Halachic Questions in Unemployment Insurance Claims
Unemployment benefits are intended as a temporary wage replacement for those who are out of work, through no fault of their own, until they find a new job. In order to qualify for unemployment insurance benefits, state law determines who is eligible for benefits, how much they will receive, and for how long. The criterian often revolves around the nature of the termination of their employment relationship. Both parties will present their perspective and the State will determine whether they are entitled to unemployment benefits.
Aside from the terms of state law, there are also serious halachic ramifications to consider when a Jew files unemployment insurance claims against a Jewish employer. We will present some of the issues for educational purposes only. One should consult with rabbinic guidance should it be practically relevant.
Beware of Archaos and Monetary Harm
There are two possible problems which may arise when suing for unemployment insurance. One is Archaos, litigation through secular court. Archaosis considered a serious offense, which according to some opinions, can actually invalidate a person from being counted towards a minyan. The second halachic issue is causing monetary harm to the employer. His rates are likely to rise as a result of the suit.
The same two halachic issues arise when analyzing the more common scenario of auto insurance. Certainly these sensitive topics require individual attention from a competent authority, however we will present two favorable ways of viewing the process. This is by no means definitive and there maybe other views and perspectives on the matter.
Opinion A: True litigants and unrelated payments
In order to avoid the problem of Archaos, one must determine who is the true litigant. We may typically view the insurance company as paying their client’s obligation, thus presenting the Jewish client as the true litigant. However, some wish to perceive the insurance company as the true litigant; in other words, they obligate themselves as a result of their client’s actions, rather than simply an indemnification of the client’s obligation. From this perspective the issur of going to Archaos is avoided, because it only exists when two Jews are the litigants.
Although the other party’s premium will rise, that is a gramma (damage caused indirectly rather than by direct action) which does not necessarily require one to drop his claim in order to to avoid. (see Tosafos Bava Basra 54:). In addition, some poskim suggest that the raise of rates is due to the risk factor of the driver, and is unrelated to the payment. That factor exists regardless of the company’s knowledge, and therefore the increased premium is appropriate for this individual and therefore not viewed as gramma. Some poskim suggest reimbursing the difference in insurance premiums.
Opinion B: Minhag of compensation
There is a second perspective to the halachos of filing an insurance claim, which is a bit more complex.
Some poskim say that there is a minhag which obligates the insured to allow the claimant to be compensated through insurance with their respective rates. This argument states that by driving on public roads, one enters into the customs and obligations of using the road, among them being the obligation to indemnify an aggrieved party through one’s insurance policy. The issue of Asmachta (an obligation contingent on an event (i.e. an accident) which is typically not binding) is also rectified through minhag. The issue of Archaos is addressed by the fact that it’s not possible to use the Bais Din system for such a claim, in which case there are those who would permit this alternative method of judgment.
A difference between the two approaches to car insurance may be in a situation where the insurance absolves the party who is responsible according to halacha. In which case, according to the first explanation he would remain responsible. But according to the second approach, the minhag may help for this as well. In other words, by way of minhag one agrees to forgive any obligations which the insurance company doesn’t respect. Although the obligation didn’t exist when he entered the road and should be considered “Davar shelo bah L’olam“, minhag (with Dina Demalchusa i.e. the law of the land) can cure this as well according to some opinions. (see C.M. 201 Pischei Tshuvah)
The difference with Unemployment Insurance:
Using the example of car insurance, we can better analyze the question of filing for unemployment insurance benefits. It may seem at first glance, that the two kinds of insurance claims follow the same ruling. However there is a fundamental difference between car insurance and unemployment insurance.
Unemployment insurance benefits in the United States are paid by the government, but are generally funded by payroll taxes levied against employers. There is actually a “balance” kept, which when it dips into “the red” will result in raising the rate against the employer. Thus, when filing an unemployment insurance claim, one is in essence suing the employer for funds.
Thus, according to the first halachic understanding of car insurance in which the litigant is the insurance company and the raise of premium is agramma, in the case of unemployment, the link to the employer is more direct. This makes it questionable if one can invoke this theory.
According to the second approach of the poskim, in which the minhag obligates the insured to allow for compensation, the direct link to the employer will not effect the ruling.
It is important to consult with rabbinic guidance when filing for unemployment insurance benefits, in order to ensure that no halachos are transgressed.