Amicus Curiae Brief — California Department of Human Resources Development v. Java

In the Supreme Court of the

United States

Ocroser Term, 1970

No. 507

CatiForNIA DEPARTMENT OF Human RE-

SOURCES DEVELOPMENT, et al.,

Appellants,

v.

JupiTH Java, et al.,

Appellees.

On Appeal from the United States District Court

for the Northern District of California

Motion to strike the Brief for the United States

as Amicus Curiae or in the alternative for

leave to file a reply thereto

On January 12, 1971, three days before the filing date

for appellees’ brief and after that brief was at the printer,

appellees were served with page proofs of the Brief for

the United States as Amicus Curiae in support of appel-

lants, The Court noted probable jurisdiction in this case

on October 26, 1970; appellants’ brief on the merits was

fled on December 2, 1970, rendering all amicus curiae

briefs filed in support of appellants due likewise on Decem-

ber 2. Rule 42(2). Thus, the brief filed by the United States

bht ao

was 41 days late. No justification was offered for violating

Rule 42(2), and no prior notice was given to appellees ths

a brief would be filed in the case by the United States,

The Court, by requiring amicus curiae briefs supporting

appellants to be filed at the same time as appellants’ ow,

brief and at least thirty days before that of appellees, seeks

to assure that the responding side will have time to ade.

quately consider all arguments opposed to its position, The

United States, which files many amicus curiae briefs each

year with this Court, is surely aware of Rule 42(2) and of

its purpose. By filing after appellees’ brief was necessarily

due at the printer, the United States precluded appelless

from responding to its presentation.

The brief filed by the United States in violation of Rul

42(2) is not essential to the complete elucidation of appe.

lants’ position. Appellants themselves have filed a jurisdic.

tional statement and a brief on the merits. They have the

opportunity to file a reply brief as well. In addition, seven

other briefs amici curiae were filed on behalf of appellants

before the brief of the United States. Thus, the United

States’ brief is not only untimely but also unnecessary.

iii

For the aforementioned reasons, appellees respectfully

pray that this Court strike the Brief for the United States

as Amicus Curiae. In the alternative, appellees seek leave

to file the attached responsive Supplemental Brief.

Dated January 28, 1971

Respectfully submitted:

Evaent M. Swann

Contra Costa LEGAL SERVICES

FounDATION

337 Tenth Street, P.O. Box 1669

Richmond, California 94801

Attorney for Appellees

Joun Diaz CoKER

James M. Kier

TrerrENCcE RicnHarp Van Oss

Contra Costa LEGAL SERVICES

FouNDATION

$37 Tenth Street, P.O. Box 1669

Richmond, California 94801

Kennet F. Pxaiiures

SrePHeN P. Berzon

Nationa, Housing & Economic

DEVELOPMENT Law PROJECT

Earl Warren Institute

University of ornia

Berkeley, California 94720

Of Counsel

ren eee a ee

‘Inthe Supreme Court of the

United States

Ocroser Trem, 1970

No. 507

Catirornia DePaRTMENT OF Human Rz-

SOURCES DEVELOPMENT, et al.,

Appellants,

v.

JupitH JAVA, et al.,

Appellees.

On Appeal from the United States District Court

for the Northern District of California

Supplemental Brief of Appellees in response

to the Brief for the United States

as Amicus Curiae

The arguments of the United States proceed from a

misunderstanding of both the California unemployment

insurance disbursement procedure and the premises under-

lying appellees’ statutory and constitutional challenge

to that procedure. As discussed on pages 27-32 of

appellees’ principal brief on the merits [hereinafter Appel-

lees’ Brief], the California eligibility determination is not

a screening process (Brief for the United States as

Amicus Curiae at 8, 10, 16, 18 [hereinafter U. S. Brief]).

Rather, as the court below found, it is the product of a

eee

Pa sate em i IIS A EIR

2 “2

thorough factual investigation in which all interested par.

‘ties are afforded an opportunity to be heard.’ Appelleg

have never urged that unemployment benefits may not be

suspended upon an employer’s appeal merely becanse,

under the California procedure, they are paid immediately

upon the initial determination. Our position is simply that

as soon as all parties have been heard and a prompt deter.

mination of eligibility made, the Social Security Act and

the Due Process Clause both require the full payment of

unemployment benefits.

Unlike the eligibility determination in California, ap

initial decision in Washington, D. C. is based solely upon

information provided by the claimant. D. C. Code § 46311,

See D. C. Compensation Board v. Hahn, 399 F. 2d 987, 989.

