NY unemployment slammed me with interest charges after overpayment - payment plan suddenly invalid?
I need help urgently! My friend got hit with a NY unemployment overpayment notice months ago even though they received the same amount every week and never had any breaks in their claim. They didn't work at all during their claim period (their employer never called them back before benefits ran out in September 2024). After getting the first notice, they called unemployment and set up a payment plan which they've followed religiously, never missing a payment. But on Friday they got a letter demanding the ENTIRE remaining balance by June 30th (which was literally the day before they received the letter)! The letter also stated they're now being charged interest on the amount - which was never mentioned when they set up the payment plan. The interest rate is ridiculously high and keeps increasing daily! My friend checked all their payment history and there's absolutely no evidence showing any overpayment occurred in the first place. I've never heard of NYSDOL charging interest on overpayments, especially when someone is following an agreed payment plan. Has anyone dealt with this? Is this even legal to demand full payment the day AFTER the deadline with no warning?
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Oliver Alexander
OMG i literally got almost identical letter yesterday!!! my hands were shaking so bad i could barely read it. i also had payment plan for 6 months now and suddenly they want everything NOW?? no way i can pay $4700 by next week! the interest charges are INSANE, where did these come from??! im freaking out thinking they'll garnish my wages. did your friend call them yet? I tried but couldn't get through the phone system (as usual
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Kaylee Cook
•They're trying to call today but you know how that goes... been on hold for over an hour already. This seems so sketchy to demand payment after the deadline has already passed. How can they even enforce that? I'll update if they manage to talk to anyone.
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Lara Woods
This sounds like the new aggressive collection practices NYSDOL started implementing in April 2025. When a payment plan is established, it should include ALL terms including interest rates, but many agents have been forgetting to disclose this. The system automatically generates these "final notice" letters when an account is flagged for interest accrual beyond a certain threshold. Your friend needs to request an emergency review of their payment arrangement. Here's what they should do: 1. Call DOL and specifically request a "Payment Plan Review and Interest Suspension" (use these exact words) 2. Ask for documentation of the original overpayment determination letter 3. If they can't prove the overpayment occurred, request an "Overpayment Evidence Review" 4. Get everything in writing and request a confirmation number for the call Also important: by law, they CANNOT demand payment for a date that has already passed. That alone gives your friend grounds to contest the letter.
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Kaylee Cook
•Thank you so much for this detailed information! I'll pass this along right away. Do you know if there's any way to expedite getting through to someone? They've been trying all morning without success.
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Adrian Hughes
just fyi they did this to me last year. kept paying my plan then suddenly BAM full payment + interest. turned out to be a system glitch in their new collection software. had to talk to THREE different reps before 1 actually knew how to fix it. goodluck getting thru tho lol
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Oliver Alexander
•Was your payment plan reinstated once you finally talked to someone who knew what they were doing? Did they remove the interest charges too?
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Molly Chambers
The NYSDOL has become a PREDATORY agency since they updated their systems this January!!! I'm in a similar situation - was on a payment plan for alleged overpayment (which I'm STILL fighting), and suddenly got hit with "final notice" and MASSIVE interest charges. They're DELIBERATELY making it impossible to contact them, then using that as excuse to add MORE penalties!!! They're hoping people will just pay out of fear rather than fight their bogus claims. This is a SCAM being run by our own state government!!
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Adrian Hughes
•yep. they count on most ppl being too scared to fight back or not knowing their rights. typical govt bs
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Ian Armstrong
wait they can charge interest on unemployment overpayments??? since when?
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Lara Woods
•Yes, as of January 2025, NY Labor Law § 598.4 was amended to allow interest charges on overpayments that remain unpaid after 90 days from determination, EXCEPT when a payment plan is in good standing. The standard rate is 7.5% annually, but it can increase to 12% after 180 days. However, this should NOT apply to people who have established payment plans and are making their payments as agreed.
