Gustus: Questionable Unemployment Claims Drain Budgets

Following last year's effort that gave them greater leeway in saving money on health insurance expenses, officials in Lynnfield and other towns are calling on Governor Patrick to take a look at another issue that costs local taxpayers a significant amount of money - the filing of questionable unemployment claims by municipal employees.

"Unemployment compensation payments are a direct expense to municipalities," states a letter to Governor Patrick from Lynnfield Town Administrator William Gustus and which also includes the names of 23 other town administrators, finance directors and town accountants from various Massachusetts cities and towns.

"Given the relatively stable nature of public employment and the strong due process policies found in most municipalities, layoffs and wrong terminations are unusual. Therefore, most communities choose to self-fund unemployment, and consequently, these types of cases are killing us financially."

The letter cited several cases from across the state without naming communities or individuals involved. For example, one example was a retired police officer who filed for unemployment benefits after working the maximum $25,000 in detail assignments per year that one can work while collecting a pension - and who could then go back to doing paid details once a new year began.

"We have heard that in many communities, when public safety employees reach the mandatory retirement age of 65 and retire on healthy pensions, many apply for unemployment and collect not only their full pension but also 99 weeks of at least partial unemployment benefits at the expense of the municipality," said Gustus in the letter. "Once again, the law caused the loss of their job. This places communities in an impossible situation."

The letter went on to note that some teachers have also been able to collect unemployment benefits in unintended ways. For example, a teacher who receives a notice of contract non-renewal on May 15 because of lingering budget negotiations or some other reason can still file for unemployment even though they would be paid through the end of August anyhow. "So, for the entire summer, the town will have paid their salary and paid them unemployment as well," wrote Gustus.

The letter also cited cases involving school bus drivers collecting unemployment during school vacation periods, and firefighters who go from full-time status to call status and collect unemployment while continuing to do call work for a town.

The officials whose names appear on the letter come from municipalities ranging from Dedham, Peabody and Andover to Boxford, Northampton, Orleans and Wellesley - 23 officials in total. At this point, they are not asking the Governor to take any specific actions to address this issue, but instead, seem to be trying to bring it to his attention.

"The frustration of local finance officials regarding all of this is real, and we respectfully request your assistance in addressing these concerns," wrote Gustus to the Governor.