LANSING, Mich.—Legislation that reduces fraud, restores the long-term solvency of the state’s unemployment trust fund, and prevents punitive federal interest and penalties from being imposed on Michigan employers passed the state Senate Thursday.
“By closing loopholes and eliminating fraud and abuse with these reforms we are working to make sure limited unemployment resources go to those who are truly in need,” said Sen. Mike Nofs, R-Battle Creek. “Paying down the UI debt the state owes frees employers of that unnecessary burden, giving them better opportunities to grow in the future. And restoring the state UI fund means eliminating our indebtedness to the federal government, which prevents further penalties and interest from being assessed.”
Senate Bill 806 includes reforms that will deter fraud, prevent overpayments, and encourage workers to seek employment before exhausting benefits. The bill also limits the ability of a person who was fired for cause or who left a job voluntarily from collecting unemployment benefits.
Senate Bills 483 and 484 would pay back the $3.2 billion that Michigan’s unemployment fund owes the Federal Unemployment Insurance system through a ten-year, tax-exempt bond. Without action, Michigan’s trust fund will be indebted to the federal government until 2018 and will not have a sufficient standalone balance until 2022.
SBs 483, 484 and 806 now head to the state House for consideration.