New unemployment claims in Louisiana recovered after an unexpected spike.

A group of unemployed Louisiana residents filed a lawsuit Friday night challenging Gov. John Bel Edwards’ decision to stop accepting the federal $300-a-week boost to jobless benefits, arguing that the move violates state law and asking the courts to reinstate the payments immediately.

Louisiana on Saturday ended its participation in three of the federal government’s pandemic unemployment programs, cutting off jobless benefits for more than 150,000 residents and slashing payments in half for thousands more who remain out-of-work amid a worsening COVID-19 surge. 

The benefits were made available by Congress until Sept. 6, but Edwards, a Democrat, ordered Louisiana to stop accepting the federal payments effective July 31 in exchange for support from GOP lawmakers and business groups for a permanent $28 hike to the state’s weekly unemployment benefits, beginning in January 2022.

The lawsuit asserts that Edwards’ decision violated state unemployment statutes, which compels state officials to secure available federal unemployment compensation for their jobless citizens.

That argument mirrors those made in lawsuits lodged in several other states where federal payments were cut off early — including Indiana and Maryland. Judges there recently ordered the federal jobless benefits be reinstated. 

Nearly 86,000 residents who make their living in Louisiana as self-employed contractors, musicians, tour guides and gig workers are set to lose their benefits. Another 65,000 residents who have exceeded the state’s 26-week-long limit on unemployment benefits are also getting the boot, according to data from the Louisiana Workforce Commission.

For the 35,000 residents who will remain on unemployment rolls, weekly checks will be cut in half – as Louisiana joins 25 Republican-led states that have rejected the $300 supplemental payments under pressure from business groups who argue the payments are discouraging employees from returning to work.

The lawsuit's plaintiffs include six women from across the state who have faced hardships from the pandemic and were relying on the next five weeks of federal payments to keep them and their children from experiencing poverty, homelessness and hunger, according to affidavits submitted to the court. 

Courtney Rae Cook, a plaintiff who lives in St. Bernard Parish, was laid off from her job as a bartender in the French Quarter after the pandemic caused tourism in New Orleans to plummet. When her employer re-opened, they were only able to hire a limited number of staff, and Cook was not included. 

Without the remaining five weeks of benefits, Cook won’t be able to pay her electric bill, and even with the payments, “she is barely able to purchase back to school supplies and clothes for her children,” according to the lawsuit.

Cook has continued to apply for jobs – as is required by state law to receive benefits – but isn't having much success. 

“More recently, some employers have called Ms. Cook to inform her that with the new spike in COVID, they are waiting to hire, because they don’t know if they will be shut down again, or if they will have enough customers,” the lawsuit states.

Hours after the lawsuit was sent to the 19th Judicial District Court in Baton Rouge, Cook was hospitalized with COVID-19, said Wendy Manard, an attorney in New Orleans, who filed the lawsuit with her colleague Ellyn Clevenger and state Rep. Mandie Landry, D-New Orleans. 

"There’s going to be a lot of people who contract COVID and they’re not going to have any benefits and they're not going to be able to go to work," Manard said.

Louisiana is ending the jobless benefits in the middle of its worst surge of COVID-19 to-date, fueled by the highly contagious delta variant and made worse by the state's lackluster vaccination rate. The state recorded more new infections over the last seven days than at any other time during pandemic, and hospitals are buckling under a flood of patients. 

Manard fears that with school beginning soon, more and more parents will be forced to stay at home with sick or quarantined kids. However, this time, they won't be able to fall back on the federal government's pandemic unemployment assistance, which provided aid to primary caregivers who can't return to work due to childcare responsibilities. 

Adrian Roberts, a plaintiff from Tangipahoa Parish, is one of those primary caregivers. Before the pandemic, she owned and operated a small farm, but had to shut it down as business slowed. Her daughter recently contracted COVID-19 for the second time and her son is suffering from a bout with respiratory syncytial virus, or RSV. 

"If she were to be offered a job today, Ms. Roberts does not know who would be able to care for her children during work hours," the lawsuit states. 