990 (D.C. Cir. 1968). In enacting the District of Columbia

unemployment compensation law, Congress provided for

a stay of benefits to allow an employer an opportunity to be

heard,? thus recognizing that information from employers

is essential to a meaningful decision. In passing the D. C.

stay provision, however, Congress in no way condoned a

delay of benefits for a median period of seven weeks after

an employer has had an opportunity to be heard—the pro-

c. lure obtaining in California under Section 1335 of the

California Unemployment Insurance Code. See Appellees’

Brief at 24, n. 18; Brief for the AFL-CIO as Amicus

Curiae at 10.

Nor does the fact that Congress knew at the time it

passed the Social Security Act that 10 million people were

unemployed suggest in any way that lengthy delays in

paying benefits were contemplated. Under the scheme pro-

vided in the Act, no compensation is paid to a worker un-

1. See statistical analysis, Appellees Brief at 30.

2. D.C. Code § 46-311(b).

8

less he has worked for an employer paying taxes into a

state unemployment fund. Therefore, those thrown out of

work before the bill went into effect could not possibly be

covered. Indeed, Congress realized when it passed the

Act that unemployment benefits would have no significant

effect on the huge unemployment problem created by the

economic collapse of the early 1930’s. As the House Com-

mittee Report states:

“Tt should be clearly understood that state unemploy-

ment compensation plans made possible by the bill

cannot take care of the present problem of unemploy-

ment. They will be designed rather to afford security

against the large bulk of unemployment in the future.”

H. R. Rep. No. 615, 74th Cong., 1st Sess., 7 (1935).

Congress intended the millions of people out of work at the

time of the Social Security Act to be helped not by the

unemployment insurance system but by another program,

work-relief. Jd. Thus, the unemployment scheme was not

seen as a way out of the 1935 economic crisis and its

procedures were not designed to handle an immediate

deluge of claims. Rather, by assuring the payment of un-

employment benefits during the initial stages of unemploy-

ment, Congress meant to prevent such disastrous large-

scale unemployment in the future, thereby obviating the

necessity for a scheme capable of processing a large pro-

portion of the American work force at one time. See Appel-

lees’ Brief at 16-19.

3. The Social Security Act provided, in fact, that no unemploy-

ment benefits be paid out until 1938, two years after the first taxes

were collected under the program. The purpose of this provision

was to assure enough time for sufficient funds to accumulate to

place the new program on a sound financial footing. Section 903 (a)

(2) of the 1935 Social Security Act, 49 Stat. 620, 640. Statement of

Edwin E. Witte, Hearings on H. R. 4120, House of Representatives,

Committee on Ways and Means, 74th Cong., 1st Sess. 157 (1935).

4 ee

Further, while the brief of the United States asserts th

California’s median seven week delay is constitutionally

permissible and in conformity with the Social Security ‘Ag.

the present activities of the Secretary of Labor belie thy

assertion.‘ Under the principle of cooperative federalism a

embodied in the Social Security Act, the federal government

can impose standards on the states only to assure conformity

with the Act. The Secretary has power, then, to shorten the

period in which benefits are suspended only if, under the

present procedure, benefits are not being paid “when due”, 49

U.S.C. 503(a) (1). If the Secretary, in fact, makes significant

additions to current federal regulatory requirements for

state participation in the unemployment compensation pro.

gram in order to shorten the delay period, he does so only be.

cause he considers present delays unlawful. And, as the

United States fails to recognize, under Rosado v. Wyman,

397 U.S. 397 (1970), the courts have a duty parallel to that of

the executive branch to enforce the Social Security Act in

an action brought by its beneficiaries when a provision of

that Act is being violated.

Since the decision in the court below, California has

been paying benefits to all employees found eligible at the

initial determination, thus both assuring payment during

the initial stages of unemployment and comporting with

due process requirements. The United States proposes,

however, that California might, if the decision below is

affirmed, choose to abandon this efficient method in favor

of one less effective but still permissible under the Due

Process Clause. (U. S. Brief at 16-17). Yet the possible

alternatives suggested by the United States are either not

alternatives at all or are clearly prohibited by due process,

4. U.S. Brief at 14.

5

Thus, California cannot change to procedures which

“gntomatically set each claim down for hearing (in the

absence of waiver by the employer)”* or “have the inter-

viewer himself hold a hearing whenever a question of eli-

gibility is raised,” because the system currently employed

fis either of these descriptions. Indeed, it is precisely

pecause eligibility determinations are reached only after

all interested parties have been heard that claimants de-

eared eligible at this stage have an interest in their benefits

sufficient to entitle them to procedural due process.

