News & Press

New Law Allows Drug Testing of Unemployment Claimants

A Joint Resolution supported by U.S. Representative Kevin Brady and Senator Ted Cruz, regarding drug testing and unemployment eligibility, has officially been signed into law by President Trump. With this new Resolution in place, the collection of unemployment benefits will be dependent on the ability of Claimants to pass state drug tests. This new law repeals a regulation finalized by the Obama Administration that only allowed drug testing of unemployment claimants if an applicant lost employment because of illegal drug use or when an applicant is seeking employment in an occupation that regularly conducts drug testing for job applicants and employees, such as professions requiring the use of firearms or air traffic controllers.

The new law does not make provisions for medical marijuana in drug testing procedures, even if a patient is in full compliance with state law.

While some groups have voiced their concerns over this new restriction, saying it will cost more in drug testing than it will save in unemployment funds, others have praised the law. According to Rep. Brady, “After 5 years of battling with the Obama Department of Labor, states like Texas will now be allowed to drug tests folks for unemployment to ensure they are job ready from day one. This is a win for families, workers, job creators, and local economies.”

It is yet to be seen how many states will implement this new federal law, but it is predicted that this development will lead to further changes concerning drug use in the work force.

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Massachusetts Millionaires Collected Over $1Million in Unemployment Benefits

Massachusetts – According to a report published by Greg Ryan, Law & Money Reporter for the Boston Business Journal, nearly 160 millionaires collected approximately $1.6 million in unemployment benefits in 2014.

In Massachusetts, and many other states, there are not income restrictions in place for collecting unemployment benefits. Any person who has paid into the system can take advantage of the benefits when needed, as long as the details surrounding their separation from employment meet the state’s qualifications for receiving such benefits.

All attempts to bar millionaires from collecting unemployment benefits, at the federal level, have failed to survive Congress.

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New Bill Brings Back Laid Off Workers

Pennsylvania – On March 20th, a bill was passed allocating $15 million to the Department of Labor, which due to lack of funding, has undergone hundreds of layoffs and three office closings in the past year. The bill would enable the Department of Labor to bring back many of the 500 employees who were laid off, resulting in several major departmental slowdowns.

As stated by the Department of Labor, “The department, along with the governor, would prefer a long-term solution for this funding, but this is a good step toward that goal…However, a short-term fix alone could force the system into chaos again, and so the department will continue to work with the General Assembly to enact a long-term fix that stabilizes the (unemployment compensation) system and does not create a crisis.”

Although this is not a permanent solution, it will enable the Department of Labor to maximize effectiveness while devising a long term plan to maintain funds and success.

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Suspended Lawyers Can’t Represent UI Claimants

Pennsylvania – On March 28th, the State Supreme Court ruled that those with suspended law licenses cannot represent claimants before the Unemployment Compensation Board of Review. This ruling reverses a previous one from the Commonwealth Court, which determined that the Board did not have the authority to bar suspended attorneys from representing litigants.

According to Justice Kevin Dougherty, suspended attorneys should be considered in a different category than a non-attorney representative since they are individuals who have been sanctioned by the court for violations of the Rules of Professional Conduct and thereby are prohibited from appearing on behalf of a client. In his ruling Justice Dougherty wrote, “Our decision is informed by an understanding that the purpose of the attorney disciplinary process, including proceedings which may result in this court’s issuance of suspension or disbarment orders, is to determine whether an attorney is fit to act as an advocate in legal and law-related activities and proceedings. Orders of suspension or disbarment are designed to protect the public from attorneys who have been deemed unfit and to maintain the public’s regard for a profession imbued with its trust.”

The claimant will have another chance to find a suitable person to represent him before the Board of Review.

Read more about this case here:

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Prisoner Charged With First Degree Unemployment Fraud

Connecticut – 31 year old Jose Velez of Waterbury, who is currently serving a six-year prison sentence for first-degree robbery and escape from custody, will be going back to court for another first-degree charge. This time, it is for allegedly “robbing” the unemployment system.

