On certification to the Superior Court, Appellate Division, whose opinion is reported at 241 N.J. Super. 216 (1990).
The opinion of the Court was delivered by Stein, J. Chief Justice Wilentz and Justices Clifford, Handler, Pollock, O'Hern, and Garibaldi join in this opinion.
Under the provisions of the Immigration Reform and Control Act (IRCA), two classes of aliens became eligible for permanent-resident status: "special agricultural workers", 8 U.S.C.A. § 1160 (SAWs), and "certain entrants before January 1, 1982," id. § 1255a (pre-1982 entrants). The question presented by this appeal is whether SAWs' or pre-1982 entrants' employment after IRCA's effective date (November 6, 1986) can be included in the calculation of their eligibility for state unemployment-insurance benefits. The United States Department of Labor (DOL) determined administratively that although such aliens may include post-IRCA employment for purposes of unemployment-insurance eligibility, they cannot do so until they have received temporary-resident status from the Immigration and Naturalization Service (INS); on receiving that status, post-IRCA employment retroactively becomes eligible for calculation of unemployment benefits. The Board of Review, New Jersey Department of Labor and Industry (Board) has adopted the United States Department of Labor's approach. Pursuant to that approach the Board denied the claims for unemployment benefits filed by claimants, Carolina and Mario Brambila. The Appellate Division affirmed. 241 N.J. Super. 216 (1990). The effect of those rulings is to defer substantially the
eligibility for unemployment benefits of a large class of aliens who will eventually receive their unemployment benefits when INS processes and approves their applications for temporary-resident status in the course of legalization proceedings. We granted certification on claimants' petition, 122 N.J. 376 (1990), and now reverse.
Claimants are aliens who have applied to INS for permanent-resident status pursuant to IRCA. IRCA established a three-step legalization process for two categories of illegal aliens, SAWs and pre-1982 entrants. SAWs are those aliens who have resided in the United States and performed seasonal agricultural services for at least ninety "man-days" in the twelve-month period between May 1, 1985, and May 1, 1986. Id. § 1160(a)(1)(B). Pre-1982 entrants are those aliens who entered the United States prior to January 1, 1982, and maintained continual unlawful residence until the date they filed an application for legalization under IRCA. Id. § 1255a(a)(2)(A).
INS first determines whether an application is nonfrivolous, and if so, accepts the application and grants the applicant work authorization. Work authorization ensures that employers are not subject to prosecution and that the worker can seek employment without fear of deportation. Next, in a process that can take up to four years, INS evaluates the application and either grants or denies temporary-resident status. After a further waiting period, the alien becomes eligible to apply for permanent-resident status. The vast majority of both SAW and pre-1982 applicants have been successful in attaining temporary-resident status. According to INS, 82% of New Jersey SAW applicants and 94% of New Jersey pre-1982 applicants for temporary-resident status have been approved. INS, Legalization Application Processing System and Statistics Division, Table 2 (Dec. 23, 1990) (INS Statistics).
Carolina Brambila entered the United States in 1973, and worked sporadically as a SAW until late 1987. She applied to INS for legalization under IRCA on January 26, 1988, and having presented a nonfrivolous application, was granted work authorization three days later. On November 29, 1987, two months prior to her legalization application, Brambila had filed a claim for unemployment benefits.
Among the eligibility requirements for unemployment benefits in New Jersey is the requirement that a claimant have worked a certain number of weeks and have earned a statutorily-fixed amount over the course of the claimant's "base year." See N.J.S.A. 43:21-4(e). That base year consists of the first four of the last five completed calendar quarters before the claimant files for unemployment benefits. See N.J.S.A. 43:21-19(c). For example, if an unemployed worker filed a claim during the second quarter of 1991, the base year for that claim would be January 1, 1990, through December 31, 1990. Earning adequate wages during the base year does not guarantee eligibility for benefits. If the claimant is not a United States citizen, the State will not credit wages earned during the base year unless the claimant, at the time the wages are earned, falls within one of three statutory exceptions: the alien must be either "lawfully admitted for permanent residence"; "lawfully present for the purpose of performing the services" (lawfully present); or "permanently residing in the United States under color of law" (PRUCOL), at the time the wages were earned. N.J.S.A. 43:21-4(i)(1).*fn1
Thus, for unemployment-compensation purposes, Carolina Brambila's base year was July 1, 1986, through June 30, 1987, a time period that preceded both her application for legalization and her receipt of work authorization.
