WHEN ANDREA RUSSO lost her job this past summer, she needed money, and she needed it fast.

Russo, a single mother who worked for Microsoft out of its Cambridge office, was abruptly let go as part of widespread downsizing throughout the company. After the tech giant cut her position, Russo had to rent out her house while she and her daughter, a high school senior, moved in with a friend. Her son who recently graduated from college is taking on a greater share of his student loans than was initially planned. Russo has had to dip into her savings account each month to live while she continues to look for full-time work in a tough job market — and fight what’s been an exhausting battle against state bureaucracy to get the unemployment insurance benefits she needs.

Five months later, she’s still fighting.

After weekly calls to the Massachusetts Department of Unemployment Assistance (DUA), being placed on hold for 45 minutes, in-person visits to state offices, and being told that “we’re escalating” the situation too many times to count, Russo is still without a full-time job and without financial support. She initially filed for benefits with the state in August, according to a copy of her claim viewed by CommonWealth Beacon, yet she hasn’t received a dime in unemployment insurance benefits and is still without so much as a tangible status update about where her case stands and what issues are preventing the money from being disbursed.

“I’ve never been unemployed before. I’ve had a job since I was 14 years old,” said Russo, a Rhode Island resident who filed for unemployment in Massachusetts because that’s where she was employed. “For once in my life, I need help, and I just feel let down.”

Russo’s claim is just a fraction of the mounting cases that piled up at the DUA over the better part of 2025, where an unemployment system that was already falling short of key federal performance metrics stumbled into a new crisis.

In each month between June and October, at least 4 in 10 new unemployment claims filed in Massachusetts by eligible workers went unpaid for 35 days or longer, according to federal data.

By that measure, Massachusetts was the worst-performing state in the nation over that span.

Anywhere from one-fifth to one-third of new claims in each of those months still hadn’t been paid within 70 days, forcing thousands of people to wait more than two months for aid to which they believe themselves entitled.

Ironically, it was the state’s implementation of a new system meant to modernize and streamline the delivery of unemployment benefits that prompted the meltdown. A confluence of factors emerged: The new system’s technology, which includes enhanced tools for fraud prevention, led to a steep jump in the number of issues flagged in claimants’ applications, and it took significantly longer for claimants to get hearings to resolve those issues, just as DUA staff underwent required trainings on the new platform that took them away from their normal duties.

The Healey administration kicked off the new system in May, featuring 140 new call center agents that drastically cut wait times and greater accessibility of the online portal through mobile phones and in multiple languages. The upgrades were one part of a larger, multi-year effort to update the unemployment insurance system and turn Massachusetts into one of the “top performing states” with “national leadership,” according to the Healey administration.

“DUA is committed to improving operations and communication with impacted workers and employers, and the launch of this new, modernized [unemployment insurance] system marks a major milestone in our efforts to serve customers,” Secretary of Labor and Workforce Development Lauren Jones, who oversees the state’s unemployment insurance system, said in a statement at the time.

But things quickly went awry.

A federal performance standard calls on states to aim for making at least 93 percent of initial payments within 35 days. At various times over the past three decades, Massachusetts dipped below that target, but never as sharply for as long a stretch as it did last year.

Last April, the state paid roughly three-fourths of initial claims within 35 days. In May, the month the new system went into effect, the rate dropped to 69 percent; by September, it had fallen as low as 42 percent, the worst single month on record in Massachusetts since 1997, the earliest year for which data is available.

Massachusetts was the slowest state in issuing initial unemployment payments in the country between June and October. The Bay State’s unemployment rate held steady during that period, while claims saw a modest increase that was far less dramatic than in previous years more affected by COVID-19.

Evan Murphy, a principal at Unemployment Tax Control Associates in West Springfield, described the situation as “a little bit of a perfect storm.”

UTCA is a third-party administrator that handles unemployment insurance on behalf of about 300 Bay State employers. On multiple occasions in recent months, Murphy said, his firm has interacted with former workers who were told by DUA that their case is stalled because the state is still waiting for an employer to provide more information.

“I can see in a lot of cases that we responded, like, a month ago with everything that they’ve asked for, and there’s nothing that is still due,” Murphy said in an interview. “I don’t know why [the state is] saying that, or if they’re buying themselves time, or whatever the case may be. It creates a strain on employers, and claimants don’t necessarily have a lot of answers, and I feel bad for them.”

The debacle led DUA to launch a three-month pilot program in August to close call centers on Fridays to allow workers to “process claims faster.” The state said the pilot has been successful, reducing issues associated with individual claims by nearly 58 percent, while staff at the same time handled double the amount of calls compared with the prior year. The state extended those call center changes in the pilot program through the end of March on account of its success.

