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When Will the EDD Audit Your Unemployment Insurance Claim

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  • 09-15-2015, 05:47 PM
    gonzodude
    When Will the EDD Audit Your Unemployment Insurance Claim
    My question involves labor and employment law for the state of: CA

    These questions probably have been answered on this site already. Anyways, here goes:

    Background:
    I have been receiving a partial UI benefit every week for almost a year, because I work less than 40 hours per week, and my income at my current job is low enough suh that I still receive a little each week in addition to my current job wages.

    My questions are about UI claim audits.
    1) Does the EDD conduct an audit on every UI claim?
    2) If so, is it done: daily, weekly, quarterly, yearly...?
    3) Do they look at what the employer reports, or what the employee reports?
    4) Referring to 3) above ^^ ... Or both, as in a "comparison" between the two?
  • 09-15-2015, 07:43 PM
    adjusterjack
    Re: EDD Audits
    Quote:

    Quoting gonzodude
    View Post
    1) Does the EDD conduct an audit on every UI claim?

    If they haven't conducted an audit on you for the almost a year, then the answer to that would have to be no.

    Quote:

    Quoting gonzodude
    View Post
    2) If so, is it done: daily, weekly, quarterly, yearly...?

    If you haven't gotten one in a year yet, I guess it's not done daily, weekly, or quarterly.

    Quote:

    Quoting gonzodude
    View Post
    3) Do they look at what the employer reports, or what the employee reports?

    If they look at all, probably both.

    Quote:

    Quoting gonzodude
    View Post
    1) 4) Referring to 3) above ^^ ... Or both, as in a "comparison" between the two?

    I'd say so.


    PS: At this point, what are you worried about? Or are you just the kind of person who likes to worry.:friendly_wink:
  • 09-15-2015, 07:43 PM
    chyvan
    Re: EDD Audits
    Quote:

    Quoting gonzodude
    View Post
    1) Does the EDD conduct an audit on every UI claim?

    They've got super computers collecting data. It spits out claims that need to be looked at.

    Quote:

    Quoting gonzodude
    View Post
    2) If so, is it done: daily, weekly, quarterly, yearly...?

    It can happen really fast now that things are getting or already tied in with the New Hire Database.

    Quote:

    Quoting gonzodude
    View Post
    3) Do they look at what the employer reports, or what the employee reports?
    4) Referring to 3) above ^^ ... Or both, as in a "comparison" between the two?

    I think it's a comparison and EDD will use whatever number makes things worse for the claimant. If the employer says they paid you more than you claimed, they'll use that one. If the employer reported less than you, they'll use yours. However, I've never heard of the second senario. The normal ones are that the claimant doesn't report at all or they report the NET instead of the gross, and they ALWAYS get caught.
  • 09-15-2015, 07:50 PM
    Ariadne22
    Re: EDD Audits
    Employers report wages to CA by week worked and are reconciled with what you report for that same week. CA almost always catches overpayments - usually very quickly.

    Employer reporting trumps yours - unless you can prove otherwise through paystubs.

    If you have been underreporting wages earned, if CA hasn't caught you already, it will.

    Penalty for underreporting in CA is five weeks dq from benefits for first week you underreport, additional week dq for each week thereafter, plus 30% penalty on amount overpaid. This penalty carries forward to any future claims for up to three years if not purged and/or served earlier.

    Know that CA participates in the Treasury Offset program and sends information on outstanding overpayments to the IRS for offset against any future tax refunds.
  • 09-17-2015, 02:17 PM
    gonzodude
    Re: EDD Audits
    OK, so what is happening is that I have been working for small business that pays me with a hand-written check each week. They have told me that they are going to put me on the payroll for 11 months now, and have not yet done so. Thus, they have not reported any wages they have paid me this year to the tax board. However, they have been taking out 15% for taxes out of each check. I'm assuming that it will be the same as the way we did it for Nov and Dec of last year: they reported it all at tax time.

    I'm just wondering if it is going to get me audited (by the EDD), or what is going to happen. I'm wondering if my employer has been getting notices from the EDD and not telling me perhaps ... ?

    NOTE: I ACCIDENTALY reported my net income instead of gross for approx. 1 - 1.5 months earlier this year. However, my claim ends this month anyways, and I only received about $200 more than I should have, so if I get penalized it is not going to be that big of a deal, especially since my claim is ending now anyways.
  • 09-17-2015, 02:31 PM
    chyvan
    Re: EDD Audits
    Quote:

    Quoting gonzodude
    View Post
    NOTE: I ACCIDENTALY reported my net income instead of gross for approx. 1 - 1.5 months earlier this year. However, my claim ends this month anyways, and I only received about $200 more than I should have, so if I get penalized it is not going to be that big of a deal, especially since my claim is ending now anyways.

