RICHMOND, Va. (WRIC) — The Virginia Employment Commission will pay $200,000 to three legal aid groups that filed a federal class-action lawsuit against the agency on behalf of residents who struggled to get their benefits.

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The payment was the final unresolved issue from the settlement in the case, which came amid VEC’s problems with promptly processing and settling disputed jobless claims during the pandemic.

“The VEC is satisfied to have this matter resolved, and continues with the significant efforts required to address any remaining issues and transform the agency to be better positioned for any future events,” the agency said in a statement Thursday.

The parties reached a settlement last year, but the legal aid groups sought attorneys’ fees in February and agreed to a $200,000 payment after mediation on Wednesday. VEC said the payment was less than what the groups were asking for in attorney fees.

The organizations include the Legal Aid Justice Center in Charlottesville, Legal Aid Works in Fredericksburg and the Virginia Poverty Law Center in Richmond.

Pat Levy-Lavelle, a Legal Aid Justice Center attorney, said in a statement Thursday that the VEC acknowledged they owed the groups the fees because the plaintiffs in the case were the “prevailing parties.”

“This case achieved important progress for thousands of Virginians struggling with unemployment,” Levy-Lavelle continued. “Yesterday’s fee settlement helps fund legal aid’s work on behalf of low-income Virginians.”

In April 2021, five Virginia residents struggling to get the unemployment benefits they sought sued former VEC Commissioner Ellen Marie Hess in federal court in Richmond.

The class-action lawsuit alleged the VEC violated claimants’ rights for not responding to complaints and abruptly putting people’s benefits on hold without quickly adjudicating disputed claims. 

Under the settlement agreement, the VEC was ordered to “substantially resolve at least 95%” of the 92,158 unpaid claims awaiting adjudication as of May 10, 2021, and share information with the plaintiffs. 

The agency hit those targets and the new VEC commissioner said last month that it has cleared a backlog of nearly 250,000 jobless claims and cut the number of unpaid claims by 91% since Gov. Glenn Youngkin appointed her to the post in January.

“Although the case is formally closed, ongoing reporting continues, and Legal Aid Justice Center and other advocates remain committed to seeing progress in Virginia’s unemployment system. We know that many people are still suffering, and that is a problem that requires resolution,” Levy-Lavelle added.

The private firms also representing the plaintiffs, Consumer Litigation Associates and Kelly Guzzo PLC, worked on the case pro bono.