Caltrans overpaid thousands of workers $1.5 million and didn’t recoup the money, audit says
The California Department of Transportation cost taxpayers $1.5 million by failing to collect overpaid wages it made to retiring and departing workers, according to a state audit released Tuesday.
Caltrans could have lost as much as $2.9 million had the auditor not intervened, the report found.
The money went out to employees preparing to separate from civil service, either through retirement or for another job.
When employees resign, state law and collective bargaining agreements require California agencies to give the workers their last paychecks within 72 hours. A similar rule, known as salary advances, exists for the current workers who fail to receive their paychecks on time.
Caltrans uses its own fund to pay those workers and then recoups the money from the Controller’s Office.
But Caltrans’ estimate may be different from that of the Controller’s Office. The Controller’s Office’s payments to Caltrans can also be mistakenly forwarded directly to the workers, the audit found.
Caltrans has three years after making those mistakes to notify the workers and request them to repay the money. But the department has failed to do so in thousands of cases, according to the audit.
Caltrans was aware of the problem as early as 2016, the report found. But the department often failed to notify the workers. It was only when the auditor’s office wrote to Caltrans in July that the department took significant action, according to the audit.
“Inefficiency and incompetency in Caltrans’ division of human resources (HR division) contributed significantly to the amount of overpayments Caltrans made and to its failure to notify employees and collect on the outstanding salary advances,” the California State Auditor’s office wrote in its report. “This resulted in some employees essentially being paid twice.”
As of 2020, Caltrans needed to collect $5 million — $1.5 million of which was rendered uncollectable because of the failure of the agency to notify its workers. Five other large state agencies combined needed to collect $1.6 million, according to the audit.
In its response, Caltrans said it has begun improving its process, such as by creating a centralized place to track its salary advances and notifying workers of the overpayments electronically.
The agency has doubled its collection efforts in the current fiscal year, and has provided cell phones and laptops to those involved in collecting the overpayments, Caltrans said in its response.
This story was originally published May 25, 2021 at 1:35 PM.
