The opinion of the court was delivered by: Roszkowski, District Judge.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
Before the court is a civil rights class action which challenges
the practices of the State of Illinois in its administration of
unemployment insurance benefits. The plaintiffs claim that the
Illinois Department of Labor has a practice of raising issues at
the administrative appeals hearing which were not appealed from
and for which claimants received no notice. The plaintiffs
contend that this practice violates Section 303(a)(3) of the
Social Security Act, 42 U.S.C. § 503(a)(3), and deprives the
plaintiffs of property (unemployment benefits) without the due
process of law guaranteed under the Fourteenth Amendment to the
Constitution of the United States. A bench trial of the liability
issue*fn1 was conducted on
May 4, 1982. For the reasons stated herein, the court finds in
favor of the plaintiff class.*fn2
Jurisdiction of the court is properly invoked pursuant to
28 U.S.C. § 1343. This opinion constitutes the court's findings of
fact and conclusions of law as is required by Federal Rule of
Civil Procedure 52.
I. THE UNEMPLOYMENT INSURANCE PROGRAM
Title III of the Social Security Act, 42 U.S.C. § 501 et
seq., established the Unemployment Compensation program. The
program is administered and implemented through state
governmental bodies. The Illinois program operates under the
guidelines found in the Illinois Unemployment Insurance Act,
Ill.Rev.Stat. ch. 48 §§ 300 et seq., (1981). Under the Act,
the Director of the Illinois Department of Labor is responsible
for administering the Illinois Unemployment Insurance System. The
procedures generally followed in administering the program are as
a. Initial Application for Benefits
Under the system as it is presently structured, applicants for
unemployment insurance benefits must appear personally at the
local unemployment office to apply for benefits. At the time of
this initial application, each claimant completes an application
form and then receives a benefits right interview.
During the interview, a state employee will explain the
eligibility requirements to the claimant. Among the requirements
discussed is the requirement that the claimant be able to work,
be available for work, and be actively seeking work.*fn3 This
requirement is generally referred to as the "A & A" requirement.
At the interview, which is conducted either one-on-one or in
groups with the aid of audio visual equipment, the claimants also
receive a booklet entitled "You and the Facts About Unemployment
Insurance." The booklet, 32 pages in length, makes these
disclosures about the A & A requirement:
You are eligible for benefits for any week only if
you meet ALL of the following conditions and are NOT
subject to disqualification:
During the week, you were ABLE to work, AVAILABLE for
work and actively LOOKING for work on a full-time
The law states that you must be AVAILABLE FOR WORK
during any week for which you claim benefits. This
means, during the week, you must have been willing
and ready to accept a suitable job. . . .
The law states you must be actively looking for work
on your own initiative. While the State Job Service
(at one of whose offices you must register) will make
every effort to help you find a job, you will be
expected to inform your unemployment insurance office
1. Where you applied for work.
2. The kind of work you have been seeking.
3. Your prospects of being hired.
The booklet also informs the claimant of other relevant rules
including potential grounds for disqualification, procedures
for appeal of adverse rulings, and amount of benefits to which a
person may be entitled.
After the claimant completes the application, the agency hands
the claimant a "Ben-437 form." The form, entitled "IMPORTANT
NOTICE," again reiterates the significance of the A & A
requirement. The form, in full, provides:
You have just filed your claim for unemployment
insurance benefits. IN ORDER TO RECEIVE BENEFITS YOU
MUST BE ACTIVELY LOOKING FOR WORK. The Employment
Service, with whom you are required to register
unless otherwise notified, will make every effort to
help you find a job. However, you must also look for
a job yourself. Upon request, you will be expected to
furnish this office with information regarding (1)
where you have applied for work, (2) the kind of work
you have been seeking, and (3) your prospects for
IT IS ADVISABLE TO KEEP A RECORD OF THE DATES AND
PLACES YOU APPLY FOR WORK.
As the period of your unemployment becomes
extended, you will be expected to give consideration
to the acceptance of work outside of your customary
occupation or for prevailing wages which may be lower
than you received in your last regular job.
Other conditions which you must meet to receive
benefits are explained in a booklet, YOU AND THE
FACTS ABOUT UNEMPLOYMENT INSURANCE. If you do not
have a copy ask for one at the claims counter or the
Unless the claimant is exempt, the Local Office will instruct
the claimant to register with the Illinois Job Service.
Registration with the local employment service office is also a
prerequisite to eligibility for benefits.
