October 14, 2011 DRAFT

 Benefit Year Earnings (BYE) 20% of BAM Improper Payments in 2010: Root Causes Identified:  Agency Causes  Too few BPC staff to adequately investigate and address cross-match hits  Not taking full advantage of traditional cross match, NDNH, and jail roster data  Lack of automation of cross-match activities  Not using all contacts with claimants and employers as an opportunity to educate  Claimant Causes  Lack of understanding of reporting requirements (difference between net vs. gross earnings; when earned vs. when paid)  Misrepresentation to agency of reported earnings 2

 Benefit Year Earnings (BYE): Planned action(s) to address:  Increase the number of integrity staff in new UI organization  Targeted outbound call campaign to claimants who have reported wages explaining their responsibilities  Revision of claimant communication tools (handbook, hold messages, call center scripts, IVR, etc.)  Procurement of enhanced cross-match automation  Use website to publicize fraud convictions and other consequences, i.e., time and monetary penalties Principal milestones:  New UI organization goes into effect 11/01/2011  Targeted outbound call campaign to begin 12/2011  Updated communication tools by 12/2011  Cross-match RFP to be released by 11/30/2011 3

 Separations (SEPs): 14% of BAM Improper Payments in 2010 Root Causes Identified:  Agency Causes  Incorrect separation determinations  Inadequate fact-finding at the time of initial claim submission  Insufficient number of staff to adequately adjudicate separation-related issues  Claimant Causes  Failure to report separations or inaccurate and/or incomplete reporting of separation information  Employer Causes  Non-timely submission of separation information or inadequate and/or incomplete reporting of separation information 4

 Separations:  Planned action(s) to address:  Increase the number of adjudication staff in new CDLE-UI organization—now focusing on both timeliness and quality  Provide refresher training for adjudicators  Determine whether to provide fact-finding training to call center agents  Use all communications with employers & claimants to stress the importance of timely submission of separation documents  Principal milestones:  New UI organization goes into effect 11/01/2011  Decision on role of call center in fact-finding, by 11/30/2011 5

 Work Search Issues: 41% of BAM Improper Payments in 2010 Root Causes Identified:  Agency Causes  Lack of specificity in current regulations concerning work search, recordkeeping, and record retention requirements  Lack of specificity in current claimant communications concerning work search, recordkeeping, and record retention requirements  Treating all failures to respond to BAM questionnaire as work search improper payments  Claimant Causes  Lack of understanding of work search, recordkeeping, and record retention requirements 6

 Work Search Issues :  Planned actions to address:  Develop new regulations to provide clarity and specifics on work search, recordkeeping, and record retention requirements  Issue formal warning letter to claimants who fail to respond to BAM questionnaire instead of establishing improper payment due to W/S – continue to establish improper payment on failure to respond  Claimants receiving formal warning letters will be subject to a higher frequency of audits  Revise claimant communication tools (handbook, hold messages, call center scripts, etc.)  Provide work search logs on line and reinstitute log in handbook for emphasis  Principal milestones:  New regulations in place by 1/2012  Updated communication tools by 12/2011 7

 Strategies to Support Owning UI Integrity:  Increase in the number of UI staff addressing improper payment-related issues  Clear articulation of our goal to exceed national average in terms of improper payments—and timeline and milestones for achieving this goal  Encourage staff from across the organization to “own” and report improper payments to BPC for investigation – additional staff in BPC will increase detection rates  Develop processes that promote the sharing of information across the organization for performance improvement and lessons learned  BAM results shared quarterly  Appeals reversals shared with adjudicator  Use data from BAM and appeals to identify training needs across the UI organization that will further reduce improper payments  Involvement of staff from across CDLE in the Integrity Task Force and in implementing this action plan 8

 Communications Strategies:  To claimants  Revised handbook with work search and earning logs  Revised hold messages and IVR scripts (both work search and BYE)  Targeted outbound call campaign to address BYE, Work Search issues  Congratulations letters to claimants who appear on the NDNH  To employers  Auditors to communicate importance of submitting forms timely  Use of quarterly Tax Newsletter to educate  Explore use of outbound call reminders 9

 Communications Strategies, Continued:  To state UI staff  Keep staff appraised of Integrity Task Force Activities  Involve staff in UI Integrity process improvement activities  To the public  Rulemaking process to strengthen work search recordkeeping requirements  Monthly UI Stakeholder Group meetings  To state leaders (Governor, state legislature, etc.)  Rulemaking process to strengthen work search recordkeeping requirements  Monthly UI Stakeholder Group meetings  Regular progress reporting to the Governor on activities related to improper payments responsive to Executive Order B

“Integrity: Own It!”  Questions?  State contact for follow-up: Brian Chesher: Phone: