Indiana sued for ending extra unemployment benefits

(The Center Square) – A lawsuit against the state of Indiana could force the governor to reinstate the $300 weekly federal unemployment payments.

The suit was filed by Indiana Legal Services, a nonprofit law firm based in Indianapolis that provides free civil legal aid to low-income residents around the state. A hearing on the suit was held Wednesday by Marion County Superior Court Judge John Hanley.

Indiana Gov. Eric Holcomb announced in May that the state would exit the Pandemic Unemployment Compensation Program on June 19.

“Frankly judge, these unemployment benefits are keeping the claimants out of poverty,” Jennifer Terry, an attorney with Indiana Legal Services, said during the hearing.

Terry also said Indiana law states declaring economic insecurity due to unemployment is a “serious menace” to people’s health, morale and welfare.

Assistant Attorney General Jefferson Garn, arguing on behalf of the state, said the law Terry cited was only “aspirational language” and that decisions regarding the federal money are best left to policy makers and not the courts.

Terry went on to say the benefits were like a vehicle the state built and fueled by federal money, but that state officials “decided to throw away the keys.”

Garn said ending the payments is “in the state’s best interests,” and bringing them back would “stunt the stabilization” of the state’s economy as it recovers from the coronavirus pandemic.

Indiana’s unemployment rate for May was 4%, a slight uptick from 3.9% in April.

In making his announcement, Holcomb said there are “help wanted signs across the state” and he has been told by business owners that they want to hire more people.

“Every day I’m hearing from business owners who tell me they’re only posting half of what they can hire,” Holcomb said. “So, we’re restricting growth by keeping people on the sidelines.”

Hanley said he would have a decision on Indiana Legal Services’ request for an emergency injunction to reinstate the payments “as soon as possible.”

Money for the payments comes from the $2.2 billion Coronavirus Aid, Relief and Economic Security Act, referred to as the CARES Act, passed by Congress last year and signed into law by President Donald Trump on March 27, 2020.

President Joe Biden has said the payments will end on Sept. 6, although 25 states — primarily led by Republican governors — have already opted out or plan to do so earlier.

There reasoning has been the same as Holcomb’s, believing the extra money, in addition to state unemployment checks, is a disincentive to people finding jobs.

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