte to develop the replacement system is for $55.5 million, cabinet spokeswoman Jill Midkiff said. The cost of the new system, including ongoing operations and maintenance expenses, will be supported by $85 million in funding approved by lawmakers, she said.
Kentucky still uses the same decades-old system in 2024, but the state agreed in May to a six-year, $55.5 million contract with Deloitte Consulting to replace the antiquated technology.
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Copyright 2024 WDRB Media. All Rights Reserved. The Associated Press contributed to this report.