After the interview, the claimant is mailed form "BIS 653".
(See Appendix 1)*fn4. The form covers a two week period. In
completing the form, the claimant certifies that he was available
and looking for work. The form asks the claimant to list in
detail the potential employers contacted, the date of contact,
the person contacted, the method of contact, the type of work
sought, and the results of the contact. After the local office
mails the BIS 653 to the claimant, it begins to process the
b. Processing the Application
The local office will review the completed application to
determine whether the claimant is eligible for benefits. If this
preliminary examination indicates eligibility, the local office
mails a notice of the claim to the claimant's former employer.
The employer is entitled to object to the claim if it believes
the applicant is ineligible. If there is an employer objection,
the claimant will be summoned back to the local office and the
objection will be discussed with a claim's adjudicator.
If there is no objection, the claimant is authorized to receive
up to 26 weeks of unemployment compensation provided that the
claimant continues to satisfy all eligibility requirements.
c. Monitoring For Continued Eligibility
The local office also monitors eligible claimants to be sure
that they continue to satisfy all requirements. This continuing
review is achieved primarily through the BIS 653 form. Every two
weeks, the claimant files a new BIS 653 that certifies continuing
eligibility and documents in detail the claimant's availability
for work and efforts to find work during the two week period
covered by the form.
At the follow up interviews, the claims adjudicator will insure
that the office's files are current and that the information
contained therein is accurate. The claims adjudicator will also
inquire into the claimant's continuing satisfaction of the A & A
The claims adjudicator will then decide whether the claimant is
still eligible for benefits. The decision is rendered in writing,
setting forth the basis of the decision. The written
determination also informs the party of the right to appeal the
decision to a referee. Either the claimant or an employer is
entitled to appeal an adverse ruling.
A party also has a right to request the claims adjudicator to
reconsider his decision before the claimant brings the appeal.
Where reconsideration is requested, the claims adjudicator again
gives written reasons for his ruling. Either the claimant or an
employer may appeal an adverse reconsideration ruling.
An adverse ruling by the claims adjudicator at any stage of the
application process may be appealed.
The appeals process begins with notice to the claimant of the
right to appeal. The claims adjudicator's written determination
contains standardized language which informs the party that they
"may file an appeal, in person or by mail." The time limits for
filing an appeal are stated. The written determination also
informs the party that he will have the opportunity to present
evidence at the appeal.
The claimant is also instructed to report to the local office
on the claimant's regular report day and to continue to file the
biweekly BIS 653 forms during the pendency of the appeal.
After the local office receives the notice of appeal, it sets a
hearing date and notifies the claimant of the date by mail.
At the appeal the referee will conduct a hearing which first
addresses the claims adjudicator's reasons for denying the
benefits. The reason or reasons for the denial may or may not
include the A & A issue. Where A & A is noted as an issue on
appeal, the referee will address it first. If it is not an issue
on appeal, the agency's internal procedural manual advises the
referee to first address the written reasons for the denial. If
those reasons are found to be meritless, the manual instructs the
referee to then inquire into the A & A issue. The net effect is
that any claimant wishing to establish eligibility through an
appeal will have to overcome the A & A issue whether or not it
was specifically noted as a basis for denial of benefit in the
adjudicator's written decision.
The BIS 653 forms, which the claimant has been filing every two
weeks to document his A & A are not physically before the referee
at the appeals hearing. Nor are the forms available for the
claimant to review at or prior to the hearing. The agency does
have a policy, however, of granting continuances of appeals if
the claimant needs to gather evidence of availability for work.
The continuance must be requested, however, and the agency does
not have an established policy of informing all claimants as a
matter of course that they have the option of a continuance
should they find that they are without necessary documentation.
The court finds, as a factual matter, that the failure to
notify claimants that the A & A issue may be raised on appeal has
the effect of placing some claimants before the referee
unprepared to address the issue. This fact is well illustrated by
the experience of two of the named plaintiffs in the action,
Steven Flowers and Carmen Camacho.
II. EXPERIENCES OF NAMED PLAINTIFFS WITH THE UNEMPLOYMENT
At the time of his application, Mr. Flowers received a booklet
entitled, "You and the Facts about Unemployment Insurance" (BEN
224). Mr. Flowers read the booklet and generally understood it.
Mr. Flowers was told by the claims adjudicator that he had to be
looking for work and able to work and that he would be ineligible
for benefits if he was not looking for work and was not able to
work. He was also told that he had to register with the ...