Labor Law Guy

Unemployment Benefits for Strikers? Court Says Yes

Posted in Federal Labor Law, Random Musings, State Labor Law by laborlawguy on January 30, 2009

The New Jersey State Supreme Court, in a 6-1 ruling, has authorized striking nurses to receive unemployment benefits, overturning just about every precedent concerning unemployment insurance.

The lone dissenting justice, Roberto Rivera-Soto, called the decision “perverse,” noting that it “upends the common-sense notion that striking employees have left their employment voluntarily and, hence, should be disqualified from unemployment compensation benefits.”

Unemployment insurance was included in the Social Security Act of 1935, which created the Federal-State Unemployment Compensation Program. The act listed the goal as “to provide temporary and partial wage replacement to involuntarily unemployed workers who were recently employed.”

It seems pretty clear that eligible workers have to be “involuntarily” out of work, which is not the case with the strikers at Lourdres Medical Center of Burlington County.

And catch this, as reported on MyCentralJersey.com, “[T]he decision upheld a backward state law that says strikers can receive unemployment benefits so long as their company remains open.”

Can you imagine the implications of this if other state courts, or politicians, apply the same standards? And what of already-strapped employers who will now have guns held to their heads if they don’t settle quickly.

Fighting the strikers and hiring temporary help, under this scenario, could prove to be prohibitively expensive. Though employers don’t have to pay unemployment benefits directly, their state UI taxes go up proportionately (or dispropotionately, as the case may be)  as their unemployed worker total rises.

I can see it now: “I was forced to strike when my employer refused to raise my wages 300 percent.”

Involuntarily on strike and out of work–the new standard for unemployment.

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