The State Worker

Chronicling civil-service life for California state workers

November 25, 2008
Nepotism at the Unemployment Insurance Appeals Board

Last week's state audit of the Unemployment Insurance Appeals Board proves that old saw that rules are made to be broken.

It's hard to know where to start. Bee reporter Andrew McIntosh's story on the audit nailed the conflict-of-interest concerns raised by the report. The Sacramento County District Attorney's Office and the state attorney general's office are looking into the matter. Somebody may be going to jail.

But let's talk about another aspect of the audit, the part that covers "familial relationships and employee favoritism."

We get calls and e-mail blasting this sort of thing all the time. Retirees holler about it years after they've been out of state service. "Families control entire branches of state government," a retiree told us a few months ago. "It's like the Mafia!" We don't remember his name, but we remember the quote because it stuck us at the time as an extreme overstatement.

Now we wonder.

Let's start with a few numbers on page 27 of the 63-page report:

"Employees responding to our survey provided the names of 94 colleagues who were allegedly related to another employee. Those 94 names equate to nearly 15 percent of the 646 individuals who were employed by the appeals board as of April 2008."

That's just counting immediate family relationships, the auditor said. "Because ... we did not ask them to identity all known familial relationships, there could be other familial relationships within the appeals board that were not reported."

According to the auditor's survey, 45 percent of appeals board employees who responded to the questionnaire believed that hiring and promotions were sometimes or often compromised by family relationships or employee favoritism.

And who knows what the numbers would have looked like if more board employees had responded? Auditors looked at 355 responses. What about the other 300 employees? Did they fear retaliation if their responses leaked out? (Auditors screened the responses by using employees' work e-mail addresses, which may have made some folks jittery.)

Maybe many of those folks didn't chip in their thoughts because they figured that this was going to be yet another state audit with lots of thunder and no rain.

The State Auditor is great for giving news grinders like us plenty of fodder.But when it comes to producing results, it's a decidedly mixed bag.

The auditor can criticize, make recommendations and occasionally refer the worst sinners to law enforcement officials. Beyond that, its greatest power seems to be embarrassing the audited. For proof, see its January audit of responses to audits: "Recommendations Not Fully Implemented After One Year."

We're planning to write about this topic for our Thursday State Worker column. Want to weigh in on the record? Contact us at (916) 321-1043 or We'd love to hear from that disgruntled retiree.

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About The State Worker

Jon Ortiz The Author

Jon Ortiz launched The State Worker blog and a companion column in 2008 to cover state government from the perspective of California government employees. Every day he filters the news through a single question: "What does this mean for state workers?" Join Ortiz for updates and debate on state pay, benefits, pensions, contracts and jobs. Contact him at (916) 321-1043 and at


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