From lost homes to mounting debt, workers from across the state share how they were impacted by payment delays, fraud panic and mass confusion about unemployment benefits.
Lose your job, file for unemployment, get a few hundred dollars a week from the state to pay for essentials while you find a new gig.
It sounds simple, in theory. But that’s far from the reality that many workers experienced when the state’s job safety net unraveled during the pandemic.
Five million people — about 1 in 8 Californians — got stuck waiting for delayed payments from the California Employment Development Department. More than 375,000 unemployment debit cards were cut off without warning. As few as 1 in 1,000 workers calling for help got through on jammed state phone lines.
In the 3½ years since COVID shutdown orders began, state audits, class-action lawsuits and unemployment experts have blamed the problems on different factors: crushing demand, outdated technology, inconsistent funding and unprecedented fraud, among others.
EDD officials say that change is coming with a new five-year, $1.2 billion effort to overhaul the department’s unemployment and disability systems. But the stakes are still high when something goes wrong, as it did for millions of people during the pandemic.
Here are some of their stories.
Location: Carlsbad to Tecate, Mexico
Problem: Never received EDD Bank of America debit card, taxes garnished
Impact: Moved across the border to Mexico, separated from family
As California locked back down in late 2020, Danny Ramos needed an out.
On paper, the San Diego construction worker had more than $8,000 in his state unemployment account after losing a soundproofing job that summer. But, Ramos told a state appeals judge, he never received an EDD debit card to access the money.
“I just went into panic,” Ramos recalled. “Like, ‘How the hell am I going to pay for my apartment?’”
He packed up his place in Carlsbad and found a cheaper rental just across the Mexico border, in Tecate. His then-fiancé took the kids to stay with family in the Midwest — a split Ramos said he thought would be temporary.
But by the spring of 2022, Ramos was still living in Tecate and riding his motorcycle across the border each day to work near San Diego. And then he became one of hundreds of thousands of workers whose unresolved unemployment cases came back to haunt them.
Ramos was flagged for potential fraud after the EDD said he did not send in required identity documents, then was ordered to repay the benefits he never received. He’d never gotten the notices after he moved and only realized what was happening, Ramos told a judge, when the state garnished more than $2,200 from his tax refund.
He filed an appeal, spent $1,800 on a lawyer, then waited months for a hearing before the judge ruled in his favor this past August. In late October, paper checks finally started to arrive with the long-delayed money.
Other losses can’t be repaid. Ramos said his wedding was called off. He’s rebuilding his life alone.
“I’m just still trying to catch up to where I was,” he said. “And I don’t even know if I ever will.”
Location: Big Bear Lake
Problem: Payments delayed for past penalty
Impact: Considering selling her house
As a longtime seasonal hospitality manager in Big Bear Lake, Donna Cook thought she understood how to file for unemployment with the EDD. But the pandemic brought a whole new level of stress, confusion and up to 4½-hour waits on the phone.
“They become the center of your life,” Cook said. “It’s always negative, and you’re already feeling down on yourself for being unemployed.”
The trouble for her started in mid-2021, when she said several payments for her pandemic unemployment claim came late. Then came a letter from the EDD ordering Cook to repay the agency for failing to report $61 of income. The agency wanted back $79, including a 30% penalty, despite Cook’s argument that she hadn’t meant to deceive anyone and received the extra money from an orientation that she did not know was paid.
The timing of the confusion, while she was caring for her terminally ill mother, was terrible. Cook pitched in for utilities but had to rely on her mom to buy groceries.
Like thousands of other workers who are penalized each year for even slight income miscalculations or clerical errors, the worst of it came the next time she had to file for unemployment.
Late this past summer, Cook lost another hospitality job, filed for benefits and was confused when she didn’t get any payments, leaving her in a familiar loop of dialing the EDD and getting a message that all agents were busy. This time, she was struggling to keep paying for the small house she’d just bought with the money she said her mom left when she died.
Finally, Cook got through in October to an agent who delivered the bad news: Under the EDD’s strict payment rules, she had to serve a five-week penalty for the previous overpayment, leaving her in limbo once again.
“I don’t know how they expect people to wait,” Cook said, “when you’re already living check to check.”
Maria and Maribel Sanchez
Age: 69 and 27
Location: San Francisco
Problem: Payment delays, language translation and fraud accusations
Impact: Sued the EDD — and won — after taking on debt
When Maria Sanchez got the letter telling her she owed the state more than $2,000, she thought she didn’t have any choice but to sign up for a payment plan she couldn’t afford.
“I would have paid that money to the EDD,” Sanchez said in Spanish, recalling “a lot of fear.”
Her daughter Maribel, however, had a different idea.
The law student had watched for months as her mom — a longtime San Francisco nanny who emigrated from El Salvador in 1976 — struggled to explain to the EDD, in Spanish, how she’d lost her job and spent months waiting for unemployment payments.
The last straw for Maribel was when court records show that her mom was accused of fraud and ordered to pay back some of the money for making a “false statement” in a language she doesn’t speak fluently.
“There was so much fraud going on with the EDD scams,” Maribel recalled. “I’m like, ‘You’re going to come after a 66-year-old lady that doesn’t have money to begin with?’”
