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El Aguascalientes on Wadsworth Boulevard in Wheat Ridge has signs thanking its customers and advertising take-out options. Signs of COVID-19 and its effects on bars and restaurants are visible around the metro area on December 16, 2020 in Denver. (Kathryn Scott, Special to The Colorado Sun)

As the first federal unemployment payments hit some bank accounts in Colorado this week, a number of unexpected problems emerged, prolonging the wait for thousands who have already been waiting for more than a month. 

And for everyone else unable to participate in this first round, the re-entry date for Phase 2 still appears several weeks away. 

The start of Phase 2 is the “question of the day,” Cher Haavind, deputy director of the Colorado Department of Labor and Employment, said during a call Thursday with journalists. “We had hoped by the end of the month and so we will certainly circle back with everyone when we have a firm date on that.”

As the labor department prepped the system to start paying the $300 in federal benefits last week, 10,989 Coloradans filed for unemployment for the first time. The state paid $20.2 million in benefits for the week, which ended Jan. 30. About 70,000 were collecting regular unemployment benefits as of Jan. 23. 

This week’s figures will surely rise. Over the weekend, the state invited 230,000 people who had unused pandemic benefits in December to return this week. Everyone’s pandemic benefits ended Dec. 26 with the CARES Act. The new Continued Assistance Act was approved the next day, but it’s taken five weeks and counting for the state to reprogram its system to pay out the $300. Since Saturday, the state has paid $216 million in benefits.

But another large group on pandemic unemployment has been out of luck. They exhausted their benefits last year and must wait for Phase 2. If it doesn’t start until the end of the month, that means many of them haven’t received a payment for two to three months.

Officials said they are still dealing with issues in Phase 1, which allowed those who hadn’t used up their pandemic benefits from last year to return to the system on Monday. 

“As systems issues are identified this week, the vendor has been very responsive (and) most often deploys fixes to some of the problems we’ve identified overnight,” said Joe Barela, executive director of the Department of Labor. “Some of the problems include removal of erroneous payments on approximately about 1,900 claims and self-employment issues that were holding up the release of PUA benefits, those have been resolved.”

One issue affected an untold number on Pandemic Unemployment Assistance. Their claims were denied this week because applicants agreed to a confusing statement that their unemployment claim was not due to COVID, even though it was. 

Officials admitted Tuesday that the question was worded poorly and had changed from last year’s series of questions because of a new requirement by the U.S. Department of Labor, said Phil Spesshardt, acting director of the state’s Unemployment Insurance Division. He didn’t say how many people were affected, but said it was enough that changes are being made. 

The current wording is “I am no longer unemployed as a result of one of the above COVID related reasons.”  

The plan is to reach out to those users who were disqualified and allow them to correct their answer. The state also said it will frame the question differently to alert users to read it carefully. The question also will be moved to the end of the series, and there will be a bold font with instructions in parentheses on how to answer. They also advised users to allow pop-ups when viewing their claims on a computer and check their mobile devices in case pop-ups were suppressed.

“This change will be made before the end of the week,” Jessica Hudgins Smith, the Division of Unemployment Insurance press secretary, said in an email.

Payment holds

Another issue affecting many who have reached out to The Colorado Sun were payment holds. Some of these were clearly marked for users as “integrity” holds, which indicate the account was flagged for fraud. But others said nothing more than “hold.”

Those with “integrity” holds must verify their identity using the new IDme tool, which requires visual proof of one’s identity. To get access to the tool, one must either call 303-536-5615 and request access to IDme, or they can now fill out this form online.  (“Filling out the form will push their claim through the process of getting their hold lifted without having to call in,” Smith said.)

So far, the state has sent IDme links to 28,000 people who had reached out for help, Barela said. Of those, 7,600 completed the process and their holds were lifted. Those who do not complete the IDme process won’t get the hold lifted.