The agency is also in the process of hiring 29 adjudicators and 150 seasonal employees to help process claims and staff the call center.

“DUA is committed to making sure eligible claimants receive payment as soon as possible because we know they rely on these funds to make ends meet and [to] provide support during times of transition,” Matt Kitsos, a DUA spokesperson, said in a statement. “Over the past several months, DUA recognized a drastic need to adjust operations to improve customer experience and process claims more efficiently, which led to the implementation of major initiatives and operational enhancements with significant progress underway. We know we have more work to do and we remain committed to doing so.”

Kitsos said the US Labor Department metrics themselves, while an important tool, may not “fully reflect the truth strength or health of an organization.” He said that while DUA was closer to meeting federal timeliness standards in early 2025, DUA was carrying a significantly higher backlog than it currently is, something not necessarily captured in the federal data, which only measures the timeliness of initial payments once that money goes out the door.

State lawmakers, having faced the wrath of their constituents over long wait times, remain on edge over the situation, though they largely have kept their concerns behind closed doors rather than flex oversight muscle.

Sen. Jacob Oliveira, a Democrat from outside of Springfield who co-chairs the Labor and Workforce Development Committee, told CommonWealth Beacon that “we’re not out of the woods yet” and he suspects upcoming hearings on the state’s annual budget will feature “tough questions” related to the unemployment benefits situation.

But lawmakers have not yet scheduled any hearings on the next budget debate, which Gov. Maura Healey will kick off with a proposal due later this month. Last year, the first budget hearing took place March 6; if Beacon Hill keeps that pattern again this time around, lawmakers wouldn’t get a chance to ask “tough questions” until roughly three-quarters of a year after the UI platform change that triggered the crisis.

“This new system was designed to support and make it easier for residents to actually get their unemployment claims processed, and when it was rolled out, it was not rolled out in a way that was acceptable,” Oliveira said.

But he said it appears the situation may be improving, pointing to fewer complaints from constituents in recent weeks. He also offered robust support for Jones, arguing that wait times have been too long for claimants for decades. (Data show that while the system has had periods of delays in the past, the tail end of 2025 was a historic low.)

The unprecedented breakdown is leading others, however, to question those in charge, and it could create an election-year headache for Healey.

“Making sure that people who lose their jobs get timely unemployment insurance benefits is a core public service,” said Evan Horowitz, executive director at the Center for State Policy Analysis at Tufts University, who previously served on the state’s special commission on the unemployment insurance trust fund. “It’s shocking that we are failing to provide it, and I can’t shake the sense that it reflects a real leadership failure at the agency.”

The Healey administration did not make Jones available for an interview upon request.

At the time of publication, Massachusetts remained the only state in a federal database without November first-payment timeliness statistics.

Kitsos said the Healey administration provided the relevant information to the federal government after some initial technical issues on the federal side, but can’t speak to why the federal database has not been updated to reflect the state’s data.

DUA officials also provided CommonWealth Beacon with additional data demonstrating the department’s performance at processing all claims, including denials. That’s a more detailed universe than the federal data, which captures only initial payments made in cases involving eligible applicants.

In July, about 47 percent of all claims — both those that were paid, and those that were denied — were processed within 21 days, DUA data show; by November, the share had risen to nearly 58 percent, reflecting some improvement.

Even before the latest problems erupted, unemployment insurance in Massachusetts had long been a source of discontent.

The state has had to contend with unemployment fraud, which soared nationwide during the pandemic and later specifically targeted Massachusetts in 2023, triggering extra security checks that slowed processing times for claims. A 2024 state audit also documented issues at DUA, including the payment of benefits to individuals while they were incarcerated.

More recently, the Trump administration cut $400 million in federal unemployment insurance funding for states. Kitsos, the DUA spokesperson, cited declines in federal funding and a rise in unemployment fraud nationwide as challenges, conceding that the launch of the new system presented a “learning curve” associated with new “workflows and expectations” for staff and claimants.

While the federal government funds the administrative side of states’ unemployment insurance programs, Massachusetts businesses fund the actual joblessness benefits in the state through taxes they pay. Those businesses have for decades lamented the high costs of providing that aid, which is arguably the most generous in the country.

A surge of unemployment early in the COVID-19 pandemic overloaded the system. Massachusetts borrowed money to ensure it could keep up with the record demand, and employers continue to owe hundreds of millions of dollars per year more to repay that balance.