Were California to “refrain from paying benefits until

after the employer’s time to appeal expired” (U.S. Brief

at 16), its procedure would then deprive not only appellees

but hundreds of thousands of additional eligible recipients

of benefits without due process of law.” Due process is vio-

lated by Section 1335 not merely because benefits once paid

are terminated, but also because benefits found due after a

thorough investigation in which both sides are heard are

summarily withheld.

Finally, while a system requiring “the interviewer to

defer decision and set the case down for hearing before a

referee whenever the employer challenges a claim in writ-

ing” might in fact be consistent with due process require-

ments, it would at the same time be completely infeasible

administratively and would almost certainly result in a

violation of the Social Security Act. In 1969, 99% of those

claimants disqualified from receiving benefits because of

the reasons they left their last jobs were found ineligible

not upon an employer’s appeal but at the initial eligibility

5. U.S. Brief at 16.

6. U.S. Brief at 17.

7. In 1968, 401,927 initial eligibility determinations were made

in favor of claimants. (A. 105).

8. U.S. Brief at 17.

6

determination.’ Were the California legislature to adopt th

. procedure the United States proposes, it would increas,

manyfold the burden upon the already overburdened refer,

system. The cost of hiring the many additional refergs,

needed to make such a system function smoothly could not

possibly be justified because the system in effect in (gj.

fornia since the decision of the court below processes en.

ployers’ objections quite efficiently and cheaply.” 7

change the current system in this direction without hiring

commensurately more referees would cause lengthy delay

before determinations are made, thereby violating the Socig]

Security Act by assuring that benefits are not paid “whey

due”—during the initial stages of unemployment.

In contrast, the payment of benefits pending an em.

ployer’s appeal is administratively and fiscally feasible

The California Unemployment Fund has continued to thrive

since the decision of the court below. See Appellees’ Brief

at 54-55. As the United States notes at page 16 of its brief,

Rhode Island specifically prohibits the suspension of bene.

fits pending an employer’s appeal. R. I. Gen. Laws 28-4440,

Despite this provision, employers are taxed at a lower rate

in Rhode Island than in California. From 1950 to 1969,

9. 139,274 claimants were found ineligible for benefits for leay.

ing their last employment under disqualifying conditions. Only

2,990 (1%) were ruled ineligible by a State referee upon an en-

ployer’s appeal. J. S., App. C at 14.

10. Under the present procedure, there are only a small number

of unrecouped overpayments (See Appellees’ Brief at 46-47). To

add the additional referees necessary to effectuate a system which

delays deciding all disputed claims until after a referee’s hearing

would greatly increase the cost of administering the unemployment

compensation program. It is extremely unlikely that this cost would

be outweighed by savings of unrecouped overpayments.

11. In 1970, California’s employers were taxed at a rate of 23%

of taxable payrolls and 1.3% of total payrolls. During the same

period, Rhode Island’s employers were taxed at a rate of 18% of

taxable payrolls and 1.1% of total payrolls. U. S. Dept. of Labor,

Manpower Administration, Unemployment Insurance Program Let-

ter No. 1053, April 20, 1970.

the amount of reserves available for benefits in Rhode

Island has risen from $23,171,419.43 to $83,763,392.16.

R. I. Dept. of Employment Security, 1969 Statistical and

Fiseal Digest, 21.

Thus, the system employed in California since the ruling

of the lower court is effective, constitutional and statutoriiy

permissible ; all those suggested by the United States are

either that same system or are inefficient, unlawful and

unconstitutional. It is hard to see, then, how the Court by

upholding the decision below would be, as the United States

intimates, opening the way for a system less beneficial to

appellees and other claimants than the one presently pro-

vided by the State.

CONCLUSION

For the above mentioned reasons, and the reasons stated

in appellees’ principal brief, the judgment below should be

affirmed.

Respectfully submitted:

Evoens M. Swaxn

Contra Costa LEegat SERVICES

FOUNDATION

337 Tenth Street, P.O. Box 1669

Richmond, California 94801

Attorney for Appellees

Joun Diaz Coker

James M. Kier

TerRENCE RicHarp VAN Oss

Contra Costa LEGAL SERVICES

FOUNDATION

337 Tenth Street, P.O. Box 1669

Richmond, California 94801

Kennetu F’, Parnes

Srepuen P. Berzon

Nationa, Hovusine & Economic

DEVELOPMENT LAW PROJECT

Earl Warren Institute

University of fornia

Berkeley, California 94720

Of Counsel

Dated: January 28, 1971