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Ohio Unemployment Has Spent $105M on Call Center Contracts

The Department of Job and Family Services hired five companies to contract call center workers to better handle the mass of pandemic-related unemployment claims. Some call center workers were initially paid $59 an hour.

(TNS) — Ohio’s unemployment system says it has spent nearly $105 million to outside contractors for workers to help field a tsunami of phone calls from an unprecedented number of Ohioans who filed claims during the coronavirus crisis.

During the initial months of the pandemic in 2020, the Ohio Department of Job and Family Services signed call-center-related contracts with five companies that, to date, authorized spending of more than $200 million, according to documents provided by the department. However, ODJFS didn’t fully utilize the contracts: as of last Friday, only $104,688,988.22 was actually spent by the department on call-center staffing, according to department spokesman Bill Teets.

Most of that money – about $63.5 million – was paid to Deloitte, one of the world’s largest professional services firms, to provide call-center staffers for up to $59 per hour for each agent, according to Teets and ODJFS’ contract with the London-based company. In the Deloitte contract, ODJFS also agreed to hire a handful of supervisors for even higher amounts.

ODJFS also paid four other companies to provide call-center agents, according to Teets:

• Direct Interactions Inc., which was paid about $31.1 million

• Protiviti Government Services, which received about $6.8 million (Proviti used a subcontractor, Robert Half, to provide the staffers)

• Insight Global, which got more than $3 million

• Conduent State & Local Solutions, which was given about $301,000

Two of those companies — Direct Interactions and Conduent — still provide a total of about 450 unemployment call-center workers, some of whom work part-time, according to Teets. Deloitte’s contract expired at the end of last year; Protiviti and Insight Global have active contracts but aren’t currently providing any call-center workers to ODJFS, Teets stated.

Of the nearly $105 million paid to these firms, about $101.3 million was paid for using federal coronavirus relief money, according to Teets. The remaining $3.7 million came from the state of Ohio, he stated, to cover “a small gap while awaiting federal funding.”

ODJFS representatives say the contracts have been necessary to help deal with the influx of millions of calls from Ohioans with questions and problems with their jobless benefits, including special pandemic unemployment assistance benefits from the federal government.

During the first four weeks of the coronavirus crisis in the spring of 2020, as many businesses were closed, a record 855,000 unemployment claims were filed – more than were filed in the previous two years combined.

At its peak, ODJFS’ call center had 1,932 agents, about 85 percent hired through contractors, according to Teets.

Today, the number of people contacting the state’s unemployment call center is only a fraction of what it was in 2020. One reason is that the additional federal coronavirus unemployment benefits ended last September; fewer Ohioans have also been filing traditional jobless claims recently, as many companies are struggling to find workers.

Deloitte spokeswoman Karen Walsh, previously said in a statement that the amount of money it bills ODJFS for the workers doesn’t all go toward their salaries. The company keeps a portion of what it bills per hour to cover the costs of recruiting, training, deploying, managing, and supervising them.

The cost of Deloitte call-center agents has dropped since the initial days of the pandemic: from $59 per hour in April and May of 2020, to $55.80 per hour between June and December 2020, to $36 per hour during the first six months of 2021, according to copies of contracts provided by ODJFS. In all, between April and December 2020, ODJFS agreed to pay more than $30.6 million for these workers, according to the contracts.

State officials also agreed to pay Deloitte $250 per hour for a full-time operations and oversight manager and an additional $250 per hour for each member of a six-person team to train new agents quickly, according to the contracts. Under a contract signed with Deloitte last January, ODJFS agreed to pay $110 per hour for a quality-assurance manager and tech support personnel, as well as $60 per hour for quality auditors and a lead trainer.

Other contractors charged less money for their call-center workers: Insight Global charged $25.70 per hour for each agent it supplied, while Direct Interactions charged between $26.50 and $27 per hour, depending on how many workers it deployed to ODJFS’ call center.

Call-center agents hired by ODJFS directly are paid an average of $19.72 per hour, according to Teets. But when benefits are included, he stated, that number increases to $33.56 per hour on average, and state-hired agents working overtime make an average of $50.34 per hour in salary and benefits.

“Considering that price differential, the flexibility associated with contract staffing, and the desire not to create permanent state employees that would later need to be removed for lack of work, you can get a better idea of the rationale behind their use,” Teets said in a statement.

He added that ODJFS’s goal is to end all of its call-center contracts by this spring and only use state workers in its unemployment call center beyond then.

In addition to the money spent on call-center workers, Teets said, ODJFS has also paid about $10.6 million to a sixth company, Ireland-based Accenture, to handle various managerial tasks, such as developing and coordinating training plans for call-center workers, predicting how many call-center agents would be needed in the future, and evaluating ways to improve the call-center system.

©2022 Advance Local Media LLC. Distributed by Tribune Content Agency, LLC.
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