    You'll have a mess on your hands because you don't know what your employer is going to do.

    Just because your claim runs out, doesn't mean anything. This is FRAUD. You don't get a break for that.

    That 1 to 1-1/2 months is between 4 and 6 FALSE claim forms. There will be penalities AND disqualified weeks that need to be served. I think you're going to find that this costs you far more than you think.

    While no one every does it, I think that if YOU call EDD to correct those prior claim forms, that you'll save yourself a bundle. Every thread on this topic is where the claimant was notified by EDD first. In your case, EDD doesn't know there is a problem yet, and you will be believed if you tell them "I reported net instead of gross, and I need to get that fixed."
  • 09-17-2015, 03:09 PM
    gonzodude
    Re: EDD Audits
    Yes, OK, perhaps I will try to correct the 4-6 weeks of overpayment, but will I even get to talk to anyone at EDD? Every time I have tried to talk to someone, all I've ever gotten is a recording. If you do get lucky enough to talk to someone, they majorly give you the run-around, and nobody can ever talk to you or tell you anything over the phone. Nobody at any of the EDD offices is going to help either. (Trust me, been there, done that, so I know) It is ridiculous!

    The other thing is that I was wondering what will happen if my employer reports all the income at the end of the year, as in Jan or Feb of 2016 for my 2015 wages. Is that going to get me audited by the EDD? Do you know what they do in these cases?
  • 09-17-2015, 03:25 PM
    chyvan
    Re: EDD Audits
    Send in an email on "ask EDD." Print it out. You'll most likely get a response that has nothing to do with what you submitted. SAVE IT.

    Then if EDD ever figures out what is wrong and tries to assess penalties out of proportion, you'll have the proof that you tried to fix it. That means it can't be fraud, and you're only obligated to pay only what you shouldn't have received.

    EDD doesn't audit. They respond to issues as they occur. If your employer reports earnings that don't match your selfreported earnings, EDD will come a calling. However, the penalties are so steep if you are later caught that it's just not worth it. Just fix it now, and then it won't matter what your employer does because you'll have done everything correctly.
  • 09-17-2015, 06:53 PM
    cbg
    Re: EDD Audits
    My claim was pulled for a random audit, not because of anything I did or was suspected of doing wrong but just because the DUA audits x% of claims regularly, almost a year after I'd found a new job and quit claiming.

    Granted, your state is not mine. But don't assume that because the claim has run out that means there's no further chance of audit.
  • 09-18-2015, 07:25 PM
    comment/ator
    Re: EDD Audits
    You'll have a mess on your hands because you don't know what your employer is going to l]]\

    What your employer does amounts to nothing. They have to send in this data. They don't give a crap who they're sending it in on, they're sending it in on everybody, quarterly. It's not personal. But honestly, if you do not have documentation showing that your information is different from theirs, they win. They just are more apt to do it right than you are. It would be to your advantage to show you were paid what you said you were. If you can prove it, goody. You did it right Otherwise, probably they are are right.

    Let it go back to the fraud unit. They're investigating you, and there IS a huge possibility of audit, even if you've drawn out your claim months agp. They will figure it out. You just pay it, if you messed up and misreported your wages while you were drawing. They're going to have a hard time believe you if you don't have exact figures and pay stubs to show you were right and the company was wrong. Keep calling. Don't give us this "Well, I couldn't get anyone, so I gave up." Keep trying. If you misreported, they'll catch up with you, and you'll be charged with the misrepresentation. One out of ten of every claims is supposed to be subject to this type of audit, it's required by federal law; Therefore you can't feel picked upon. They have the right to do it, and they do it. If you did everything and reported everything exactly right, you're fine. Other wise, if there are penalties to be drawn upon, if there are overpayments to be dealt with, you're going to have to deal with them. That's the way the system works.

    - - - Updated - - -

    "EDD doesn't audit" is not true. They do audit, they are required by law to audit a certain number of claims each cycle to verify quality control. Any claim that shows wages while the person was drawing benefits is apt to raise a red flag. It's possible you did report everything exactly right. It's possible you did not. They'll have the records to show exactly what you were paid and exactly what you reported.

    Where you are told that if you respond to inquiries not on the required and suggested forms, but on some other means, and you keep copies of this, and this will protect you from having committed fraud, or from failing to respond to their request for information, that's just wrong. You're liable to end up being prosecuted. Keep trying. Reach them. The people who are checking on your claim. Work it out with them now.
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