Around 9,000 recipients of Pandemic Unemployment Assistance (PUA) who received $1.4 million in overpayments won’t have to pay it back, the Colorado Department of Labor and Employment said Thursday.

In a press call, CDLE Deputy Executive Director Cher Haavind said the identified recipients were overpaid as a result of the confusing system or display significant financial hardship.

Prior to the announcement, hundreds of Coloradans were notified by CDLE, saying they had been overpaid in unemployment benefits and would have to pay the money back.

The state estimated there was over $40 million in PUA overpayments, most of it due to fraud.

A focus group was established by CDLE to look into the overpayments. It concluded that confusion in the PUA filing process regarding how workers report their wages resulted in many overpayments.

Of the 9,000 identified recipients who were deemed not-at-fault, the majority were gig works and self-employed people.

Officials said the workers’ unfamiliarity with the filing process resulted in over-reported earnings.

Many of the overpayments identified were because the workers reported their gross income rather than their adjusted income, or reported the same earnings in more than one section.

CDLE also blamed the confusion on the fact that PUA was modeled after an existing program designed for self-employed people and independent contractors, meaning it was created to use specific documentation for traditional self-employed workers, not app-based workers.

Remaining offset balances will be written off on Oct. 28, officials said.

Those who were overpaid and are not receiving the write-off can file an appeal for the state to reconsider. The window for appeal has been extended from 20 days to 180 days to address the form confusion.

Those who do have to repay can request a payback schedule or have some of the overpayment taken out from future benefits.

People who are already on a repayment plan can also appeal and get the funds back.

The CDLE focus group is working to update the PUA Monetary Wage form to make it more clear. The updated form will be available on the PUA application on Oct. 29.