ANALYSIS

Undue political pressure violates process, expert on labor law says

Posted April 11, 2013, at 3:21 p.m.
Last modified April 11, 2013, at 5:32 p.m.

LEWISTON — An expert on unemployment labor law said Wednesday that any undue political pressure exerted on the unemployment appeal hearing process violates the statutory fair hearing process.

“The whole premise of the system,” said Rick McHugh, senior staff attorney with the National Employment Law Project in New York, “is that the state follows the rules set by the Legislature and the courts about what does ‘misconduct’ mean and what does a ‘voluntary quit’ mean, and the parties expect a fair hearing.”

In a Sun Journal investigation, sources within the Maine Department of Labor revealed that Gov. Paul LePage pressured state employees in a face-to-face directive on March 21 to decide hearing unemployment benefits cases in favor of business owners instead of workers.

It’s a serious violation of federal standards to politicize the process, McHugh said, and “to expect individual hearing examiners to stand up against that kind of direct pressure is really providing an unfair advantage to the employers.”

Howard Reben, with Reben, Benjamin & March, a labor law firm in Portland, was more direct.

“It’s certainly a breach of due process for [LePage] to even say anything” to hearing examiners about their determinations, Reben said.

“The hearing officers are quasi-judicial people who have to interpret the law and to suggest that the law should be bent in a particular way is outrageous,” Reben said.

“The claimant’s got a right to a fair hearing and if somebody has got his foot on the pedal and trying to cause” the outcome of the process to change, that’s “totally unfair” to the claimant, he said.

The Social Security Act, McHugh said, “says that you can’t deny a claim without a fair hearing before an impartial tribunal.” And, he said, what the U.S. Department of Labor defines as an impartial tribunal is a “civil servant who is protected from discharge or other types of sanctions” assigned to hear cases “to ensure that they decide the case based on the facts and the proper application of the law.”

If someone exerts pressure during that process, he said, that destroys the tribunal’s impartiality.

He said the scenario of political interference described by Maine’s hearing examiners is reminiscent of the Reagan administration’s move to track percentages of hearing outcomes within the Social Security Administration and any hearing officer who “awarded disability benefits more than a certain amount, more than the mean, all their cases were reviewed by the Appeals Council.”

For several months last year, LePage reportedly also instructed unemployment hearing examiners to report pro-employee rulings to their supervisors before entering formal rulings on those cases.

According to McHugh, after the Reagan administration pressured hearing officers “to conform to a more anti-work, anti-applicant perspective,” the National Employment Law Project filed a lawsuit that brought attention to that “somewhat unorthodox approach” and some of the other unprecedented things that were going on during those years, and the practice stopped.

To reach a fair determination during the hearing process, the process itself has to be fair, McHugh said, especially because people can be susceptible to political pressure.

McHugh pointed out that a personally delivered directive from a governor is more direct pressure than Reagan exerted.

“Reagan wasn’t having them to the White House” to push for pro-business outcomes. “He was at least smart enough to have minions do it instead of doing it himself.”

According to Reben, the hearing process is tightly structured to ensure an independent process and that if LePage were a lawyer, “he’d probably get disbarred” for interfering.

Reben said such a violation is so serious that it may “lay the groundwork for some hearing appeals” from claimants who may not believe they received a fair hearing.

McHugh, who has written extensively on unemployment law and fair hearings over the past 30 years, said that hearing officers can certainly disagree on findings and some are seen as more pro-worker and others as pro-employer, “but that doesn’t come from outside instructions. That’s based on people’s backgrounds and good-faith differences in judgment.”

When it comes to unemployment compensation hearings, McHugh said, there is “no pro-business or anti-business angle.”

“Employers and workers should be getting a hearing that’s not influenced by outside factors and the awarding of benefits to a worker when they’re entitled to those benefits, according to the rules set by the Legislature,” he said.

“Unemployment rules are not a penalty on the employer,” he said. “They’re basically something that we use to provide a benefit to people when they are involuntarily unemployed.”

In fact, McHugh said, unemployment benefits could be seen as a pro-business measure. When unemployed workers file for benefits, he said, “what do they do with that money? They spend it at businesses.”

The nation’s unemployment benefits program was constructed, McHugh said, to guard against “social unrest and just lack of humane standards that you’d have if you just kicked people out on the street.”

He added, “That’s apparently the philosophy that people like Gov. LePage want to go back to. Unfortunately for him, the law hasn’t been changed to allow him to dictate that no one will get unemployment benefits.”

And, McHugh said, any move to interfere with the fair-hearing process “is a very serious thing in terms of having the federal government concerned about” whether the fair hearing provision in federal law is being followed in Maine.

As for the state employees who spoke up with their concerns, all of whom asked the Sun Journal for confidentiality to protect their jobs, McHugh had high praise.

The fact that some among the people attending the meeting stepped forward to express their discomfort “shows that those people have more integrity than anybody who worked at the big Wall Street banks” who stood by and watched “the financial mess that has driven our economy into the gutter.”

“Tens of thousands of CPAs and lawyers and other financial experts should have said “this is wrong. I’m not going to participate in this,’ and they didn’t.” So that some hearing examiners in Maine did stand up, he said, “is laudable.”

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