A court on Tuesday prevented Maryland
’s Republican Gov. Larry Hogan
from prematurely terminating federal unemployment benefits
for tens of thousands of Marylanders, a victory for the state’s unemployed as Republican-led states
across the country continue to yank the benefits Congress
enacted during the COVID-19 pandemic
City Circuit Judge
Lawrence Fletcher-Hill issued a preliminary injunction prohibiting Hogan and his administration from taking any action that would deny Maryland residents access to the full benefits provided by the CARES Act
and the American Rescue Plan
, the $2 trillion COVID-19 relief package signed into law by Biden in March.
The order comes after a pair of unemployed Marylanders filed lawsuits against the governor
for attempting to terminate benefits in early July; trials for those cases have not yet been scheduled, but the order ensures that benefits will be available at least until mid-August.
Through early September, the American Rescue Plan extended a $300 weekly unemployment insurance
supplement, as well as benefits for those who have been out of work
for a long time
or do not normally qualify for state benefits.
Without these benefits, unemployed Americans will be forced to rely solely on state-funded unemployment insurance, which lasts only 26 weeks and does not cover a significant portion of the labor force.
owners have been complaining for months that increased unemployment benefits are discouraging people
from returning to work, resulting in a labor shortage. Hogan is among a long list of Republican governors who have said they will cut off federal unemployment benefits early.
“We have a critical problem where businesses across our state are trying to hire more people, but many are facing severe worker shortages,” Hogan said in a statement
announcing his decision to cut benefits in June. “We look forward to getting more Marylanders back to work.”
Recent job reports have done little to reflect a widespread labor shortage — businesses hired 850,000 people in June, with the restaurant and service industries seeing the greatest gains.
The Biden administration
has largely accepted Republican-led states' decision to deviate from their signature unemployment policies, but this week Biden's Labor Department
issued new guidance to help states restart benefits in the event that a judge issues a ruling similar to the one in Maryland.
The guidance states unequivocally that any state “may reinstitute participation in any or all programs it previously indicated it would be terminating” by signing a new agreement with the Labor Department. These states could backdate benefits for self-employed workers who lost them through the Pandemic Unemployment Assistance program, but not for the weekly $300 federal payment that h
In many cases, there would be a gap before workers could resume receiving benefits.
The Biden administration has not appeared eager to fight states that have moved to cut off the benefits, despite the fact that many economists believe the benefits are unlikely to play a significant role in employers' struggles to find workers. However, the Labor Department's guidance this week could nudge those states to restart their benefits, especially after Indiana
refused to do so in early July despite the fact that many economists believe the benefits are unlikely to play a major role in employers' struggles to find workers.
Some senators have called for the administration to take more aggressive action to protect the benefits. Sen. Bernie Sanders
(I-Vt.) has asked the Biden administration to take direct legal action against states that have cut off federal programs, specifically the Pandemic Unemployment Assistance (PUA) program, which covers workers, such as gig economy
workers, who do not traditionally qualify for state-run benefits.