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Eli Butler
Have you tried using Claimyr to get through to an agent? I was in a similar situation last month with an overpayment issue and spent days trying to get through the regular phone line. Finally used Claimyr (claimyr.com) and got connected to an agent in about 20 minutes. They have a video showing how it works: https://youtu.be/Rdqa1gKtxuE. The agent I spoke with was able to reinstate my payment plan and remove the interest charges since I had documentation showing I was following the agreement. Saved me almost $900 in bogus interest charges.
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Kaylee Cook
•I hadn't heard of this service before. Is it legitimate? Did you have to provide any personal information? My friend is desperate to talk to someone but can't afford to take another day off work just to sit on hold.
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Eli Butler
•It's completely legitimate. You just input your phone number and they call you back when they have an agent on the line. I was skeptical too but was out of options. Definitely recommend having all your documentation ready when they connect you. The agent I got was actually helpful once I finally reached someone who could access the payment arrangement system.
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Marcus Patterson
I'm a former claims specialist (left NYSDOL in March). Here's what's happening: The department implemented a new automated collection system that's full of bugs. The system is automatically generating these letters without checking if there's an active payment plan in place. Interest charges are only supposed to apply to accounts without payment arrangements or with missed payments. What your friend needs to do is: 1. Continue making regular payments as per the original agreement 2. Request (in writing AND by phone) a "Payment Plan Validation Review" 3. Send a formal appeal letter citing "Administrative Error Code UIC-27" (this refers specifically to payment plan errors) 4. Demand written confirmation that the payment plan remains valid The bug is affecting thousands of accounts but they're keeping it quiet while they fix the system. Keep all documentation of payments made and the original agreement if possible.
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Oliver Alexander
•Is there a specific department or unit we should ask for when calling? Or a specific form to request the Payment Plan Validation Review? This is super helpful information!
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Marcus Patterson
•Ask for the "Overpayment Resolution Unit" specifically, not the general claims department. They're the only ones with access to override the automated collection system. There isn't a specific form - you need to request it verbally and then follow up with a written letter. Make sure to reference your original payment plan establishment date in all communications.
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Kaylee Cook
UPDATE: My friend FINALLY got through to someone after using that Claimyr service mentioned below. The rep confirmed this was caused by a system error! Apparently the new collection system doesn't properly recognize payment plans established before March 2025. The rep had to manually override the system and issue a "Payment Plan Continuation Notice" which cancels both the demand letter and the interest charges. They're sending written confirmation that should arrive within 5-7 business days. For anyone else dealing with this: make sure you specifically ask for the override and written confirmation. The first person they spoke with tried to claim nothing could be done until they escalated and asked for a supervisor using the exact terms that former employee mentioned above. KEEP PUSHING!
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Oliver Alexander
•Thank you so much for updating!! I'm going to try the same approach tomorrow. Did they have to provide any specific documentation to prove they had a payment plan, or could the rep see it in their system once they looked?
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Kaylee Cook
•The rep could see it in their system, but having the original payment plan confirmation number really helped speed things up. If you don't have that, they said having the date when you established the plan and the amount of the monthly payment should be enough for them to locate it in their records.
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Adrian Hughes
this almost sounds like a scam letter tbh. did ur friend check the phone # on the letter matches the official nysdol number? there were fake unemployment letters going around a few months ago trying to get ppl to call sketchy numbers
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Kaylee Cook
•That's a good point! They checked and the letter does have all the official letterhead and correct phone numbers. They also logged into their online account and the same demand shows up there too, so unfortunately it's legitimate. Just another NYSDOL mess-up.
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Molly Chambers
EVERYONE AFFECTED BY THIS NEEDS TO REPORT IT TO THE STATE COMPTROLLER'S OFFICE!!! If enough of us report this predatory practice, they'll be forced to investigate. I filed a complaint last week and received confirmation they're looking into these "systematic errors" - which I think is just their excuse for trying to squeeze extra money out of desperate people. The more complaints they get, the more pressure there will be to fix it and potentially refund those bogus interest charges to people who paid them out of fear.
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Lara Woods
•This is good advice. You can file a complaint with the Office of the New York State Comptroller online through their website. Choose the "Government Agency Complaint" option and specifically mention the automated collection system errors and interest charges applied to accounts with active payment plans. Include all relevant dates, confirmation numbers, and documentation.
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