Wyoming Appeals for Unemployment Insurance Compensation

5/29/2013Research Memo13 RM 012Date: May 29, 2013Author: Michael Swank, Senior Research AnalystRe:Wyoming Appeals for Unemployment Insurance CompensationQUESTIONS1. How many claims are appealed beyond the initial approval/denial decision and how longdoes it take to complete the claims appeals process?2. How does Wyoming compare to other states regarding the timeliness of appealed cases?ANSWERS1. The Unemployment Insurance (UI) compensation program is administered by the Wyoming Departmentof Workforce Services (DWS) to provide income compensation to qualified former employees. The UIprogram is administered according to the Wyoming Employment Security Act under Title 27 ofWyoming Statutes. The program is intended to provide a bridge of income and support to unemployedworkers who become unemployed through no fault of their own. The program is federally authorizedand monitored by the U.S. Department of Labor, Employment and Training Administration, which setsstandards and performance measures to rate the effectiveness of each state's program administration.See Attachment A for a flowchart of the UI claims and appeals process.Table 1, next page, summarizes the number of UI claims initiated in the state during the last three fiscalyears (FY 2011, 2012, and 2013 through March 31, 2013) along with the number of claims reachingcertain decision points (i.e. – approval, denial, etc.). Based on the information in the table, the DWS hasapproved approximately 70 percent of all initiated UI claims; the DWS has dismissed and deniedapproximately 13 percent and 16 percent, respectively.WYOMING LEGISLATIVE SERVICE OFFICE • 213 State Capitol • Cheyenne, Wyoming 82002TELEPHONE (307) 777-7881 • FAX (307) 777-5466 • EMAIL • lso@wyoleg.gov • WEBSITE http://legisweb.state.wy.us

PAGE 2 OF 7Table 1. Initiated, Approved, Denied, and Dismissed Wyoming Unemployment Insurance Claims, FY 2011– 2013 (through March 31, 2013).Claims - Decisions FY 2011 FY 2012FY 2013 (as ofMarch 31, 2013)All FiscalYearsTotal Claims Initiated 43,298 33,858 25,735 102,891Total Claims Completed for Decision 36,743 29,578 22,833 89,154Total Claims dismissed (lack of completeinformation/application)6,555 4,280 2,902 13,737Completed Claims - Initially Approved 29,069 24,455 18,985 72,509Completed Claims - Initially Denied 7,674 5,123 3,848 16,645Total Claims Initially Approved, but laterdenied 1 318 302 226 846Source: LSO Research summary of Wyoming Department of Workforce Services information.1 When UI claims are approved, payment to the claimant is started promptly. The DWS states that generally over 70 percentof claims are approved and initial payment begins within fourteen (14) days; over 90 percent are approved and beginpayment within twenty-eight (28) days. If a claim is later moved to denial status, then the claimant may be liable for all orpartial repayment of disbursed benefits.When a UI claims decision is contested by the claimant or employer, the individual may request a redeterminationof the claim by DWS and then subsequently has fifteen (15) days from the final determinationnotice to appeal the ruling to administrative hearing if the individual still wishes to contest the determination.If claims are appealed further, the sequential appeal steps continue to the Unemployment InsuranceCommission (UIC), District Court, and the Wyoming Supreme Court.Table 2, next page, provides a summary of the last three fiscal years' appealed UI cases through the differentappeals steps and the resulting decisions of those cases; it includes how many cases are pending at each stage aswell. According to the table, the vast majority of appealed cases only get as far as the administrative hearingsprocess (88 percent), while less than one percent are appealed on to the courts. The subsequent table, Table 3,provides a summary of how long it takes for appealed UI cases to make it to final decision though the variousappeal steps from the date the claim was initiated. According to the DWS data, the average and mediannumber of days from claims initiation to reach final decision through administrative hearings and theUnemployment Insurance Commission have gone down during the last three fiscal years.WYOMING LEGISLATIVE SERVICE OFFICE • 213 State Capitol • Cheyenne, Wyoming 82002TELEPHONE (307) 777-7881 • FAX (307) 777-5466 • EMAIL • lso@wyoleg.gov • WEBSITE http://legisweb.state.wy.us

