As a result of a federal class action lawsuit challenging the unlawful withholding of benefits, more than 7,000 recipients of Safety Net Assistance in New York City will receive retro-payments of between $100 and $718. This settlement is thought to be one of the largest ever for recipients of public assistance benefits in New York.

“We are very pleased that these recipients are finally getting the benefits they were erroneously denied, although we regret that we needed to sue the City and State to get them to correct their mistakes,” said Julia Russell, an attorney with NYLAG’s Special Litigation Unit.

The United States Federal District Court for the Southern District of New York approved the negotiated settlement in Hercules v. Doar and more than $3 million in retro-active benefits payments are being issued by the City of New York.

The federal lawsuit was filed in August, 2010, by NYLAG, The Legal Aid Society and the law firm Cooley LLP against the New York City Human Resources Administration and the New York State Office of Temporary and Disability Assistance. In addition to Russell, NYLAG lawyers representing the plaintiffs include Special Litigation Unit Supervising Attorney Jane Greengold Stevens, and staff attorney Danielle Tarantolo.

Plaintiffs are Safety Net Assistance recipients living with young children whose public assistance benefits were reduced or discontinued for excessively long periods when they were sanctioned for alleged violations of the public assistance employment requirements.  Families can be penalized or sanctioned by having all or some of their benefits cut for up to six months when they miss a mandatory appointment. Due to a computer programming error which lasted for several years, HRA and OTDA issued notices that incorrectly told SNA recipients living with children that they were subject to the longer penalties which are, by law, applicable only to individuals living in households without children. The typical family with two children receives a maximum benefit of only $789 per month, including payments for rent.

As a result of the Hercules v. Doar negotiations, HRA and OTDA have corrected their computer systems, modified their sanction notices to include information necessary to allow individuals to challenge the duration of their sanctions, and lifted any improper sanctions currently in effect.

In addition to the more than 7,000 individuals who are receiving payments now, approximately 8,000 additional households are eligible to receive Hercules payments if and when they return to the public assistance rolls within the next 34 months.  Defendants will also delete the sanctions resulting from these improper notices from class members’ records.