According to the State of Connecticut Division of Criminal Justice, Velez was charged with one count each of larceny first-degree by defrauding a public community and unemployment compensation fraud. An investigation by the Connecticut Department of Labor shows that he fraudulently collected approximately $8,682 in unemployment benefits from Dec. 2014 through May 2015, while he was still employed.

He is scheduled to appear in New Britain Superior Court on April 27, 2017.

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Connecticut is “Chasing Cheaters”

The Connecticut Department of Labor (DOL) and the Division of Criminal Justice have joined forces to combat the state’s unemployment fraud issue. So far they have arrested 200 people charged with illegally collecting more than $5.5 million in unemployment insurance benefits. Approximately 25 percent of those arrested have paid back the owed benefit payments in full.

Ongoing repayments are being made by others as part of court-ordered restitution.

According to State Labor Commissioner Scott D. Jackson, Since the state’s “Chasing Cheaters” program began in June 2013, it has recovered nearly $1.8 million, which has been returned to the state’s unemployment fund for paying benefits”.

Additional information about the state’s Fraud Prosecution Program can be found on the DOL website:

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Connecticut’s Worker Classification Test is on Trial

Connecticut employers who use independent contractors in their business operations should be awaiting a decision in the Southwest Appraisal Group case with interest.

In this case, Part “C” of Connecticut’s Worker Classification test is being examined. According to Part “C”, in order for a worker to be classified as an independent contractor rather than an employee, they must “customarily be engaged in an independently established trade, occupation, profession or business of the same nature as that involved in the service performed.”

Southwest contends that imposing this allegedly new requirement will be damaging to the Connecticut economy whereas the state argues that its interpretation of the statutory test ensures that workers classified as contractors will be economically independent.

The case is currently awaiting oral arguments at the State Supreme Court.

Click here to read more about the case:

UPDATE: The Connecticut Supreme Court has reversed the trial court’s decision and ruled in favor of Southwest Appraisal Group. They concluded that “evidence of the performance of services for third parties is not required to prove part C of the ABC test but, rather, is a single factor that may be considered under the totality of the circumstances analysis governing that inquiry.” They further explained, “just as the mere freedom to provide services for third parties is not by itself dispositive under part C, whether the individual actually provided services for someone other than the employer is not dispositive proof of an employer-employee relationship.”

Employers now have 10 additional factors from the Connecticut Supreme Court to consider when evaluating if an individual will meet part C of that test.

Read more details on these factors and the Court’s decision here:

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Youth Unemployment Rates Rise

ConnecticutAccording to the 2016 State of Working Connecticut Report the state added 5,700 jobs in January and the unemployment rate remained at a relatively healthy 4.5 percent, but according to economists the unemployment rate for young people in the state is over double that amount at 10 percent. When urban areas were examined the rate almost quadruples to 20 percent.

Many fear that minimum wage increases will only make the issue worse as they feel that a raise in minimum wage would prevent employers from hiring young, unskilled workers.  Others feel the wage increase is vital for youths to be able to find employment where the income is enough to meet their basic needs.

While many disagree on how to solve the issue, the majority concur that education and employment programs for younger workers are keys to reversing the trend of high unemployment in the cities.

Read more on the discussion here:

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State Sues IBM for Failed Unemployment Computer System Overhaul

Pennsylvania – On Thursday March 9th, Governor Tom Wolfe’s Administration filed a lawsuit against IBM for breach of contract. In a public statement Governor Wolf said “Pennsylvania taxpayers paid IBM nearly $170 million for what was supposed to be a comprehensive, integrated, and modern system that it never got”. According to an Associated Press report, IBM says the claims have no merit and they plan to fight the lawsuit.

Read the full story here:

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Unemployment Claims Catapult Despite an Overall Healthy Job Market

In just two weeks’ time, the number of Americans who applied for unemployment benefits catapulted from just 20,000 to 243,000 which is well above economists’ predictions of unemployment claims coming in around 238,000. This new stat may come as a surprise since U.S. jobless claims as of March 2nd were reported to be at their lowest levels since March of 1973.

Even with this drastic increase in initial claim filings, many other economic indicators show an incredibly healthy labor market. The federal government is set to release a jobs report which could show 210,000 new jobs were created in February.

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