There’s hope for the unemployed seeking to reclaim federal benefits

Favorable court decisions in three states could be a sign of hope for unemployed Floridians seeking to reinstate federal benefits cut off by the administration of Gov. Ron DeSantis.

In a lawsuit filed last week, 10 unemployed workers in Broward County alleged DeSantis and Dane Eagle, director of Florida’s Department of Economic Opportunity, stopped the flow of benefits from Washington “for purely partisan and political purposes.”

Moreover, the lawsuit alleges, they lacked the authority to cut off the federal program that added $300 in weekly benefits to the state’s unemployed. The workers want Florida to reinstate the flow of federal money — which was cut off in late June — saying they can’t pay their bills without it.

In separate cases in Arkansas, Indiana and Maryland, state court judges have already ordered their unemployment insurance agencies to resume participation in the federal program. Other lawsuits demanding reinstatements are pending in Ohio, Oklahoma and Texas.

The financial stakes are high. A recent study by the Century Foundation, a progressive think tank based in Washington, D.C., estimated that 417,000 workers were affected by Florida’s decision to stop the money.

The American Rescue Act extended the $300 federal payments until Sept. 6, but Florida joined 25 other states to halt the benefits early. DeSantis and other state officials argue the benefits have discouraged Floridians from going back to work.

Attorneys for the Broward workers are seeking an emergency injunction to force the DEO to resume $300 in weekly payments, as well as retroactive payments since June 26.

If a judge only ordered the state today to resume payments going forward, Florida workers could receive five weeks of aid totaling $600 million, said Andrew Stettin, a senior fellow at the foundation. If the cutoff continued for another week, the workers would receive four weeks, or $500 million.

In the Florida case, any restoration of the federal funds may well rest on how the judge weighs the state law against the voluntary nature of an agreement between the DEO and the U.S. Department of Labor. The agreement allows a state to walk away from the money if it gives the federal government 30 days’ notice.

“Those cases are based on obligations under state law,” said Jenna Gerry, senior staff attorney for the National Employment Law Project. “All 50 states have their own unemployment laws. But they generally follow a pattern. What most of these state laws have is a public policy provision where it recognizes it is important for states to take care of unemployed workers.”

And that means state law carries the argument, said Stettin of the Century Foundation

“The state law says to the government, ‘you are supposed to participate in these things.’” Stettin said. “In the three states, the judges have cited that.”

In Arkansas, Judge Herbert T. Wright Jr. acknowledged the federal programs “are clearly voluntary.”

But he said the power of deciding whether to participate is grounded in laws passed by the Legislature, not with the governor and his director of Workforce Services.

In his order, Wright noted that the law calls for cooperation “to the fullest extent” with the U.S. Department of Labor when the state seeks help for its unemployed citizens.

“The clear meaning of Arkansas law in this regard is that the state is to participate in these types of programs for the benefit of its citizens,” he wrote.

Scott Behren, one of three attorneys representing the unemployed workers in Broward, said Florida’s unemployment law largely reflects those of the other states.

“I haven’t compared them word for word, but they’re very similar,” Behren said. “Even if you look at the Arkansas ruling, the statute [the judge] quotes is very, very similar to the one in Florida.”

The Broward workers who sued say they need the financial bridge while they look for work.

Heather Fulop, a registered nurse who was laid off by a hospital during the pandemic, has young children to care for and can’t pay her rent and utilities with the state’s maximum weekly payout of $275, one of the nation’s lowest, according to the lawsuit.

“Based on her financial situation and the cutoff of federal benefits, she now fears losing her home,” the lawsuit says. “She is not lazy. She has worked since she was fourteen years old.”

Lori Beth Ertel, a self-employed accountant for small businesses that fell on hard times, said she is having a hard time finding work. When she applied at McDonald’s, she was told she was “overqualified” and unlikely to stay when the economy improved, according to the suit.

Florida “in a very different place”

But Florida officials insist the state’s pandemic economy has progressed beyond the point where the federal aid is needed.

“This federal jobless benefits program was never intended to be permanent,” Christina Pushaw, press secretary for the governor, said in an emailed statement. “It was always intended to support people who had lost their jobs due to business closures during the pandemic. Now that Florida businesses are open and there are hundreds of thousands of job openings, we are in a very different place from where we were when that program was first introduced.”

And Andrew Nixon, spokesman for the DEO, said the state withdrew from the program “due to positive, record-breaking economic factors.”

“For 14 consecutive months, Florida has continuously gained jobs, with more than 907,900 jobs added since the height of the pandemic,” he said. “Additionally, there are more than 520,000 job postings currently available across Florida.”

Economists see even lower jobless rates by 2023. The state rate — which was 7.9% in 2020 — will fall to 4.3% this year, to 3.5% in 2022 and to 3.3% in 2023, said Sean Snaith, who directs the University of Central Florida’s Institute for Economic Forecasting.

“We’ve already seen a significant reentry back into the labor market after those additional benefits were cut off,” he said. “Certainly when the shutdowns were in place, and if you were a server or bartender who lost your job, there was no place to go to find another.”

To others, the picture is less clear.

A spokesman for CareerSource Broward, one of two dozen job search agencies around the state, said its customers seek help “for a variety of reasons” such as job loss, a search for better jobs, professional development workshops or career training.

But Andrew Zelman, a labor and employment lawyer with the law firm of Berger Singerman in Fort Lauderdale, said the improvement in Florida’s economy may work against the DeSantis administration’s argument that the federal benefits are a drag on the workforce.