Five months into the COVID-19 pandemic, tens of thousands of Hawaii’s jobless remain trapped in unemployment insurance limbo, many of them desperately awaiting back payments from a bureaucratic system that still can’t handle the demand.

The state Department of Labor and Industrial Relations has yet to resolve more than 10,000 regular unemployment insurance claims, including cases dating back to March. It’s also accrued a backlog of more than 22,000 claims in the separate Pandemic Unemployment Assistance program, or PUA, according to agency spokesman Bill Kuntsman.

“I understand that they have an ancient mainframe,” said one local claimant, Lelaine Lau. “But … it kind of is incredulous to me that there’s not more of a sense of urgency to fix this.”

The Oahu-based film and television worker said last week that she’d only received unemployment insurance payments one week out of the past four months.

“Sixteen weeks is crazy,” Lau said.

Unemployment Insurance office located at the Princess Ruth Keelikolani Building . DLIR
Five months into the pandemic, the Department of Labor and Industrial Relations is still facing a backlog of thousands of claims despite having paid out $2.5 billion on more than 160,000 claims. Cory Lum/Civil Beat/2020

Since absorbing the pandemic’s initial wave of claims, DLIR has taken steps to boost its operations. It’s nearly doubled its number of claims examiners to 50 from 26, Kunstman said.

The department also recently began recruiting 30 more examiners to specifically handle PUA claims. But it’s not clear when those reinforcements will arrive.

“It takes a while to get efficient,” Kunstman said of the incoming personnel. “You have to learn the law and the federal rules” for two separate systems now.

“You can’t ramp up overnight on unemployment insurance,” he added. “We are doing it, but it’s not an overnight solution.”

Lau said she’s managed to stay afloat in part by not paying rent since May. She said her own claim stalled after she lost her normal gig in the pandemic, then briefly worked as a delivery driver for Bite Squad but left that work largely because she was unable to afford car repairs.

“There’s still a lot of people that have old claims that need to be resolved,” said Peter Yee, a volunteer moderator at Hawaii Unemployment Updates and Support Group. The popular Facebook page is seeing a new wave of members, up from about 12,000 members in June to nearly 18,000 currently.

“These people are starving” and facing eviction, Yee said.

With its heavy reliance on tourism, Hawaii saw one of the nation’s most dramatic spikes in unemployment when the economic crisis hit earlier this year.

But the state’s new jobless were further hurt by a slow and clunky unemployment benefits system ill-suited to help them, especially because so much of the islands’ workforce relies on multiple jobs to get by, state officials and claimants say.

Their work histories often include stints as both independent contractors and full-fledged employees. The mix often complicates claims and flags them for review, stalling unemployment payments, officials said.

DLIR has also been grappling with widespread fraudulent claims, particularly within PUA — so much so that it recently started requiring all applicants there to submit a “selfie” photo while holding their official identification and Social Security cards. That added verification has slowed payments even more.

Meanwhile, the $600 added weekly benefit ended last week with no replacement in sight as Republicans and Democrats in Congress remain deadlocked.

To complicate matters even more, Hawaii DLIR Director Scott Murakami has been on leave since June 1. A spokeswoman for Gov. David Ige’s office said Monday that they still don’t know when he’s scheduled to return.

“There’s been a dearth of leadership,” Lau said. “We want to feel that we’re being seen and heard and our concerns matter. There’s such a disconnect. It tears me up.”

Unable To Get Through

Being seen and heard is getting harder, even though the state’s number of new claims has dropped and DLIR has paid out a reported $2.5 billion on more than 160,000 claims.

Those unfortunate enough to hit a snag on their claims continue to face lengthy waits for updates from DLIR on what’s happening.

Last week, the department rerouted calls from its customer service phone bank at the Hawaii Convention Center to its local offices because most of the state volunteers who were manning them have returned to their original jobs, Kunstman said.

“It’s a prison sentence if you have a problem. That means you have to wait weeks,” Yee said.

Some applicants use auto-dial software to try and get through, which further clogs the phone lines.

“There’s no contacting them. It was my eight-hour-a-day job, calling them,” said claimant Tina Ah Puck. The Maui resident said she had to wait more than four months before her unemployment claim was finally resolved and paid out in late July.

Many of the state employee volunteers who were helping DLIR have returned to their original jobs, so calls from claimants looking for an update are being routed back to DLIR’s local offices. Courtesy: DLIR

The volunteers weren’t able to provide much information anyway, department officials and claimants said. DLIR employees at the local offices will be even harder to reach but they’ll be more helpful to those lucky enough to get through, according to Kunstman.

Those phone lines are strictly for standard UI claims. PUA applicants don’t have a phone number to call.

Many of the outstanding, unpaid claims have been flagged for “job separation” issues, where examiners try to verify whether a claimant was actually laid off or left under different circumstances.

“The process is just too slow to push those through,” Yee said. A big problem is that claimants must be deemed ineligible in the regular UI system before they can apply for PUA.

Ah Puck, for example, said she had to wait months to secure a full denial from the regular UI system for a part-time job she worked at a Maui hotel. Only then was she able to collect PUA payments.

Sometimes claimants start collecting PUA payments only to learn that they’re eligible for regular UI after all, meaning they’ll have to return the PUA payments and sort out what they actually owe, Yee said.

‘I Don’t Know If We’re Ever Going To Catch Up’

From late May through July, DLIR saw between 6,000 and 8,000 new claims each week, according to data provided by the agency.

That’s down from the 53,000 new cases that swamped the department during the first week in April.

Asked whether DLIR had sufficient staffing and resources to handle the demand at this point in the pandemic, Kunstman said he wasn’t sure.

“That’s the $64,000 question,” he said. “There’s so many unknown factors.”

It largely depends on what Congress opts to do to provide more pandemic relief, he added.

“We’re just going to continue to ramp up staffing and training as fast as we can,” he said. “I don’t know if we’re ever going to catch up while we have this level of unemployment.”

Scott Murakami, who heads Hawaii’s unemployment agency, was a frequent guest on news programs like this one on Hawaii News Now until he quietly went on leave. The governor’s office said it doesn’t know when he’ll be back. Courtesy: Hawaii News Now

Now, with the number of reported COVID-19 cases in Hawaii surging to record levels, DLIR is concerned it could see another wave of initial claims.

The department said it’s largely been swamped with fraudulent cases. As of late July, DLIR had received nearly 94,000 PUA applications. Some 44,000 of them were denied — and the “vast majority” of those were found to be fraudulent, according to an agency release.

Hawaii’s low unemployment rate when the pandemic struck left it at a disadvantage, Kunstman said. Its annual federal funding had dipped to about $12 million, compared to around $17 million during the Great Recession, when unemployment was higher, he said.

DLIR has asked the Legislature for a $4 million boost to its operations budget during the past two fiscal years, including the most recent session after the pandemic hit, but it’s been denied both times, Kunstman said.

“We asked and we did not get any general funds to support the administration,” he said. That’s likely because state leaders expect the federal government to cover those costs and more, Kunstman added.

Getting those dollars earlier, from the state, would not help speed payments up, Kunstman said.

“The resources are there,” he said. “It just takes time.”

Lau, the film and TV worker, said she recently applied for the city’s Household Hardship Relief Program. She noted that thousands of families are still facing similar, dire financial circumstances.

“Maybe somebody needs to light a fire on somebody’s ass,” she said.

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