Supreme Court paves the path for a lawsuit regarding COVID-19 related unemployment claims in Alabama

WASHINGTON – Individuals in Alabama who were left in limbo for months regarding their unemployment claims due to the coronavirus pandemic are now permitted to initiate legal action against the state, as announced by the U.S. Supreme Court on Friday.

In a narrow 5-4 decision, the Supreme Court overturned a previous ruling by the Alabama Supreme Court that had dismissed a lawsuit filed by 21 claimants. Some of these individuals experienced significant delays in receiving a determination on their eligibility for benefits, while others encountered abrupt halts in their payments without sufficient clarification. Notably, one claimant’s request was thrown out after he failed to meet an administrative deadline due to being on a ventilator, highlighting the difficulties faced during this period.

The Alabama Supreme Court had ruled that those bringing forth claims must first navigate the appeal procedures of the unemployment agency before pursuing litigation. However, the plaintiffs contended that the appeals system was completely bogged down at the time, and upheld that the Supreme Court has historically allowed lawsuits to proceed even when administrative processes are underway.

Support for the plaintiffs came from a diverse array of advocacy groups, including the American Civil Liberties Union and the U.S. Chamber of Commerce. They argued that mandating the exhaustion of an appeals process before being allowed to file a lawsuit would potentially weaken various other legal claims, covering issues from civil rights to business disputes with state regulations. They emphasized the importance of maintaining legal avenues for challenges in these areas.

The state of Alabama, which faced one of the highest per-capita death rates during the COVID-19 crisis, attributed the delays in processing unemployment claims to an overwhelming surge in applications that strained the already understaffed agency during that challenging time. Nonetheless, officials noted that many of the unemployment claims from the plaintiffs have since been resolved, pointing to improvements in the situation.