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Can someone in NY (preferably a lawyer with UIC knowledge) explain how an illegal enterprise makes employees of said IE able to claim unemployment?

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The former employee of Playstation had worked at the club for three years, was covered by employee health insurance, paid taxes and was entitled to unemployment compensation after the club closed.

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Politicians all smoke crack, it seems....

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I cannot speak for all the rooms because some operators may have changed the standard methods but Playstation paid taxes on all the revenue they bring in, paid their employees a salary (usually minimum wage because they operate on tips), offered health care benefits for the employees, and operated a legal businesses that cannot be closed down due to tax code regulations. This was something that the NY Times found very interesting, you can be an underground quasi-legal business such as a poker room and still be a responsible member of the business community. Some of the employees would be making minimum wage at best if it wasn't for the poker rooms, the community has taken many a person OFF of skid row; ironic isn't it?