Unemployment benefits: Supreme Court says these workers can sue over delays
State labor departments are supposed to issue most of the of first payments for unemployment benefits within weeks. But there rarely are penalties.
WASHINGTON – Alabama residents who faced extreme delays in trying to file for unemployment benefits can seek help from state courts, a divided Supreme Court ruled Friday.
The justices overturned the Alabama Supreme Court’s decision that state law requires an administrative appeals process be completed first before suing.
Writing for the 5-4 majority, Justice Brett Kavanaugh said in the case's "unusual circumstances," the state Supreme Court was effectively immunizing the Alabama labor department from lawsuits.
“In essence, Alabama has said that to challenge delays in the administrative process…you first have to exhaust the administrative process,” Kavanaugh wrote. “Of course, that means that you can never challenge delays in the administrative process.”
Four of the court's conservative justices − Clarence Thomas, Samuel Alito, Neil Gorsuch and Amy Coney Barrett − dissented.
'No authority to interfere with Alabama's choice'
Writing for the minority, Thomas said Alabama's exhaustion requirement promotes "judicial efficiency."
"We have no authority to interfere with Alabama's choice," he wrote.
The U.S. Chamber of Commerce and the American Civil Liberties Union were among the groups that opposed the state court's decision, concerned it would make it harder to mount a challenge to state actions that hurt businesses or violate civil rights.
The Alabama residents had argued they wouldn’t have needed to sue if the administrative appeals process was working in the first place.
Kavanaugh wrote the residents were correct to argue they faced a “catch-22” situation.
State labor departments are supposed to issue 87% of first payments for unemployment benefits within two-to-three weeks. Alabama has regularly fallen below that standard and also has one of the worst rates for processing appeals in a timely fashion.
Fight started with an Alabama shrimper who was denied benefits during COVID
Derek Bateman, an independent shrimper in Alabama, spent months trying to appeal after being denied benefits during the COVID-19 pandemic. He said he finally received some of what he was owed nearly two years later, after having “lost everything” and struggling to keep from going hungry.
Legal Services Alabama, a legal aid group, sued Alabama on behalf of Bateman and other residents under a federal civil rights law, Section 1983. They wanted the state to be forced to “promptly” make decisions on unemployment benefits and to schedule requested hearings within 90 days.
"What we're trying to do is get the state agency to give us hearings and give us adequate notice," Adam Unikowsky, who represented the residents, told the court during the October oral arguments. "And what the state court said is that because you didn't exhaust those remedies, precisely because we didn't get the hearing and the notice, you can't bring your claim."
But the state said the system was overwhelmed during the pandemic and that’s not a reason for bypassing the normal administrative process. They argued that would be like allowing a plaintiff to go straight to an appeals court before the trial court weighs in. And the labor department hearing officers who review the appeals have the necessary expertise, the state’s lawyers said.
Asked during oral arguments how Alabama has been addressing the delays, Alabama Solicitor General Edmund G. LaCour, Jr. said the state has tripled the number of employees handling appeals, from eight to 25.
The number of Alabamans waiting at least 21 days for a hearing has been reduced from more than 131,000 in January of 2022 to about 7,410 in October, he said.
In March of 2021, the month Bateman was first able to get through to someone in the unemployment office, the average wait time for an appeal was 263 days, according to federal data analyzed by The Century Foundation, a progressive think tank.
If a state isn’t meeting timeliness goals, the federal government can revoke grants it sends to help states run their programs. But experts say that doesn’t happen because cutting states’ resources will make responsiveness worse.
The case is Williams v. Washington.