The lawsuit argues that the decision to rescind the benefits early violates the Louisiana Employment Security Law, which governs how the state's jobless benefits are administered.

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A section of that law states that officials "shall take take such action ... to secure to this state and its citizens all advantages available under the provisions of the Social Security Act that relate to unemployment compensations."

The three federal programs that Louisiana is jettisoning were enacted through the Social Social Security Act, the lawsuit states.

Therefore, by refusing those payments, the state is taking "actions which contradict the spirit of, and attempt to repeal and replace, existing law governing unemployment benefits," the lawsuit argues. 

The lawsuit also argues that Louisiana is violating the Equal Protection Clause of the 14th Amendment to the United States Constitution for its disparate treatment of recipients of federal pandemic assistance. It argues that the jobless payments primarily benefit women, minorities and impoverished people, and have come under scrutiny for no legitimate government purpose.

Edwards agreed to opt out of the federal programs, five weeks ahead of their official expiration date, in exchange for support from GOP lawmakers and business groups for a modest, long-term hike to the state’s weekly unemployment benefits. 

Under the compromise, hashed out in June during the final minutes of the legislative session, lawmakers authorized a $28 weekly boost to the state’s jobless benefits beginning in January 2022. However, for the hike to go into effect, the Democratic governor had to pull out of the "federal government's supplemental unemployment benefits program" by the end of July. 

Those programs include the $300-a-week payments, known as Federal Pandemic Unemployment Compensation (FPUC); Pandemic Unemployment Assistance (PUA), covering "gig workers"; and Pandemic Emergency Unemployment Compensation (PEUC), which allowed people to receive jobless benefits past the state's 26-week limit. 

Ten business lobbies representing contractors, retailers, gas stations, restaurants, homebuilders, convenience stores and more sent a letter to Edwards in May blaming the federal benefits for their difficulties in hiring workers.

Landry, a New Orleans Democrat, dismissed the theory that the $300 extra was keeping the unemployed out of the workforce in June when the legislation came up for a House vote in the final minutes of the Legislative session.

“I just really can’t believe you’re doing this – turning down federal unemployment for people who just had the hardest year of their lives,” Landry said. "It’s based on junk science and no data."

To measure the economic impact of ending the benefits, Edwards' administration hired longtime LSU economist Jim Richardson. 

Richardson estimated that that if the $300-a-week supplemental benefits were kept in place, Louisiana’s unemployed workforce, collectively, would pocket up to $220 million in direct payments. To match the economic activity spurred by those stimulus payments, Richardson argued that at least 40% of those currently on unemployment assistance – or nearly 59,000 people – would need to get a job in the month of August. 

The lawsuit seized on the report, arguing that with the fastest growth of COVID-19 in the country, Louisiana is the "last state that should be walking away from 220 million dollars in federal benefits right now."

A spokesperson for the governor, Christina Stephens, said the compromise will provide the first increase in weekly jobless benefits in Louisiana in decades and is likely to be the last one to occur for a while. She said the deal was "an incredibly important opportunity for us to raise the unemployment benefit in the New Year."

It's unclear what might happen to the agreed upon boost in benefits if the courts reinstate the federal payments. 

Similar lawsuits have been filed by unemployed residents in several other states where benefits were nixed early, including Arkansas, Ohio, Texas, Florida and Oklahoma.  

Jobless residents in Indiana were the first to take legal action in an attempt to block the state’s push to end pandemic unemployment benefit programs; in mid-June, two nonprofits sued the Republican governor, arguing that he had “violated the clear mandates of Indiana’s unemployment statute – to secure all rights and benefits available for unemployed individuals.” A state judge issued an injunction requiring Indiana to continue paying the benefits until the lawsuit is decided. 

Louisiana's lawsuit was filed just before midnight in the 19th Judicial District Court in Baton Rouge and names as defendants Gov. John Bel Edwards, the Louisiana Workforce Commission and Workforce Commission Secretary Ava Cates. A spokesperson for Cates declined to comment, citing pending litigation. That lawsuit has not been assigned to a judge. 

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