Cabinet Officials Defend Hiring, Firing Of Unemployment Director

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Cabinet officials defended the hiring and downplayed the firing of the executive director of the Office of Unemployment Insurance at a legislative hearing Thursday. 

As KyCIR first reported Monday, the executive director, Muncie McNamara, was quietly fired in early May amid a mounting unemployment crisis caused by the coronavirus

McNamara was a campaign donor and friend of Lt. Gov. Jacqueline Coleman; she personally called to offer him the job running the Office of Unemployment Insurance in January. 

Josh Benton, the deputy secretary for the Cabinet for Education and Workforce Development, defended that hire to the legislative Program Review and Investigations Committee Thursday. 

“We felt that he met the qualifications for the job, there’s no doubt about that,” he said.

Sen. Danny Carroll, a Republican from Paducah, asked whether any of the delays in providing jobless benefits can be traced to McNamara’s inexperience on the job. 

“Every state has had complications. Every state has had frustrations,” Benton said. “So to fully lay that at any one person’s feet would be unfair.”

Benton described an agency thrown into chaos as unemployment claims skyrocketed amid the pandemic-related shutdowns. The agency went from processing a few thousand claims a week to hundreds of thousands, and the size of the agency’s staff ballooned as employees from other parts of state government came to help out.  

Legislators also questioned Benton — as well as Labor Secretary Larry Roberts and general counsel Amy Cubbage — about the contract the state gave Ernst and Young to help process claims. The $7.6 million no-bid contract is set to expire in three days, though Cubbage said they are considering extending it because the workers are already trained in the system. 

Benton and Cubbage also addressed a data breach that was first identified at the unemployment office in late April, which was not reported to the proper authorities until nearly a month later. Gov. Andy Beshear called for the Office of the Inspector General at the Transportation Cabinet to look into the incident, and Cubbage said that report is expected any day, but that it seemed likely the failure to report the breach came from within the legal department.  

Benton said the issues facing the Office of Unemployment Insurance were much larger than any one person. 

“It was going to take our agency, or any agency, a significant amount of time to stabilize operations to meet the demand,” Benton said. 

He did not offer further explanation about why McNamara was suddenly fired on May 5, citing an ongoing Personnel Board action. 

McNamara filed an appeal with the personnel board claiming he was fired after raising a number of concerns about the cabinet’s handling of the unemployment program. Those concerns include issues of data security, conflicts of interest, a lack of clear guidelines and standards, compliance with federal regulations and concerns about the management of the unemployment trust fund.

Records show he was fired “without cause” and the Cabinet for Education and Workforce Development told KyCIR those allegations did not factor in his firing.

Benton’s recounting of events was more neutral than that of his boss, Gov. Andy Beshear. In a press conference Monday, Beshear described a much more fraught situation, calling McNamara’s departure “emotional” and “messy.”

“Certainly with it being messy in the end, I think everybody wishes the situation either hadn’t happened or turned out how it did,” Beshear said.

Contact Eleanor Klibanoff at eleanor@kycir.org. Contact Jared Bennett at jbennett@kycir.org.