State files formal appeal in federal pandemic unemployment case


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INDIANAPOLIS — The state of Indiana formally filed its appeal this week in its case involving federal pandemic unemployment benefits.

In its appeal, the state said a Marion County judge abused his discretion in ordering the state to reinstate the federal programs while the lawsuit works its way through the courts.

The appeal, which lists Gov. Eric Holcomb and Department of Workforce Development Commissioner Fred Payne as appellant-defendants, argued that Indiana is not required to participate in the federal CARES Act unemployment programs. Holcomb, the appeal argued, can withdraw Indiana from the program at his discretion.

It also questioned the legal grounds on which the plaintiffs based their case, arguing that the CARES Act unemployment programs are distinct from the federal-state partnership governing the traditional unemployment program.

Holcomb announced on May 17 that the state planned to discontinue the pandemic-related benefits on June 19, leading to a lawsuit. On June 25, a Marion County judge said the state should resume its pandemic benefits while the case is under appeal.

Indiana did not immediately reinstate the program, saying it had technological and administrative challenges to work out with the Department of Labor. The Court of Appeals affirmed the lower court judge’s ruling, and Indiana reinstated the benefits.

From the appeal:

This Court should vacate the preliminary injunction. The Governor made a quintessential policy determination that continued participation in federal CARES Act programs was now harming Indiana’s economy more than those programs were benefitting it.

The state argued that Holcomb “reasonably determined” that the generous federal benefits from the CARES Act were hurting Indiana’s economic recovery by discouraging Hoosiers from returning to the workforce:

After studying the labor shortage problem and unemployment data, the Governor reasonably determined that CARES Act benefits, while at one time useful, were stunting Indiana’s recovery from the pandemic by incentivizing some people not to reenter the workforce.

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