In mid-2021, the family found a lawyer at advocacy group Legal Aid at Work to challenge the notice ordering her to pay back $1,750 in benefits, plus a $525 penalty. The following February, they filed a legal complaint in Superior Court arguing that the EDD’s fraud allegations were based off of a conversation in English that “contained obvious inaccuracies.”
It took multiple rounds of appeals and legal hearings, plus living on high-interest loans in the meantime, but a judge cleared Maria in 2022.
Still, Maribel can’t help but wonder, how many others weren’t so lucky?
Problem: Unemployment debit card frozen
Impact: Started a a GoFundMe to survive during a gender transition
As Hollywood shut down with the rest of the world in early 2020, losing her job as a video editor wasn’t Madeline Maye’s biggest concern — at least at first.
Right before quarantine, Maye said she had come out as a trans woman. She started hormone therapy two months later. New clothes that she ordered online or got second-hand helped make her feel more like herself. And she was doing it all while estranged from family.
“It’s kind of hard to describe how much stress that is,” Maye said. “It’s basically having to discover an entire new person that you always were, from scratch.”
Then she awoke one morning in mid-2020 to find that the unemployment money she was relying on to survive had disappeared. Maye said in a legal filing that she noticed a string of mysterious ATM charges on her state-issued Bank of America EDD debit card, which at one point showed a negative balance of $5,000.
“It was terrifying,” she said. “That was my only source of income, and all of a sudden, it was gone.”
Maye was one of thousands of Californians experiencing similar issues with frozen debit cards. With few answers at the time, she started a GoFundMe campaign, raising money from friends and strangers online to pay for rent and other essentials, while she said the state’s Medi-Cal program continued paying for hormone treatments.
After several months of staying in touch with her state representative’s office, Maye said she got her money back. In 2021, she joined an ongoing class-action lawsuit against Bank of America.
“It was one of the worst times of my life,” Maye said, “and there’s zero reason why it should have happened at all.”
Location: Fairfield to Wickenburg, Ariz.
Problem: Never received unemployment
Impact: Drained retirement savings, sold his house and moved out of state
In March 2020, Kelly Swanson came down with what he remembers as “a really intense flu.” He went home sick from his credit union IT job of 23 years just as the first pandemic shutdowns hit Solano County.
So began a chain of events that Swanson, now 53, said would lead to draining his retirement savings, being forced to sell his house in Fairfield and leaving California in his new home: an RV that his wife took to calling “a roving coffin” — an example of the domino effect that can happen when workers say the process is too daunting and they give up on fighting for benefit money.
“I was screwed six ways to Sunday,” Swanson said in a recent call from the trailer park where the couple now lives in the old mining town of Wickenburg, Arizona.
At first, Swanson received disability payments when the flu turned out to be a more intense long-term illness that he now assumes was COVID-19. Things got more complicated in the summer of 2020, when he was laid off and filed for unemployment.
The money never came, Swanson said. Instead, he was summoned to a call with the EDD and said he was questioned about fraud.
“It scared me enough that I was like, ‘Nevermind, you can cancel my application,’” Swanson said. “I don’t want to commit fraud.”
An unfruitful job search followed, and Swanson said he started borrowing from his 401(k). He sold his house in the summer of 2022 and moved most of his belongings into storage. Since he and his wife arrived in Arizona, he estimates that he’s applied for 270 office jobs, but he said he’s working at an ACE hardware store earning $15 an hour.
“My key takeaway from all of this,” Swanson said, “is just because you saved for retirement and just because you worked for a company and paid your taxes, don’t expect the state to come help you.”
Location: Orange County to Washington, D.C.
Problem: Accused of fraud and ordered to pay back more than $20,000
Impact: Still fighting third EDD appeal, last two years of tax returns garnished
As Nicole Oyler awaits a hearing on her third EDD appeal, anxiety bubbles up each time she opens the mail and sees the agency’s name on an envelope.
“It’s just hanging over you,” she said. “All day you’re thinking about it.”
Oyler wasn’t living in California when the coronavirus hit. She had recently left her Orange County hometown and moved to Washington, D.C., to chase her dream of working in museums. When her first museum job in D.C. disappeared with pandemic shutdown orders, she filed for unemployment with officials in the nation’s capital. At first, everything seemed fine — even better than before, with the added benefits allotted for laid-off workers during COVID.
Then, in early 2022, everything came screeching to a halt. Her $2,300 tax refund was seized for “government debts.” According to the nation’s byzantine unemployment rules, a lawyer helped her figure out, she should have filed for unemployment in California. And in the meantime, records show that officials in Washington wanted their roughly $20,000 back.
So began Oyler’s surreal quest to prove her own identity and clear the five-figure debt.
Officials say multi-state unemployment cases are inherently more complicated, but it’s an issue impacting more people amid broader shifts toward remote work and an exodus of hundreds of thousands of California residents moving to other states.
In May 2022, the EDD rejected Oyler’s identity verification documents. Then her online account showed that “some guy” had received unemployment in California using her Social Security Number. In June 2022, she got a letter from the EDD that she couldn’t read because it was in Spanish. Her next tax refund was also garnished.
Today, Oyler has a new job. She’s taking a philosophical outlook on the bureaucracies she remains trapped between.
“There are people that believe that we should have a social safety net, and there are people that don’t,” she said. “You end up with this creature that we have now, that’s under-funded and under-staffed. It’s going to fail.”
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