State audit: Oregon Employment Department was already struggling—before the pandemic

By COLIN STAUB

The COVID-19 pandemic strained the Oregon Employment Department (OED), but it was already struggling, according to a recently published state audit. In response, OED leadership says several improvements are in progress or complete.

Secretary of State Shemia Fagan on July 27 released the audit, which found that OED struggled to respond in a timely manner to unemployment claims—even before COVID. The pandemic worsened response time so that some workers waited months, or even more than a year, to receive unemployment benefits.

Pandemic delays were common nationwide. Across all states, governments took an average of 38 days to make payments on Pandemic Unemployment Assistance claims. Oregon’s average was actually shorter, at 31 days. Still, the audit found Oregon’s response was hindered by inefficiencies, like conflicting and difficult-to-find information on the agency’s website, and outdated procedures for contacting claimants. Oregon adjudicators, who are tasked with evaluating unemployment claims, lacked consistent and accessible guidance to help them make decisions. Oregon’s system also suffered from “antiquated and rigid IT systems,” making it hard to correct data anomalies, the audit found.

The state received $85 million in federal money in 2009 to put toward the unemployment insurance system, and officials set aside most of that money to modernize the OED IT system. That project started in 2015 but won’t fully roll out until 2024. (Oregon is not alone in the lengthy upgrade – only 15 out of 39 states that received similar federal funding had completed IT system overhauls by early 2021, according to the audit.)

OED workers were unable to reprogram the IT system to handle Pandemic Unemployment Assistance claims, so they had to implement that program manually.

In a written response, OED Acting Director David Gerstenfeld agreed with the findings and described how the department has hired and trained hundreds of new workers since the pandemic started. Overall, he said many of the recommendations are in the works or complete.

The audit recommended that OED:

  • Ensure the IT system has features to reduce data errors, flag claims that haven’t been reviewed within a set timeframe, allow secure electronic communication options, and let claimants track claim progress.
  • Offer texting as an option for claimants to communicate about their claim status.
  • Remove outdated content from the unemployment website.
  • Consider creating a worker advocate office that would help guide claimants through the unemployment insurance process.

See the complete audit: sos.oregon.gov/audits/Documents/2022-21.pdf

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