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Dismissal upheld in SC lawsuit over unemployment benefits

Published: Oct. 14, 2021 at 5:54 AM EDT|Updated: Oct. 14, 2021 at 6:08 AM EDT
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COLUMBIA, S.C. (WCSC/AP) - The South Carolina Supreme Court has rejected a lawsuit against Gov. Henry McMaster over his early exit from federal unemployment programs providing extra money to residents during the pandemic.

Justices agreed unanimously in a Wednesday opinion with a lower court’s dismissal of the suit brought by four jobless South Carolinians.

The lawsuit did not name the four plaintiffs, saying only that they live in the state and are eligible for one or more of the Pandemic Unemployment Benefits established by the CARES Act. The residents had said they were still struggling to find work and wanted a judge to force McMaster to rejoin the federal programs.

A circuit judge had ruled the decision was McMaster’s to make. The extra benefits were scheduled to run through early September but the state opted out at the end of June.

“Our goal has always been to usher in a rapid economic recovery that will lift all South Carolinians and benefit generations to come, and we’ve done that,” McMaster said in a statement following the court ruling. “Rather than working to incentivize South Carolinians to accept one of the thousands of available jobs in our state, these federal benefits presented a clear danger to the health of our state’s businesses by keeping people home. Now, we will continue our tireless work to match qualified South Carolinians with available jobs around our state.”

Governor’s office spokesman Brian Symmes said since McMaster announced his decision to end the programs in the state back in May, the state’s unemployment rate fell from 4.6% to 4.2% and more than 25,000 more South Carolinians are working now than in May.

“We are very happy with the Supreme Court’s decision,” Department of Employment and Workforce Executive Director Dan Ellzey said. “The federal programs were voluntary and states had the option to participate. As South Carolina employers ramped up their hiring in the spring of this year and employment opportunities continued to outnumber individuals looking for work, it became evident that it was time for the state to focus more on reemployment. Thousands of South Carolinians have found employment since the termination of the federal programs, but there are still tens of thousands of open positions and opportunities currently available. We strongly encourage anyone who needs help finding their next job to visit an SC Works center and take advantage of the customized services for jobseekers.”

When McMaster announced in early May he had asked the state’s Department of Employment and Workforce to end the state’s participation, he said he was taking the action to address ongoing workforce shortages throughout South Carolina.

“South Carolina’s businesses have borne the brunt of the financial impact of the COVID-19 pandemic. Those businesses that have survived – both large and small, and including those in the hospitality, tourism, manufacturing, and healthcare sectors – now face an unprecedented labor shortage,” McMaster wrote in a letter to Ellzey requesting that South Carolina opt-out of the following programs:

  • Pandemic Unemployment Assistance
  • Pandemic Emergency Unemployment Compensation
  • Federal Pandemic Unemployment Compensation
  • Mixed Earners Unemployment Compensation
  • Emergency Unemployment Relief for Governmental Entities and Nonprofit Organizations
  • Temporary Federal Funding of the First Week of Compensable Regular Unemployment for States with No Waiting Week

“This labor shortage is being created in large part by the supplemental unemployment payments that the federal government provides claimants on top of their state unemployment benefits,” McMaster said in the letter to Ellzey. “In many instances, these payments are greater than the worker’s previous paychecks. What was intended to be a short-term financial assistance for the vulnerable and displaced during the height of the pandemic has turned into a dangerous federal entitlement, incentivizing and paying workers to stay at home rather than encouraging them to return to the workplace.”

Copyright 2021 WCSC. The Associated Press contributed to this report. All rights reserved.