Big Win for NJ Unemployment Insurance Claimants

The New Jersey Department of Labor has settled a lawsuit that claimed applicants for unemployment benefits have been wrongfully denied counsel and other due process rights. As part of the Consent Order that lays out the terms of the settlement, the Department agrees to address its procedures for telephone hearings and other proceedings.

Each claim for unemployment has three possible stages where notifications are sent out: (1) a notification of the initial fact-finding interview; (2) notice of a hearing before an appeal tribunal, which is sent out if the claimant challenges the initial eligibility finding; and (3) notice of hearing before the Board of Review, which is the next and final step in the internal process before the matter goes to an appellate court.

The class action lawsuit claimed that notices sent at the first and third stages of the above process lack any notification that the claimant has a right to counsel. The lawsuit pleadings claimed that, even worse, claims examiners routinely instructed claimants that they do not have the right to counsel, and affirmatively prevented them for doing so. This is quite troubling, given that attorneys ensure that the rights of claimants are protected and instruct their clients on what they can legally accomplish.

As part of the settlement, the Department agreed, among other measures, to update its’ written notifications and direct claims examiners to advise claimants of their rights, particularly the right to be represented by an attorney or non-lawyer. The Department also agreed to circulate an administrative directive to the examiners, who will be required to read a statement outlining what role attorneys may play in the hearing, including the ability to make objections, provide documentary evidence or offer a closing statement. Moreover, where the ex-employee and the employer are both attending the hearing, the examiner must advise of the attorney’s right to ask questions of the other side, according to the directive.

It’s about time that the Department cleans up its unemployment benefits procedure. As a practitioner who regularly represents claimants before the Department, I have personally witnessed the widespread violations of people’s rights, at a time when they are unemployed and the most vulnerable. Hopefully, these hard fought for changes will vastly improve the system.