Businesses are also preparing to be on the hook for another sizable debt. The Baker administration mistakenly used federal pandemic funds to cover unemployment benefits that should have been paid with state dollars. Healey last year announced a $2.1 billion settlement with the federal government that reduced what Massachusetts owes and spread the repayment out over a decade.

Healey pledged that businesses would not face higher unemployment insurance taxes as a direct result of the agreement through at least the end of 2026. That’s little comfort to many employers because, due to economic factors and the trust fund’s shaky outlook independent of any federal debt, employers are already facing a series of increases in the rates they pay, forecast to reach the maximum allowable level starting in 2028.

The governor last year said she would task Jones and her budget chief, Matthew Gorzkowicz, with convening a series of conversations about how to reform the system, but it’s not yet clear what — if any — action that will produce. Prior state efforts to build consensus for unemployment changes fizzled.

“[The Department of Unemployment Assistance] has been not run well, and I think part of that is because of some sort of philosophy – from Democrat and Republican administrations alike – that it does not have to be because it’s not funded by rank-and-file voters and taxpayers,” said Retailers Association of Massachusetts president Jon Hurst, who’s been closely involved in discussions about big-picture reforms. “Employers are taxpayers as well and deserve to have a well-run system.”

“Are we close to coming forward with a real plan of action? I’m not overly optimistic that will happen prior to an election, but hopefully, before taxes spike, particularly a year from now, a roadmap will be written,” he added.

The downturn in DUA’s performance in 2025 has been particularly sharp, and it isn’t limited to payment timeliness alone.

DUA is also dramatically below the federal performance standards for issuing “nonmonetary determinations” within 21 days of the date of detection of an issue that could impact a claim, like questions around how and why the claimant lost their job and whether the claimant is actively looking for work.

Though Massachusetts wasn’t meeting that benchmark even before the new system took effect in May, DUA’s ability to issue these determinations got dramatically worse after the fact. The feds say 80 percent of determinations should be made within 21 days; in October, Massachusetts made just 43 percent of one category of nonmonetary determinations within 70 days — achieving roughly half of the target in more than three times the duration. The raw number of another category of nonmonetary issues increased dramatically, tripling from just over 7,000 in April to more than 21,000 in October, the second-most on record in state history.

And the number of appeals pending a hearing decision more than quadrupled immediately after the new system was installed in May, according to Labor Department data. In April, DUA reported just shy of 2,000 such appeals. The next month, it spiked to 6,364 and reached over 8,000 in June before continuing to balloon to 9,631 in August — the most since January 2023.

“We remain deeply concerned by the ongoing delays claimants are facing when attempting to access unemployment insurance benefits,” Jason Salgado, a staff attorney at Greater Boston Legal Services, said in a statement, adding that “performance data and the challenges claimants continue to experience underscore the need for [DUA] to better understand, provide additional clarity regarding, and take more urgent action to address the root causes of these delays and barriers.”

The state’s program, experts said, is at legal risk due to its poor performance. Claimants could sue DUA, for instance, for failure to meet payment timeliness requirements.

That’s what happened in Alabama in 2022 after a lengthy unemployment upheaval there. After a long legal fight, a state judge threw out the case in October.

The US Labor Department could withdraw all funding for DUA for noncompliance, though that has never happened before to any state because of the catastrophic consequences that would result, said Amy Traub, a senior researcher and policy analyst at the National Employment Law Project.

DUA said the Labor Department has not issued any warnings or threats with regard to how it has administered unemployment insurance benefits in recent months. But the agency has reached out to the feds for “technical assistance on how states are expected to meet timeliness standards while still taking the necessary measures to prevent and detect fraud and have also adequate investigation time to ensure proper pay,” said Kitsos, the spokesperson.

Both the political and administrative battles over the state’s unemployment system could continue into 2026 as Healey advances her reelection bid.

Even though DUA is encouraged by recent data showing improvements in November, there’s concern that any reprieve could be short-lived if underlying issues with the new system persist. Unemployment claims nationwide, including in Massachusetts, regularly climb in the winter months.

Then there’s the longer-term outlook. Even if nearly all checks started flowing out on time once again, the system would still face the long-term deficit exacerbated by the Baker administration’s mishandling of federal pandemic funds.

Any attempt to rebalance it could prove politically toxic because unemployment reforms are, essentially, a zero-sum game: Most changes that would be more favorable to the employers who fund jobless aid would be less favorable to the out-of-work Bay State employees who need the benefits like Russo, who is still reeling from her inability to receive unemployment insurance for nearly half a year.

“[This] is costing employers, and at the same time, you’re finding out that the claimants aren’t being paid timely,” said Murphy, the unemployment insurance third-party administrator. “The system is just not really working for any of the stakeholders.”