The other claimant, Mario Brambila, entered the United States in June 1985 and worked thereafter as a SAW. He applied for legalization under IRCA on October 19, 1987, and INS granted work authorization four days later. He filed for unemployment benefits on January 3, 1988. Consequently, his base year was October 1, 1986, through September 30, 1987.
In February 1988 the Bridgeton Unemployment Office denied both Carolina and Mario Brambila's unemployment benefit claims on the ground that they had not been authorized to work during their base years. The Appeal Tribunal reversed both decisions. It concluded that because the claimants were entitled and intended to seek permanent-resident status under IRCA, claimants were PRUCOL as of IRCA's effective date. Consequently, their time worked and wages earned subsequent to November 6, 1986 (IRCA's effective date), could be used to establish a claim for benefits. A year later, and after the claimants had received their unemployment benefits, the Board of Review reversed the Appeal Tribunal, concluding that the Tribunal's interpretation of PRUCOL was overly broad. Relying on a DOL Program Letter, the Board determined that although wages earned subsequent to the effective date of IRCA but prior to receipt of work authorization could be included in an applicant's base-year-credit calculation, a claimant could include such wages retroactively in calculating a claim for benefits only after receiving temporary-resident status. Because INS had not yet granted the claimants temporary-resident status, the Board denied benefits.
The Appellate Division affirmed the Board's decision, finding a substantial credible basis in the record for the Board's determination, and observing that its decision was consistent with the administrative decision of DOL, "under whose supervision the unemployment compensation program is conducted." 241 N.J. Super. at 221. Counsel for Mario Brambila has informed the Court that he was granted temporary-resident status on October 30, 1990. Consequently, pursuant to the Board of Review's decision, he is now entitled to receive credit
for time worked and wages earned subsequent to IRCA's effective date. His appeal is therefore moot. Carolina Brambila is still awaiting INS determination on her temporary-residence application.
New Jersey's eligibility requirements for unemployment benefits derive from the Federal Unemployment Tax Act, 26 U.S.C.A. §§ 3301-11 (FUTA). By providing grants to the State to cover administrative costs and tax credits to employers, the federal government creates incentives for the State to comply with FUTA's eligibility standards and thereby to be "certified" by the United States Secretary of Labor. 26 U.S.C.A. § 3302; 42 U.S.C.A. § 502. To be "certified," a state program can neither deny benefits on bases more stringent than those set forth in FUTA nor can it grant benefits more broadly than would FUTA. See Ibarra v. Texas Employment Comm'n, 823 F.2d 873, 874 (5th Cir. 1987). Consequently, the eligibility requirements of New Jersey's statute mirror those of FUTA.
In 1936 the New Jersey Legislature enacted the Unemployment Compensation Law, L. 1936, c. 270, (codified at N.J.S.A. 43:21-1 to -24.19) (Act), in response to its concern that "economic insecurity due to unemployment is a serious menace to the health, morals, and welfare of the people of this state." N.J.S.A. 43:21-2. The Act provides security against the economic hazards of "involuntary unemployment" by "encouraging employers to provide more stable employment and by the systematic accumulation of funds during periods of employment to provide benefits for periods of unemployment." Ibid. Unemployment benefits must be paid "when due," 42 U.S.C.A. § 503(1), ensuring that benefits are in "the pocket of the unemployed worker at the earliest point that is administratively feasible." California Dep't of Human Resources Dev. v. Java, 402 U.S. 121, 135, 28 L. Ed. 2d 666, 676 (1971).
As noted, both FUTA and the Act prohibit wages from being credited toward an alien claimant's base year unless at the time the work was performed that claimant was either (1) lawfully admitted for permanent residence; (2) lawfully present for purposes of performing the services; or (3) permanently residing under color of law. 26 U.S.C.A. 3304(a)(14)(A); N.J.S.A. 43:21-4(i)(1). The first category is obviously inapplicable here because claimant Carolina Brambila has not yet been granted permanent-resident status, and we need not address the third category (PRUCOL), with respect to which DOL's administrative position is quite ...