Waste, Fraud & Mismanagement:
Your Tax Dollars at Work

State Department of Corrections Paid $1.3 Million to Fired Employees. The California Department of Corrections and Rehabilitation spent nearly $1.3 million in just two fiscal years to pay unemployment benefits to workers who had been fired, according to a report released March 30 by the California Office of the Inspector General. The sum represented nearly 25 percent of the department's spending on unemployment benefits in 2006-07 and 2007-08, the inspector general said.

The report, which refers to fired workers as "adversely separated employees," stated: "The CDCR's lack of internal procedures to effectively process UI claims and poor communication between the CDCR and the Employment Development Department (EDD) contributed significantly to adversely separated employees receiving UI benefits. Of the 1,045 employees adversely separated during fiscal years 2006-07 and 2007-08, 186 employees received UI benefits."

Additionally, the report notes that unemployment benefits "should be available for employees who have lost their jobs due to no fault of their own, not for employees the CDCR separated for misconduct."

According to the report, the EDD did not do a good job of gathering information about people submitting claims for unemployment benefits, and the Department of Corrections did not do a good job of responding to the EDD requests that were made. "Of the 25 cases investigated, the CDCR responded in writing to the EDD only ten times and only five of the responses were timely," the report said. "Furthermore, the CDCR had the opportunity to appeal the EDD decisions to grant UI benefits; however, it did so in only one case."

Three case studies included in the report reveal that unemployment benefits were given to: a peace officer who was fired after she committed a hit-and-run accident while driving under the influence and then refused to cooperate with the California Highway Patrol; an officer who was fired because he was affiliated with a prison gang and possessed an illegal assault weapon; and an employee who was let go because she failed to report for work 132 days (the equivalent of six months of work) during her 15-month probationary period.

Mary Fernandez, undersecretary of the department, said the department agrees with the report's conclusions and is working with the EDD to fix the problems identified by the inspector general. (Source: California Office of the Inspector General Special Report, March 30.)

Cal-Taxletter, April 3, 2009

© 2009 California Taxpayers' Association. All Rights Reserved.