When Caryne Mount lost her job as a sales representative for a sewing machine company in February, the Grants Pass resident promptly filed for unemployment benefits, received two checks, then found herself in limbo.
The state switched to a new computer system for processing claims last month and placed her claim “in suspense.” The Oregon Employment Department then sent her a confusing questionnaire, asking if her job loss was somehow related to spring break.
“Which I thought was very odd because I wasn’t teaching,” Mount said. She had taught a community college sewing class a year earlier at Rogue Community College, but that had nothing to do with her layoff. It seems, though, that it is somehow getting in the way of her receiving aid now.
So Mount tried to call the employment department for an explanation and got nothing but a busy signal or long waits on hold, “listening to terrible Kenny G-like music for up to five hours,” only to be disconnected before ever reaching anyone.
Accustomed to paying every bill on time, and helping her children with their student loans, Mount said she now finds herself using food stamps to buy oatmeal so she has something to eat. She’s confounded that there’s nowhere she can turn for answers.
“What do you do? Just wait?” Mount asked. “Who knows how long it’s going to take?”
It’s been seven weeks since the Oregon Employment Department launched its new computer system, called Frances Online. Unemployed Oregonians like Mount say they’re exasperated and struggling financially.
The employment department’s leaders say Frances Online is performing fine, technically, and that it’s paying most claims promptly. Total weekly payments are roughly on par with the what the agency was paying before the new system kicked in.
The leaders acknowledge, though, that it’s not been easy for everyone and that many are frustrated by the communication breakdown.
“We know that the transition has been difficult for some because they haven’t been able to get through to us,” David Gerstenfeld, the employment department’s director, told reporters on a call last week.
The Legislature allocated funding last month so the employment department can hire more staff to process claims and answer calls. But the money won’t start arriving until the end of June, and Gerstenfeld said the benefits of that hiring won’t kick in until the second half of the year, “at the earliest.”
Resurgent problems
Oregon’s $106 million Frances Online system began handling jobless claims March 4. It replaced an obsolete system from the 1990s that hobbled the employment department during the pandemic.
Frances Online is designed to be more adaptive and interactive than its predecessor. Gerstenfeld said it’s performing as expected in that regard and the employment department has been able to quickly make adjustments to fix issues that tripped up claimants in the days after its launch.
That’s in contrast to the 1990s-era, mainframe technology Oregon had in place in 2020. That aged system was too rigid to handle the influx of claims that accompanied Covid-19 layoffs and it couldn’t adapt to new relief programs Congress established during the pandemic recession.
The new technology hasn’t solved problems that predated Frances Online, though, notably long hold times and slow claims processing.
Those were common issues during the pandemic that resurfaced last year. The employment department blames a falloff in COVID-19 federal funding that triggered a two-thirds reduction in the number of staff processing benefits applications.
“We haven’t been able to maintain service workloads. And the public feels that, as do we,” Gerstenfeld said. He suggested that the issues people are having with their claims may not be directly related to Frances Online, but that the shift to new technology brought fresh attention to pre-existing problems.
Complicating matters, the employment department says it has been doing extra work to scrutinize claims to guard against fraud.
Similar issues have affected Paid Leave Oregon, the state’s new family and medical leave program, which is also administered by the employment department and also uses the Frances Online system. The program experienced long backlogs in process claims after its September launch and questions remain over how quickly it is processing claims now.
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Last month, the Oregon Legislature passed a bill that will redirect $45 million in funding over the next two years to administering the unemployment insurance program. Gerstenfeld said that’s enough to hire 72 more people to answer phones and process claims.
Lawmakers initially took up the bill last year, but it died before getting a vote, a victim of a contentious legislative session and Republican walkout. The new bill doesn’t take effect until the end of June and even then, the employment department warns it will take time to hire and train the additional staff.
“It will take several months for that to show significant benefits,” Gerstenfeld wrote in a March memo to Gov. Tina Kotek’s office.
