In a Class Action Settlement, City and State Will Pay 54,000 NY’ers $22M for the Illegal Termination of Their Public Assistance

Hundreds of New Yorkers every day are forced to miss work, either because they are sick or a death in the family or an injury or a sudden loss of child care…

Unfortunately, if you are on public assistance, a failure to show you have worked a minimum number of hours each week can result in a loss of your public assistance, even if you have one of these legitimate excuses.

And that’s exactly what happened: hundreds of thousands of New Yorkers saw their public assistance ended or reduced for experiencing the same work-life issues their more wealthier counterparts experience every day– with the only difference being they had the audacity to be poor.

So, with the help of The Legal Aid Society, a group of them got together and filed a class action law suit. And on Thursday, the Legal Aid Society announced a $22 million class action settlement with the City and State to 54,280 New Yorkers who received public assistance and whose benefits were wrongly reduced or stopped between 2007 and 2015 due to alleged violations of employment requirements that mandate recipients seek and maintain work.

Filed in April 2010, Smith, et. al. v. Proud, et. al. was brought by Legal Aid and Kramer Levin Naftalis & Frankel LLP against the New York State Office of Temporary and Disability Assistance (OTDA) and the New York City Human Resources Administration (HRA).

Under the settlement, the City and State restored benefits to recipients after a court found that plaintiffs presented claims that the sanctions were viable and were imposed without adequate class members to be able to show they had a legitimate reason to miss work. The total payments issued amounted to $22,161,369.00 to 54,280 eligible class members in New York City.

Additionally, any sanction that had been imposed during the covered time period was removed from the recipients’ sanction history.

After discovering that the City and State failed to issue payments to all eligible individuals, the litigation team returned to court to enforce the settlement. A remaining 5,000 individuals received their payments on May 8, 2022.

In order to be eligible to receive a payment under the settlement, a class member must have an open Cash Assistance case and must have been sanctioned between July 8, 2007 and December 22, 2015.

“We are proud of the years of advocacy and litigation that went into getting our clients and all New Yorkers who are on public assistance and were unlawfully sanctioned some,” said Les Helfman, senior staff attorney in the Brooklyn Neighborhood Office of The Legal Aid Society.

“The benefit levels that recipients receive are not enough to pay rent and meet basic needs to begin with, but when families were sanctioned, they were pushed even deeper into poverty. This settlement provides compensation for the neediest of these clients.”

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