How Does EDD Estimate Benefit Accuracy?

Unemployment benefits are part of a joint federal-state program. Together, with the U.S. Department of Labor (DOL), we evaluate sample claims data to help improve accuracy in paying benefits. A key segment of that benefit accuracy data on DOL's website is labeled "Improper Payments" including:

• Improper Payments (Non-Fraud Overpayment or Underpayment): Too much or too little paid in benefits due mostly to claimant mistakes or delayed employer reporting. We work with these individuals to correct or collect when overpaid.
• Improper Payments (Customer False Statements): Individuals with verified identities who misrepresent facts on their unemployment claim, including knowingly withholding information in order to qualify for benefits. We catch these false statements from our customers through data crossmatches. Customers must then return the money through our overpayment recovery processes and could also have to pay significant false statement penalties.

Note: EDD takes aggressive action against criminal fraud. Learn more about everything EDD does to prevent criminal fraud and hold fraudsters accountable by visiting Our Response to Criminal Fraud.

Warning for Unemployed Workers Who Knowingly Provide False Information About Their Claim

Improper Payments, Customer False Statements

Unemployment benefits are there for you when you lose your job through no fault of your own and you meet all eligibility requirements. We crossmatch the information you give us with new hire data and wage records from employers. If we find that you knowingly chose to provide EDD with false information about your eligibility, or knowingly withheld information to get more benefits than you qualify for, you could face significant fraud penalties:

• In addition to having to pay back any overpayment, you could owe an additional 30% false statement penalty.
• You could also be disqualified for future unemployment benefits for up to 23 weeks of the next time you’re without a job.
• If you ignore your overpayment, we are legally required to collect the money from you in a number of ways, including withholding your tax refund and state lottery winnings.

The most common infraction we find is when we get new hire or wage data showing a claimant going back to work without reporting it to EDD. Intending to collect both unemployment benefits and their new wages at the same time is a fraud Improper Payment.

Helping Unemployed Workers Avoid Mistakes

Improper Payments, Non-Fraud

We know mistakes can happen, especially during a stressful time like unemployment. That’s why we continue to update our systems and simplify instructions and communications — to make things easier to understand and help you provide accurate information for a smooth benefit experience.

• Wage Reporting: This is the number 1 reason for improper payments. People may get confused about when wages are earned and when they are actually paid, or they may not know the difference between gross wages (earned before deductions) and net wages. In October 2025, we launched a new Wage Reporting Tool to make reporting wages easier and to help you get paid faster.

• Separation from Work: This is the number 2 reason for improper payments. Benefits are intended for unemployed individuals who lost their job through no fault of their own. For example, through a lay-off. But we’ve found individuals can be confused about their separation. In addition to simplifying questions to help with this, we’ve also launched expanded online eligibility questionnaires. Instead of waiting for a scheduled phone interview to provide clarifying information, you can now conveniently respond to those requests online and help us speed up payments.

What to Expect If You Get an Overpayment Notice

If we determine you collected unemployment benefits you were not eligible to receive, we will send you a notice of overpayment which will include:

• The total amount due.
• A summary for each week that you were overpaid.
• Information on how to appeal.

In addition to the appeal option, you may also request an Overpayment Waiver. If the overpayment remains, we can offer an installment repayment option. Visit Unemployment Overpayments and Penalties to learn more.