The Michigan Senate unanimously approved legislation, Senate Bill 700, barring the Michigan Unemployment Insurance Agency (UIA) from recovering improperly paid unemployment insurance (UI) benefits caused by clerical or administrative errors after three years.

This legislation is in response to the UIA’s recent attempt to recoup money from overpaid claims during the pandemic. In addition to fraudulent claims, there are a large number of Michiganders that received payments on claims made in “good faith” and now are being asked to pay back significant sums. This legislation aims to protect claimants from unexpected bills resulting from UIA mistakes; however, it also encompasses an estimated $2.7 billion in overpaid claims. Because this money is owed to the federal government, there is concern that without the approval from the U.S. Department of Labor (DOL), the state could be forced to pay back the money and raid the UI Trust Fund to do so, forcing employers to continue to pay for the mismanagement of Governor Whitmer’s COVID policies through higher unemployment insurance taxes.

Thanks to NFIB and other members of the business community, this legislation now clearly states that employers will not be held financially liable through the 100% employer-funded UI Trust. However, in order to fully protect employers, NFIB will continue to work with stakeholders to procure a waiver from DOL before the legislation moves further.