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President Donald Trump has signed legislation that will give states more leeway to drug test unemployment insurance applicants, but the potential impact of the new law is unclear.
Historically, states didn't drug test people who were seeking unemployment benefits because the Social Security Act (SSA) doesn't allow states to add qualifying factors that are not related to the "fact or cause" of a worker's unemployment, explained Susan Gross Sholinsky and Nancy Gunzenhauser, attorneys with Epstein Becker Green in New York City, in an e-mail to SHRM Online.
[SHRM members-only toolkit: Managing Unemployment Compensation Costs and Caseload]
Some lawmakers, however, wanted to allow states to drug test applicants as a condition of receiving benefits, and a 2012 law served as a compromise to allow testing in limited circumstances, said Matthew Nieman, an attorney with Jackson Lewis in the Washington, D.C., area.
The 2012 amendment to the SSA allowed states to drug test unemployment compensation applicants as a condition of eligibility in the following circumstances:
Under the 2012 law, states were permitted but not required to drug test in these circumstances, Nieman explained.
In 2016, a U.S. Department of Labor (DOL) rule narrowly defined the "occupations" for which drug testing was permitted as those for which testing is required by federal or state law. The DOL said drug testing was permitted for occupations that require carrying firearms or operating vehicles that transport passengers. Testing was also allowed for flight and railroad crew members and air traffic controllers.
The most recent legislation nixes those DOL regulations.
"The regulations supporting the law have now been repealed, such that the narrow interpretation of the two exceptions above are no longer in place," Sholinsky and Gunzenhauser said.
Sen. Ted Cruz, R-Texas, and Rep. Kevin Brady, R-Texas, sponsored the new legislation.
"After five years of battling with the Obama Department of Labor, states like Texas will now be allowed to drug test folks on unemployment to ensure they are job ready from day one," Brady said in a statement. He called it "a win for families, workers, job creators and local economies."
The benefits of drug testing unemployment insurance applicants, however, aren't necessarily clear.
"It is questionable whether drug testing by the government that is not based on reasonable suspicion is constitutional," Sholinsky and Gunzenhauser said. "Indeed, in the past, federal courts have blocked states from implementing similar testing requirements."
They mentioned that 20 states already explicitly deny unemployment insurance benefits to applicants who lost their job due to illegal drug use—so drug testing would be redundant in those states.
Moreover, states would need to pay for such drug testing, which is expensive, they said.
The National Employment Law Project, a worker-advocacy group in Washington, D.C., said in a policy brief that "such drug testing is simply another humiliation piled onto unemployed workers—a hurdle designed to be so stigmatizing that it discourages people from even applying for a benefit that they have earned in the first place."
Acting Secretary of Labor Ed Hugler, however, backed the new legislation. "The Department of Labor supports the president's nullification and looks forward to examining additional flexibilities for states relative to the drug testing of persons seeking unemployment benefits," he said in a press statement.
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