• The Star Staff

Jaresko: $84 million in Education Dept. salary overpayments going back to 2007 included ex-employees

By The Star Staff

The Puerto Rico Education Department (DE) has paid out since 2007 about $84 million to some 17,000 inactive and active workers, Financial Oversight and Management Board Executive Director Natalie Jaresko said Wednesday.

Jaresko did not know exactly how much of the $84 million went to employees who were no longer at the agency because, she said, part of the amount may have been an overpayment to active employees, “but the overwhelming majority went to inactive workers,” she said.

She said about 2,000 active employees may have been overpaid for a total of 17,000 workers who got checks they did not earn.

The agency has recovered about $4 million for a total of $80 million the agency still needs to collect.

“Payroll must be paid only to employees who earn their salaries …,” Jaresko said. “When an employee quits, retires or unfortunately dies, the system must reflect that change in status immediately and that change in status must immediately be reflected in the payroll system.”

Jaresko said the fiscal plan has asked for agencies to implement automated time and attendance but only one agency, the Treasury Department, has it in place. Some 12 agencies and instrumentalities have automated time and attendance but do not use it to automatically affect data linked to payroll. Others are on their way to having automated time and attendance. She said many have manual time and attendance, which is prone to fraud.

The DE has some 40,000 workers, making up 40 percent of total government employment on the island. The agency invested in an automated system in 2007 but only recently has the system been configured. It currently has the time clocks available in laptops and mobile phone apps as classes are being held online.

“However, those who do not punch out still get paid because the system is not mandatory,” Jaresko said. “The data shared with us is a systemic failure that allowed thousands of employees to be paid and now they must return the phones.”

While the problem was first detected in November, a chart shown by Jaresko shows that the DE paid out $3 million in overpayments in 2020. In 2019, the agency overpaid $9.1 million and in 2018 and in 2017, $3.7 million.

Jaresko said the problem has already been reported to local and federal authorities. She urged employees who were wrongly paid to return the funds. The Treasury Department has also been tapped to participate in the process of recovering the wrongly disbursed funds.

“I have confirmed this morning that the government will collaborate with us,” she said.

Going forward, Jaresko said, all agencies, not only the DE, must connect to the automated Kronos automated attendance system. There must be a validation and forensic accounting to validate the process. She asked for full implementation of time and attendance payroll across all government agencies, but “we are going to start first with DE, which is 40 percent of total government employment,” she said.

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