Most claims are still being processed quickly. But the agency’s cautions to the governor’s office and to the public suggest that some new claims will continue to encounter delays and the agency won’t resolve its communication issues anytime soon.
For now, Gerstenfeld said the agency is trying to educate laid-off workers on how to check and update their claims online, without calling in. It hopes that could reduce the backlog on the phones, at least a little bit.
And it’s asking people with questions about their claim to submit just one inquiry, and to give the department “a few days” to make updates such as address changes.
One change not on the table: hiring an ombudsman to advocate for laid-off workers and help them navigate the complex unemployment system.
The secretary of state’s office recommended the department hire an ombudsman in a 2022 audit, noting that other states have such a position and other Oregon agencies do, too.
An advocate for claimants “could help people who may not be able to advocate for themselves and help identify and document trends or gaps in the claims process (the employment department) could then investigate, monitor, and improve upon,” the auditors wrote.
The employment department said at the time it agreed with all the auditors’ findings two years ago. But it hasn’t added an ombudsman, and Gerstenfeld said the agency doesn’t plan to do so anytime soon.
“Right now I don’t think that is the highest use of our limited funds,” Gerstenfeld said. He said the agency already gets good outside feedback from legislators, employers and people seeking assistance.
“We don’t need an ombudsperson to tell us that people want to be able to get through on the phones more easily and that the people whose claims are taking too long want those claims to be addressed more quickly,” Gerstenfeld said. “At this point we think that it is much more effective to focus our resources on having people answering the phones, processing the claims, doing the adjudication.”
In messages to Kotek’s office last month, obtained through a public records request, Gerstenfeld indicated he thought concerns about Frances Online might be overblown.
“Some media coverage has been quite critical of the roll out. Some of that reporting has significant factual inaccuracies,” Gerstenfeld wrote.
Additionally, he made the curious assertion that “criminal actors” might be damaging perceptions of the employment department by “reaching out to our agency employees and potentially the media and legislators, something we have seen take place in the past.”
The employment department declined to specify what media coverage it considers inaccurate. It said it believes thieves are trying to manipulate journalists and lawmakers in an effort to apply pressure on the agency to pay fraudulent claims, though it did not provide any examples of this taking place. The agency said that doing so could invite additional fraud.
The employment department enjoys a broad exemption from the state’s public records laws and has used that exemption, since the pandemic, to shield from view information about how much fraud the agency is encountering and how that’s affecting operations.
The governor’s office recognizes “there are claimants facing legitimate hardships accessing their unemployment insurance benefits on the new Frances Online system,” said Anca Matica, press secretary for Kotek. “The governor also believes that there is a threat of fraudsters taking advantage of the new online system.”
While the employment department awaits more funding, Matica said Kotek and her staff are working with the employment department to ensure it’s doing everything possible to reduce wait times.
That includes “exploring what additional funding will be needed to hire more staff to help process complex claims.”
For the time being, that leaves people like Portland bartender Nicole Powser in a kind of purgatory. She lost her job in November and received jobless benefits intermittently, then lost them completely without explanation.
“After they rolled over to Frances (Online), I sent a message every single day for, I think, two weeks and I did not get one response,” Powser said. She said the interruption in benefits meant she couldn’t cover her rent and she had to move out of the apartment she and her son had been sharing.
So Powser said she sent her son to stay with a friend, and she resorted to sleeping in her car.
“I’ve never been so broke in my entire life,” Powser said. She said the lack of aid clobbered her credit score and cost her a line of credit when she started missing payments.
The family is together again, staying in another friend’s living room, and unemployed benefits resumed at the beginning of the month. But Powser said she doesn’t have enough money for a deposit on a new apartment and can’t reach the employment department to untangle her benefits issues.
“How am I supposed to look for a job,” she said, “when I’m on hold with the employment department for five hours every day?”
Update: This article has been updated with more information about why the employment department believes thieves are pressuring media and lawmakers.
-- Mike Rogoway covers Oregon technology and the state economy. Reach him at mrogoway@oregonian.com.
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