PAGE 3 OF 7Table 2. Number of Wyoming Unemployment Insurance Claims Appealed Cases, by Pending or FinalDecision, FY 2011 – 2013 (through March 31, 2013). 1Claims Decisions FY 2011 FY 2012FY 2013(as of March31, 2013)All FiscalYearsCases Appealed for Administrative Hearing 2,208 1,977 1,647 5,832Hearing Affirmed DWS Decision 1,557 1,404 1,144 4,105Hearing Reversed DWS Decision 639 573 503 1,715Claims pending for final hearing decision 264 190 147 601Denied Cases Appealed for Unemployment InsuranceCommission Hearing283 234 234 751Hearing Affirmed Administrative Hearing Decision 225 215 202 642Hearing Reversed Administrative Hearing Decision 21 21 14 56Claims pending for final hearing decision 50 34 32 116Denied Cases Appealed for District Court Hearing 13 10 5 28Hearing Affirmed UIC Decision 7 7 5 19Hearing Reversed UIC Decision 1 3 1 5Claims pending for final hearing decision 10 10 9 29Denied Cases Appealed for Supreme Court Hearing 0 2 1 3Hearing Affirmed District Court Decision 0 1 1 2Hearing Reversed District Court Decision 0 0 0 0Claims pending for final hearing decision 0 2 1 3Source: LSO Research summary of Wyoming Department of Workforce Services information.1 The statistics given are for cases that were processed and/or completed during the fiscal year, but may have been originated inprior years.WYOMING LEGISLATIVE SERVICE OFFICE • 213 State Capitol • Cheyenne, Wyoming 82002TELEPHONE (307) 777-7881 • FAX (307) 777-5466 • EMAIL • lso@wyoleg.gov • WEBSITE http://legisweb.state.wy.us

PAGE 4 OF 7Table 3. Elapsed Time from Claims Initiation Date for Contested Unemployment Insurance CompensationCases Through Each Appeal Step, FY 2011 – 2013 (through March 31, 2013). 1Appeal StepAdministrative HearingUnemployment InsuranceCommissionDistrict CourtFY AverageDaysMedianDaysMinimumDaysMaximumDays2011 46 29 7 4802012 31 21 7 6902013 24 22 6 2062011 92 81 36 2952012 78 70 31 9372013 78 71 42 9462011 225 122 76 5712012 186 127 33 5532013 513 570 159 685Wyoming Supreme Court 2 2012 N/A N/A 140 6662011 N/A N/A N/A N/A2013 N/A N/A 876 906Source: LSO Research summary of Wyoming Department of Workforce Services information.1 The statistics given are for cases that were processed and/or completed during the fiscal year, but may have been originated inprior years. Also, the average and median days are calculated using a weighted average between the number of days for casesdecided in the claimants' favor and the number of days for cases decided in the DWS' favor.2 Average and median statistics were not calculated for Wyoming Supreme Court cases due to the small number of cases whichreach this appeal step.2. Since the UI program administration is heavily dependent on federal standards, the state records andanalyzes its claims process, including appeals, based on uniform federal performance benchmarks. DWSreports on federal performance benchmarks for claims processing including quality and timeliness ofappealed cases. These measures may differ slightly from the preceding information due to the strict datagathering processes and definitions used by the federal government. The most direct benchmarksrelated to appealed case include the following:Age of Pending Lower Authority Appeals (Table 4, next page): The number of days from the date of claimsfiling for cases pending a lower authority appeals decision;Age of Pending Higher Authority Appeals (Table 5, next page): The number of days from the date ofclaims filing for cases pending a lower authority appeals decision;Lower Authority Appeals Quality (Table 6, page 6): The percent of lower authority appeals with qualityscores equal to or greater than 85 points – based on a sample of cases conducted quarterly;Lower Authority Appeals Time Lapse: The number of days from the date a claim's lower authority appeal isfiled to the date the appeal decision is rendered; andHigher Authority Appeals Time Lapse: The number of days from the date a claim's higher authority appealis filed to the date the appeal decision is rendered;WYOMING LEGISLATIVE SERVICE OFFICE • 213 State Capitol • Cheyenne, Wyoming 82002TELEPHONE (307) 777-7881 • FAX (307) 777-5466 • EMAIL • lso@wyoleg.gov • WEBSITE http://legisweb.state.wy.us

PAGE 5 OF 7Using U.S. Department of Labor data (as reported by each state), Tables 4 through 6 on the following pages,compare Wyoming's UI appeals quality and average age performance against the following surrounding andwestern states: Idaho, Montana, Colorado, Utah, North Dakota, South Dakota, Nebraska, Nevada, and NewMexico. Each table is sorted alphabetically and Table 4 and Table 5 provide high-lights on the best performing(green) and worst performing (red) states of those states shown in the tables. Federal statistics for appeals timelapse were not provided due to the DWS original data report under #1 above.Table 4. Wyoming and Other States' Average Age of Lower Authority Appeals,FY 2009 – 2013 (through March 31, 2013).State FY 2009 FY 2010 FY 2011 FY 2012 FY 2013Colorado 27.0 22.0 24.0 23.0 20.0Idaho 23.0 13.0 11.0 14.0 13.0Montana 18.5 16.9 9.4 23.5 12.9Nebraska 24.0 21.0 11.5 12.4 13.2Nevada 67.0 46.0 27.0 28.0 24.0New Mexico 31.9 81.2 44.8 43.9 24.7North Dakota 11.3 29.6 8.5 37.3 24.3South Dakota 20.0 25.0 13.0 12.0 13.0Utah 12.7 6.9 8.0 7.5 8.7Wyoming 55.5 63.9 91 28.6 24.3U.S. 49.1 52.4 37.4 31.8 37.1Source: LSO Research summary of U.S. Department of Labor, Employment and Training Administration data.Table 5. Wyoming and Other States' Average Age of Higher Authority Appeals,FY 2009 – 2013 (through March 31, 2013).State FY 2009 FY 2010 FY 2011 FY 2012 FY 2013Colorado 29.0 20.0 21.0 27.0 21.3Idaho 35.0 37.0 46.0 43.0 37.0Montana 35.6 26.8 23.7 20.6 30.2Nebraska1 1 1 1 1Nevada 52.0 37.0 43.0 26.0 22.0New Mexico 17.2 11.1 42.9 27.1 49.0North Dakota 5.6 14.4 8.5 34.0 13.3South Dakota 24.0 19.0 9.0 5.0 4.0Utah 20.9 13.8 13.1 11.0 12.9Wyoming 12.5 17.1 32.8 29.5 31.7U.S. 47.7 85.6 95.8 65.1 51.0Source: LSO Research summary of U.S. Department of Labor, Employment and Training Administration data.1 Nebraska did not submit the reports needed to calculate this measure.WYOMING LEGISLATIVE SERVICE OFFICE • 213 State Capitol • Cheyenne, Wyoming 82002TELEPHONE (307) 777-7881 • FAX (307) 777-5466 • EMAIL • lso@wyoleg.gov • WEBSITE http://legisweb.state.wy.us

PAGE 6 OF 7Most of these states, including Wyoming, perform better than the national average on these measures. However,more specifically to Table 4, the data does show that Wyoming, New Mexico, and Nevada tend have higheraverage age of lower authority appeals than the other selected states. In Table 5, it shows that Nevada, Idaho, andNew Mexico tend to have higher average age of higher authority appeals. Utah and North Dakota generally havethe best performance, with a few exceptions, on both of these measures. Finally, related to Table 6, all selectedstates tend to have better performance on appeals case quality than the national average except for Nevada.Table 6. Wyoming and Other States' Lower Authority Appeals Quality (percent of cases scoring 85points or higher), FY 2009 – 2013 (through March 31, 2013).State FY 2009 FY 2010 FY 2011 FY 2012 FY 2013Colorado 100.0 100.0 97.5 100.0 100.0Idaho 97.1 100.0 93.8 100.0 95.0 1Montana 98.7 98.7 97.5 100.0 94.6 1Nebraska 100.0 100.0 98.8 100.0 100.0 1Nevada 88.8 78.5 87.2 81.0 82.1 1New Mexico 96.2 92.2 98.7 97.5 97.5 1North Dakota 100.0 100.0 100.0 98.7 100.0 1South Dakota 97.4 100.0 98.7 94.3 100.0Utah 100.0 98.7 97.5 97.5 98.3Wyoming 100.0 100.0 98.7 100.0 100.0 1U.S. 95.8 94.9 95.5 96.0 95.8Source: LSO Research summary of U.S. Department of Labor, Employment and Training Administration data.1 Numbers for FY 2013 are estimated based on reports submitted thus far by selected states.Lastly, LSO should note that the Wyoming UI program went through a comprehensive performance evaluationin 2010 (report issued December 15, 2010). The evaluation issued several findings related to the claimsappeals process:Finding 2.1: Once the UI claim is received by the UID [Unemployment Insurance Division], complicatedmanual processes contribute to the backlog of claims in times of high claims-filing volume, which impactstimeliness and quality of claims decisions.oRecommendation: The UID [Unemployment Insurance Division] should transfer theadministrative functions, including scheduling of hearings currently performed by the ChiefHearing Officer to section clerical staff. The Chief Hearing Officer should be scheduled to conducthearings, particularly in times of increased workload.Finding2.3: Appeals section hearing officer's appellant notice and response practices contributesignificantly to hearing no-shows, which wastes staff effort to prepare and schedule cases.ooRecommendation: The Commission [UIC] should require hearing officers to call appellants at thebeginning of hearings with the most current contact information from the appealing parties.Recommendation: The UID [Unemployment Insurance Division] should look into providing asupplement to the Claimant Handbook that provides extensive and thorough information on theWYOMING LEGISLATIVE SERVICE OFFICE • 213 State Capitol • Cheyenne, Wyoming 82002TELEPHONE (307) 777-7881 • FAX (307) 777-5466 • EMAIL • lso@wyoleg.gov • WEBSITE http://legisweb.state.wy.us

