By James W. Cushing
Special to the Legal
When one applies for unemployment compensation benefits, there are generally two potential opponents: the claimant’s previous employer and/or the Department of Labor itself. Obviously, an employer can oppose claims for unemployment compensation benefits on bases such as the claimant voluntarily quitting or being fired for willful misconduct. However, even if an employer takes no action to oppose a claimant, the Department of Labor can. For example, the Department of Labor can oppose a claim if, upon its review of a claimant’s application for benefits, it appears that the claimant would be ineligible under the law based on the claimant’s own representations on the application. Unfortunately for claimants, it appears that the Department of Labor will be scrutinizing their applications closer than ever in the foreseeable future.
According to a recent article in The Philadelphia Inquirer, Pennsylvania’s unemployment compensation fund was in the red by approximately $300 million in 2011. Although currently trying to borrow money to meet the current demand for benefits, legislators in Harrisburg are now searching for ways to close the gap, and due to the current political climate, raising taxes does not seem to be among the options being considered. Instead, one of the solutions that is gaining some traction is to withhold benefits from claimants who are not very “attached” to the economy. In other words, earning the bulk of one’s income over a very short period of time may cause issues with one’s eligibility, as there may be a preference for more evenly compensated employment over a longer period of time. Of course, this potential change would likely affect the underemployed more than others, as they tend to work shorter-term jobs.
Regardless of how the Pennsylvania Legislature resolves the unemployment compensation fund’s solvency problems, its desired result is to reduce the number of eligible claimants by 10 percent, or approximately 50,000 people. This will potentially affect unemployment compensation practitioners, as each denied claimant will have the right to appeal his or her denial to a hearing before a referee and beyond. Of course, claimants can be represented by an attorney to help them through such appeals and/or hearing appearances. Therefore, these new changes could also potentially increase the unemployment compensation practitioners’ caseload by up to 10 percent as more claimants may retain them to litigate the increasing number of adverse decisions against them by the Department of Labor.