Alameda Superior Court Grants Final Approval to Settlement for Programmatic Relief Affecting Hundreds of Thousands of Unemployment Insurance Claimants

On May 26, 2023, the Alameda Superior Court granted final approval to a class action settlement reached between the Center for Workers’ Rights (represented by Altshuler Berzon LLP and in-house counsel Daniela Urban) and the California Employment Development Department.  The parties reached a final settlement agreement after more than two years of negotiations in which the parties took a novel, cooperative approach focused on identifying practicable and immediate solutions to some of the serious—and seemingly unlawful—obstacles to accessing unemployment insurance that claimants faced during the COVID-19 pandemic.  The settlement has already resulted in conditional payment of more than $769 million to more than 639,000 unemployment insurance claimants.

The two-part class action settlement requires EDD to implement injunctive relief benefiting two classes of unemployment insurance claimants.  The first group, the “Continued Claims Status Class,” includes unemployment insurance claimants who received at least one benefits payment, who certified eligibility for benefits for at least one additional week, and whose eligibility remained unresolved.  Among other measures, EDD agreed to make conditional payments to those Continued Claims Status Class Members while their eligibility for current and future benefits was being investigated, and to notify those class members that the benefits they are receiving are conditioned on EDD’s eligibility review.  Under the terms of the settlement, EDD was required to implement the agreed relief for the Continued Claims Status Class beginning in July 2021 while the parties continued their negotiations, and the relief has already benefited hundreds of thousands of claimants.

The second group, the “Late-Notice-of-Overpayment Class,” consists of EDD claimants not found to have engaged in fraud, misrepresentation, or willful nondisclosure who received benefits from EDD under a qualifying program between October 1, 2019 and May 26, 2023, and to whom EDD issued a notice of overpayment more than one year after the close of the benefit year in which the claimant received the benefits in question.  EDD agreed to cancel existing notices of overpayment issued more than one year after the close of the benefit year in which a Late-Notice-of-Overpayment Class member received the benefits addressed in the overpayment notice, to refund amounts class members have already repaid in response to these overpayment notices, and to stop issuing such overpayment notices going forward.

The case is Center for Workers’ Rights v. California Employment Development Department, et al., Case No. RG21106525. The final approval order summarizing the agreed programmatic relief is here. The July 22, 2021 settlement agreement is here, and the February 16, 2023 settlement agreement is here. Please refer to the settlement agreement for detailed information on its terms.