State Supreme Court hears arguments over end to pandemic unemployment aid

COLUMBIA, S.C. (WIS) - On Monday, the South Carolina Supreme Court heard arguments over Governor Henry McMaster’s decision to end federal pandemic unemployment relief early.

The SC Appleseed Legal Justice Center sued the governor and the Department of Employment and Workforce Director Daniel Ellzey over the governor’s decision to end the aid in June when the aid programs ran through early September.

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In announcing his decision, the governor said the end of the benefits would help alleviate the labor shortage state faced.

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In their lawsuit, attorneys for Appleseed argued the early end to the assistance harmed their clients and thousands of other South Carolinians.

Their goal is to ultimately have the benefits retroactively provided to eligible citizens. In May, the DEW estimated the financial impact of the governor’s decision would be up to $600 to $650 million.

However, the department expected that number to drop as people re-entered the workforce.

Appleseed attorney Adam Protheroe argued McMaster and Ellzey are compelled by SC Code 41-29-230 to keep the funds flowing.

It reads in part:

“...the department must cooperate with the United States Secretary of Labor to the fullest extent consistent with the provisions of these chapters, and act, through the promulgation of appropriate rules, regulations, administrative methods and standards, as necessary to secure to this State and its citizens all advantages available under the provisions of the Social Security Act that relate to unemployment compensation,...”

Protheroe argued because the CARES Act funds flow through existing Social Security accounts, it is connected to the Social Security Act.

“I believe the General Assembly has done that, by directing the [DEW] to go and obtain the benefits that are under the Social Security Act and the reason we know that these are benefits are available under the Social Security Act, and that word available has sometimes been omitted from the arguments. If you take away the Social Security Act, nobody gets benefits. That’s how you know,” he said.

Meanwhile, attorney for the governor Grayson Lambert argued the accounts serve merely as pass-throughs, and the aid remains independent of the Social Security Act.

“The money is available because these programs were created by the Cares Act, people are eligible for the money if they meet the requirements of the Cares Act and the money itself is appropriated by the Cares Act,” he said.

“To take it out of the context of a large federal program into something that’s simpler to get our hands around, we get paid by our employer for the work we do and the money shows up in our bank account and we then may use it. No one thinks that their paycheck is available under their bank account,”

Near the end of the hearing, Justice John Cannon Few questioned Protheroe about whether the issue was moot and if the federal funds were retrievable.

Protheroe responded by saying the goal of the lawsuit is to get the DEW to rejoin the federal program. If the funds can’t be accessed, then they’d look at a “fight” with the U.S. Department of Labor.

The justices did not rule on the case.

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