During the first week of the Fall Legislative Session, Senate Democrats introduced a 9-bill legislative package that is purportedly intended to address problems with the Michigan Unemployment Insurance Agency (UIA), but also incorporates numerous provisions that would increase employer UI taxes.
Referred to the Senate Government Operations Committee, the package would:
- Nearly double unemployment benefits from a maximum $362 per week to $602 per week and more than triple the Dependent Allowance. In future years, the maximum benefit amount would be increased annually by the rate of inflation. This bill would dramatically increase employer UI taxes: SB 531 (Sen. Morris Hood III, D-Detroit).
- Limit the amount of restitution that the UIA could recover from a claimant through garnishment to just 20%. Today, the UIA can recover fraudulent benefits and overpayments by garnishing up to 50% of a claimant’s wages. This bill would drag out the amount of time to recover employer tax dollars that were illegally or improperly obtained by a claimant: SB 532 (Sen. Rebecca Warren, D-Ann Arbor).
- Prohibit the UIA from recovering fraudulent benefits or overpayments and from enforcing interest and penalties unless a claimant has had a hearing or has expressly waived the right to a hearing. This bill would effectively ensure that no fraudulent benefits or overpayments would ever be collected, leaving employers holding the bag for fraudsters’ ill-gotten gains: SB 533 (Sen. Rebecca Warren, D-Ann Arbor).
- Increase employer penalties for late or unpaid UI taxes from 50% to 100%: SB 534 (Sen. Curtis Hertel, D-East Lansing).
- Create a tax deduction for unemployment benefits: SB 535 (Sen. Vincent Gregory, D-Lathrup Village).
- Require state agencies to assist residents and pay related expenses in the event of a database security breach: SB 536 (Sen. Bert Johnson, D-Highland Park).
- Change the Statute of Limitations for UI fraud determinations made between January 1, 2007 and December 31, 2016. This bill would essentially invalidate all fraud determinations made by the UIA over a 10-year period: SB 537 (Sen. Steve Bieda, D-Warren).
- Prioritize dollars in the Unemployment Contingent Fund to repay claimants who were incorrectly convicted of UI fraud and allow those claimants to seek recovery of bankruptcy and other legal costs: SB 538 (Sen. Jim Ananich, D-Flint).
- Require annual reporting of detailed information about delinquent employer UI taxes: SB 539 (Sen. Ian Conyers, D-Detroit).
While we’ve been working for over 7 months in the House Oversight UI Workgroup on a bi-partisan, balanced proposal to truly address the problems within the UIA, the Senate Democrat package is an opportunistic attempt to castigate employers, inflate benefit checks and let criminals off the hook. MMA will vigorously oppose Senate Bills 531-539.