“We’ve released and paid over $4.8 million to those legitimate claims,” Barela said. “We’ve been sending about 2,000 to 5,000 a day. We are going to ramp up that to 15,000 a day to get to all the fraud holds.”

The state also plans to start reaching out to “about a million” users on fraud holds who have not asked for help.

But not all holds are fraud holds, Spesshardt said.

Certain responses can trigger a hold. If a person says they’re not “able and available for work,” that could trigger a hold that the state must investigate. Another example comes from those on PUA and are self-employed. When asked if they’re involved in self-employed activities, saying “yes” can also create a condition that puts a hold on the payment.

“Obviously, it makes no sense on the PUA side that that’s holding up payment because that’s the very reason those individuals have a PUA claim,” Spesshardt said. “So those are also ones that we’re continuing to work on to be able to void out or remove those issues to remove those payment holds.” 

MORE: Unexpected issues continue to plague Colorado’s unemployment system


Another issue that showed up this week affected a group of unemployed people who were overpaid last year and had the extra sums forgiven last year, after the state deemed the PUA application too confusing. But the demand for repayment returned on their claim this week. 

The state took a look at several cases and was able to fix a number of them, Spesshardt said.

“Those were written off and, for some reason, when … preparing for Phase 1, all of a sudden those overpayments showed up again,” he said. “Last night,  the vendor removed over 1,900 of those types of overpayments for individuals. That is not to say that every overpayment that was previously written off was within that group.”

He said he’s already seen other claims that were missed and will continue to work with users who report the overpayments. 

MORE: Colorado won’t try to collect the $1.4 million in overpaid unemployment benefits it distributed after all

The call center

Each new Phase 1 problem created a surge to the call center, which was already swamped by this week’s federal benefits rollout. Between Monday and Wednesday alone, there were 11,000 calls to get through to the call center, staffed by 440 customer service agents.

But not all calls even made it into the queue. A person named Amy emailed The Sun that she called 200 times starting on Tuesday and finally got through on Wednesday. She was on hold for 2 hours and 15 minutes “until the system hung up on me.”

“I’m frustrated, scared to be homeless, and too broke to even think for more than a minute or two,” she wrote. “While I’m extremely grateful to have unemployment at all, I feel like no one in the government of Colorado or our nation’s Capitol really understands. Do they think about what it’s really like to be in this situation? I feel this way because I’ve been waiting since December and I cannot get through on their phone line after two solid days of trying to reach them.” 

The Department of Labor directs those with questions to call 303-536-5615, a number that last year was reserved for those on Pandemic Unemployment Assistance, the federal benefit for gig workers and the self-employed. It’s now for anyone with questions on the new MyUI+ computer system, which both PUA and regular unemployed people are now using.

The 303-318-9000 is the alternative regular unemployment number.

Because of the problems, the agency is adding 100 new call-center agents who are in training and should be answering calls within the next week.

“We know the call-center access has been an issue and we’re doing everything we can to make sure that people have access,” Barela said. 

He also pointed out that the main questions have been asking about the different phases of the federal benefits rollout, holds and about weeks denied. 

“I really want to stress it’s so important that claimants access (because) the majority of their answers to the questions on phase eligibility as well as holds, the ability to fill out a Google form and get that hold taken care of, is all there,” he said.

He also advised users to call their local workforce center for help (here’s a list of workforce centers in Colorado). 

There is information on the labor department’s website about the phases. For example, people who could reopen their claim this week because they had a balance from last year, would move to Phase 2 after exhausting that leftover balance. The second phase is also for new PUA claimants and for people who need extended benefits for the first time.

And those with claims showing weeks denied may just need to wait until later in the day or the next day. “Although weeks may show denied immediately, the system may take some time to complete the process to generate correspondence. New correspondence is generally available after 6 p.m.,” the site says.

Read more Colorado Sun stories on unemployment

Tamara writes about businesses, technology and the local economy for The Colorado Sun. She also writes the "What's Working" column, available as a free newsletter at Contact her at,...