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Aug. 26, 2021Iowa City, Iowa |  By: AP

Lawsuit argues Iowa's unemployment benefit cuts are illegal

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IOWA CITY, Iowa (AP) - A proposed class-action lawsuit claims that Iowa Gov. Kim Reynolds' decision to end enhanced unemployment benefits for tens of thousands of residents violated state law and asks a court to reinstate their aid.

The lawsuit seeks to make claimants eligible for potentially hundreds of millions of dollars in unemployment aid they have been denied since Iowa in June ended federal pandemic relief programs that provided an extra $300 per week and expanded eligibility criteria.

Reynolds says ending benefits encouraged people to return to work, although the impact has been unclear. The lawsuit claims the decision violated a state law that says Iowa "shall cooperate with the United States Department of Labor to the fullest extent" in order to take advantage of federal unemployment programs.