Michigan has changed the unemployment rules. Now 648,000 may have to repay benefits
Another 42,092 people who “were initially denied … are now eligible for benefits,” said Lynda Robinson, spokesperson for the Michigan Unemployment Insurance Agency.
As the department kicks off the review, the situation reignites lingering concerns about the unemployment system during the COVID-19 pandemic, which has prompted lawmakers to plan to bring UIA staff back to the oversight committee of bedroom.
“There are just a number of issues that we have seen at the agency that need to be addressed,” Representative Steve Johnson, R-Wayland, told Bridge Michigan.
The problems range from repeated system crashes and widespread fraud investigations that have frozen benefits for hundreds of thousands of residents to delays in processing claims that continued for months after the state hit peak unemployment. in April 2020.
More recently, the state reopened its unemployment offices on a limited appointment basis, after months of frustration among bipartisan lawmakers who said their staff still needed to help voters navigate the bureaucracy to get paid.
“There is clearly mismanagement at the UIA,” Johnson said.
The latest problem comes after Michigan officials learned that their criteria for applying for pandemic unemployment assistance payments were not authorized by the US Department of Labor.
The PUA was created in March 2020 by the $ 2,000 billion CARES law to provide unemployment benefits to people who do not qualify for the state unemployment system. They include part-time workers, self-employed workers and workers in the so-called “concert” economy.
PUA payments totaling $ 5.7 billion were made in Michigan through the first week of July – an amount equal to payments through the traditional unemployment system.
As of July 2020, just under one million people were receiving PUA benefits in Michigan. A year later, that total is approximately 391,000.
PUA benefit recipients received an average of $ 216 per week in Michigan, compared to the weekly average of $ 312 for regular unemployment benefits.
In late June, however, the state sent three-page letters to recipients warning them that they may not be eligible for payments because they did not meet criteria acceptable to the Labor Department.
Eleven criteria were on the agency’s list in 2020, then it added three more in February 2021.
But when the PUA program was launched in Michigan, it included “four reasons that were not provided or approved by the (Department of Labor),” according to the state letter.
These unapproved reasons were used in the state for initial applications and ongoing certification. The letters inform the recipients that the following reasons can no longer be used:
- Your working hours have been reduced as a direct result of COVID-19.
- You are looking for a part-time job affected by COVID-19.
- You do not have enough work history to qualify for regular unemployment benefit and are affected by COVID-19.
- You are unemployed or work less than normal hours due to COVID-19 and have been denied benefits for another claim.
Late Tuesday, it was unclear when state officials determined their PUA arrangements were unclear and what steps they took to remedy the situation before notifying affected residents.
“At the onset of COVID, there was ambiguity in federal guidelines and more leeway in the interpretation of those guidelines by states, including Michigan,” said Robinson, the UIA spokesperson, in a statement.
“As the program continued, (the US Department of Labor) became more prescriptive to states about what could and could not be included.”
However, Rachael Kohl, director of the Workers’ Rights Center at nonprofit Michigan United, said she wondered whether the state was acting on a request from the Department of Labor or making its own decision.
She said the federal government made it clear to states at the start of the pandemic “to be incredibly flexible and to err on the side of granting benefits.”
Now she asked, “Is (the agency) choosing to be too restrictive?” Or did (the federal government) say you got it wrong? “
Either way, Kohl said, people who chose the reasons for unemployment that the state now declares invalid will find similar reasons in the valid list – they are simply worded in different ways.
She said this only raises more questions about why nearly 700,000 people will have their accounts examined.
“These reasons they say they’re not good enough are so close to what they say are good enough,” Kohl said. “It’s semantics.”
The state letter tells those affected that they have 20 days from receipt to make a “self-attestation” on their online unemployment account if a legitimate qualification applies to them.
“However,” warns the state, “your selection must be true. Do not select a reason that does not apply to you directly.
It is also unclear how long the state will take to complete the exams and whether benefits will continue to be paid during this period.
No estimate of the number of people likely to lose access to services was available from the UIA.
“If you are entitled to benefits, you will be paid”, according to the letter. “If it turns out that you are not eligible, you can appeal. “
But if a person is found to be ineligible, they may also have to reimburse the benefits.
Details on how this would work and whether the federal government should approve this for PUA funds were not available from the state on Tuesday.
However, Kohl said state rules say the agency must forgo forced refunds when payments were made through administrative error.
His advice to anyone found ineligible for benefits during this large-scale review is to appeal and say that an administrative error is the cause.
Finding a new category to justify their claims may not be the only check that a person receiving PUA benefits will soon be faced with.
The state also said it will update the files to ensure it has accurate proof of employment or self-employment, as well as sufficient identity verification.
Kohl said many people contacted her, fearing they would have to repay spent allowances received while they were out of work.
Johnson, meanwhile, said he hopes those who receive the UIA letter recognize that they need to take action.
So far, he has not received complaints from voters, but called some of the agency’s official communications “very convoluted”.
“People can really trip over it,” Johnson said. “They really need to use language that people can understand.”