Louisiana Court Declines to Restore $300 Weekly Jobless Benefit

On Aug. 1, Louisiana stopped paying the $300 weekly supplemental unemployment benefit payment provided by federal law. Prior to the elimination of the benefit, six Louisiana residents sued the Louisiana Workforce Commission and Gov. John Bel Edwards to compel the restoration of the $300 weekly benefit payment.

The plaintiffs allege that they will suffer undue hardship as a result of the termination of the federal benefit, especially given the fact that Louisiana is among the states hardest hit by the Delta variant of the coronavirus. The lawsuit mirrors similar actions filed in Indiana and other states. (The lawsuit in Indiana was successful and resulted in the reinstatement of the $300-per-week supplemental benefit.) The plaintiffs argue that Louisiana's unemployment compensation law mandates that state officials secure federal benefits funding when available, thus rendering the repeal of the $300 benefit unlawful.

On Aug. 12, a state district court judge in Baton Rouge denied the plaintiffs' request for injunctive relief. The judge ruled that while the plaintiffs had shown irreparable harm, they failed to show a likelihood of winning the case on the merits. Counsel for the plaintiffs indicated that they would file an appeal of the court's decision. The $300 weekly benefit expires under federal law on Sept. 6.

Background

Louisiana became the first state with a Democratic governor to pass a law eliminating the $300-per-week supplemental unemployment benefit created by the federal American Rescue Plan Act of 2021 (ARPA). Under the new measure, Act No. 276—which Edwards signed into law on June 15—Louisiana eliminated the $300 benefit, effective Aug. 1, while increasing the weekly maximum benefit amount.

Under the ARPA, signed by President Joe Biden in March 2021, Congress provided a supplemental unemployment benefit of $300 per week to help offset the wide unemployment caused by the COVID-19 pandemic. The supplemental amount was paid in addition to the weekly unemployment benefit amounts payable under state law. The maximum weekly benefit amount will increase to $312 on Jan. 1, 2022.

With increased vaccinations, Louisiana's economy has gradually reopened with an acute demand for workers, especially in the service sector. In Louisiana, as in many other states, business groups, headed by the Louisiana Association of Business and Industry, the state's chamber of commerce, spearheaded an effort to repeal the $300 weekly benefit payment widely perceived as disincentivizing employees from returning to the workplace.

Andrew P. Burnside and Ellen C. Rains are attorneys with Ogletree Deakins in New Orleans. © 2021 Ogletree Deakins. All rights reserved. Reposted with permission.