The legislation would hold bad actors accountable and, in the process, protect hardworking Michiganders and honest businesses who do things the right way.
“Michigan needs to shore up its safety net so disasters like COVID-19 never leave us unprepared again,” said state Rep. Cara Clemente (D-Lincoln Park), who sponsored a bill in the package. “So many people found themselves ineligible for state unemployment benefits because their employer did not pay into the unemployment insurance system to protect their employees, as required by law. This legislation will stop unscrupulous business owners from fraudulently misclassifying employees as independent contractors and ensure employers who play by the rules and pay their taxes are not placed at an economic disadvantage.”
“When bad actors commit fraud, it damages the unemployment system and causes pain to the countless businesses acting in good faith to fund the system. They are the ones who are left to make up the difference,” said state Rep. Stephanie A. Young (D-Detroit), who sponsored a bill in the package. “It also hurts the employees who need this critical support during emergencies. We must equip the UIA with the tools it needs to hold employers accountable.”
The new round of legislation consists of six bills, proposing measures that include:
- Increasing the penalty for delinquent employer UI taxes if there is associated fraud.
- Requiring the UIA to submit annual reports to the Legislature regarding employers who are delinquent on contribution taxes, and what the UIA is doing to remedy the situation.
- Requiring employers to keep track of all declared tips of their waitstaff and report them on their quarterly reports to the unemployment agency.
- Removing some statutory requirements regarding involuntary leave for medical reasons, shifting the burden of proof onto the claimant in these situations.
- Lowering rework requirement to 4 weeks for involuntary leave cases and 6 weeks for discharge cases, instead of 12 and 17 weeks, respectively.
- Removing the language ‘a person who has been absent 3 days and not contacted the employer in a manner acceptable to the employer’. Employers have used this technicality to get rid of workers and deny them unemployment benefits during the pandemic.
“Sometimes, the wages of waitstaff aren’t properly reported, often times not including tips,” said state Rep. Abraham Aiyash (D-Hamtramck), a sponsor of the package. “Throughout the pandemic, this resulted in thousands of restaurant workers being deemed ineligible for benefits, severely hampering their ability to support themselves and their families. My bill seeks to ensure they are afforded the relief they need when they find themselves unable to work through no fault of their own.”
House Democrats continue their call for legislative Republicans to pass the package.