PAGE 7 OF 7appeals process, particularly with respect to how hearings are conducted and how appealing partiesmust comply with hearing requirements.Finding3.2: Training of claims taking, adjudication, and appeals staff is insufficient to ensure consistencythroughout claims-appeals processing.ooRecommendation: The UID [Unemployment Insurance Division] should develop a minimum andstandard training curriculum for new staff hires in each of its sections, particularly for staff in theclaims center and appeals sections. UID supervisors should be instructed to evaluate staff duringtheir probationary period based on the specific skill-set established by these written standards.Recommendation: The UID [Unemployment Insurance Division] should develop refreshertraining for long-term staff and revisit its training curriculum periodically to formally incorporateor eliminate emergency changes as implemented through its e-mail staff notification process.The DWS issued a follow-up report to the original evaluation in December 2012 in which it detailed thefollowing actions taken related to the original findings and recommendations:Finding 2.1 and Related Recommendation: The DWS hired additional staff (hearings officer andadministrative assistant) and reorganized the business office to gain efficiency in processing appeals. Allscheduling duties are performed by the Business Manager and the unit has developed a plan for priorities ofemployer chargeability and tax issues which tend to get backlogged due to claims cases due to federaltimeliness standards.Finding 2.3 and Related Recommendations: Changes to data tracking and appellant notice requirementsare being included in the new data system being constructed for the DWS. The DWS also conducted afocus group of UI claimants to gather feedback on the Claimant Handbook. With this feedback, the DWSexpanded information in the handbook concerning the basics of the appeals process and provides directionto an online video that gives a step-by-step process of how to prepare for appeals hearings.Finding 3.2 and Related Recommendations: A partnership with the Wyoming Distance Learning Centerwas established to develop curriculum for the Quality Assurance Team (though the partnership has beeninterrupted by funding issues). By having these individuals work collaboratively across divisions anddeveloping an online curriculum, training issues were identified and addressed. Currently, an internaltraining team has been formed to take on curriculum development. The DWS is in the process ofreplicating a leading curriculum program from another state, including observing a "best practice" state,Utah. Along with a department-wide leadership team with regularly scheduled meetings, the DWS placespolicies on the agency’s internal website for feedback from employees as well as through a ten daycomment period/process. Other DWS changes include: 1) the UI Tax unit continuously holds internalcross-training of all staff; 2) each new hearing officer must conclude a two week training on administrativelaw fair hearings at the National Judicial College; and 3)an annual cross-training program was implementedin order to train benefits staff members in each area outside of their unit. Also, the UI benefits unit is in theprocess of building electronic binders with information on emergency changes and procedures.If you need anything further, please contact LSO Research at 777-7881.WYOMING LEGISLATIVE SERVICE OFFICE • 213 State Capitol • Cheyenne, Wyoming 82002TELEPHONE (307) 777-7881 • FAX (307) 777-5466 • EMAIL • lso@wyoleg.gov • WEBSITE http://legisweb.state.wy.us

Attachment AWyoming Unemployment Insurance CompensationClaims and Appeals Process FlowchartsSource: Wyoming Department of Workforce Services.Wyoming Unemployment Insurance Compensation Claims and Appeals ProcessInitial ClaimFirst Payment made on 3rd weekafter claim's effective date *No IssuesIssues SetAdjudicationallows all issuesFirst Payment made on 3rd weekafter claim's effective date, or nextoutput day *Adjudication DeniedAppeal hearingClaimant protestdenialClaimant doesnot protest, nobenefits paidEmployerprotestsAppeal hearingAffirmed Reversal Affirmed ReversalNo payment made for disqualifedweeksBenefits Denied Benefits paid * Benefits paid * Benefits DeniedClaimantprotest toCommissionEmployer protestto CommissionEmployer protestto CommissionClaimantprotest toCommissionClaimant goes into overpaymentfor weeks paid.Commission HearingCommission HearingRemanded back to Lower Level Affirmed Reversal Affirmed Reversal Remanded back to Lower LevelDistrict CourtDistrict CourtRemanded back to Lower Level Affirmed Reversal Affirmed Reversal Remanded back to Lower LevelWyoming Supreme CourtWyoming Supreme CourtRemanded back to Lower Level Affirmed Reversal Affirmed Reversal Remanded back to Lower Level