Two attorneys in Ohio filed suit today to compel Governor Mike DeWine to restore the state’s participation in several federal unemployment programs. One of these programs, Federal Pandemic Unemployment Compensation (FPUC), provided an extra $300 a week in unemployment aid to eligible workers. The case follows temporary injunctions issued after similar lawsuits were filed in Indiana and Maryland.
Ohio is one of 27 states, mostly led by Republicans, that announced plans to stop participation in FPUC and cut off the additional $300-a-week benefit to residents. DeWine, along with Matt Damschroeder, the Director of the Ohio Department of Jobs and Family Services, declared on May 13, 2021 that Ohio would end the $300 benefit on June 26, more than two months earlier than the program’s official expiration date of September 6, 2021. “When this program was put in place, it was a lifeline for many Americans at a time when the only weapon we had in fighting the virus was to slow its spread through social distancing, masking and sanitization,” DeWine said back in May. “That is no longer the case.
However, the lawsuit filed today challenges that assertion arguing that DeWine’s move “represents a willful and blatant violation of Ohio law,” in addition to “jeopardizing the personal and financial well-being of Ohioans who are struggling to recover from the pandemic.” Marc Dann and Brian Flick, the two lawyers who sued Ohio, argue that state law is clear and that the state must accept the benefits from the U.S. Department of Labor. Specifically they pointed to Ohio Revised Code Section ORC 4141.43(I), which requires the state to “…cooperate with the United States department of labor to the fullest extent…[and] take such action…as may be necessary to secure to this state and its citizens all advantages available under the provisions of the Social Security Act that relate to unemployment compensation…” "Unless the legislature changes the law, they need to accept these dollars and pass them on," Dann said.
Dann and Flick cited the recent preliminary injunction by a judge in Indiana that compelled Governor Holcomb to continue paying benefits. In that case, Judge John Hanley ruled that Indiana’s decision to cut off the $300 benefit prematurely violated state law. Hanley said that withdrawing from the federal program put Governor Holcomb and Indiana Department of Workforce Development Commissioner Frederick Payne, “in violation of their statutory duties.”
“Indiana’s statutory language is very similar to Ohio’s,” Dann noted. “We believe we are right on the law and absolutely right as it relates to public policy.”
The lawsuits come as the U.S. economy shows signs of recovery with employers adding 850,000 workers to payrolls in June. With 27 states ending, or attempting to end, the extra $300 weekly federal benefit, there will be natural experiments to show whether this is the impetus of the labor shortage in the country. While too soon to form conclusions, it’s noteworthy that “in the 4 states that ended the weekly top-up on June 12, claims for state UI actually rose 3.7% from 6/12-6/19 — even as claims in the other 47 states were only up 1% that week,” noted Andrew Stettner, a Senior Fellow at Century Foundation.
If these trends hold up, perhaps its time to ask the governors in states that are ending benefits early what else they are planning to do to reduce the labor shortage in their states?
