Senator Mazie K. Hirono announced that the Department of Labor (DOL), Employment and Training Administration (ETA) is granting more than $11 million to the Hawaii Department of Labor and Industrial Relations (DLIR) to update the state's Unemployment Insurance (UI) system. This funding is part of the American Rescue Plan Act (ARPA) and aims to enhance the efficiency of processing unemployment insurance claims and prevent fraud.
Senator Hirono emphasized the importance of a robust and responsive UI system, particularly in light of the COVID-19 pandemic. She stated, "The COVID-19 pandemic showed us all the critical importance of a robust, responsive Unemployment Insurance system. As we work to modernize our UI system in Hawaii, this much-needed funding will help update outdated systems in order to increase efficiency in processing unemployment insurance claims and protect against fraud."
The funding will be used to improve Hawaii's UI technology systems, making them more user-friendly and accurate in disbursing unemployment benefits. Additionally, the modernization efforts aim to prevent fraud associated with unemployment insurance.
During the COVID-19 pandemic, the UI system faced significant challenges due to historic job losses. Outdated IT systems led to delayed payments, a surge in fraudulent activities, and disparities in benefit disbursements based on racial and ethnic backgrounds. The Department of Labor documented improper payments in unemployment insurance, which increased from $8 billion to $78.1 billion between 2020 and 2021.
The DOL has been actively allocating grants to fortify and modernize unemployment insurance systems across the country. On September 22, the department announced over $204 million in grants for 18 states and the U.S. Virgin Islands. These grants aim to enhance the dependability and user-friendliness of the systems. In July 2023, the DOL provided approximately $200 million in funding for states to invest in information technology projects to strengthen the agility and resilience of their UI systems. The department has also disbursed additional funding to states for program integrity and the implementation of recommendations.
Overall, the funding awarded to Hawaii will play a crucial role in updating and improving the state's UI system, ensuring efficiency in processing claims and preventing fraud. Senator Hirono's efforts highlight the importance of a strong and adaptable UI system, particularly in times of crisis such as the COVID-19 pandemic.