Michigan charges interest on unemployment benefits to be repaid

A recent case brought to my attention that the State of Michigan Unemployment Insurance Agency (UIA) is now charging interest on unemployment benefits that must be returned. Apparently, the Michigan Employment Security Act was amended in 2011 to require the UIA to charge interest at the rate of 1% a month. 2011 Mich. Acts. 14. Unfortunately, even if you and the UIA believed that you qualified for the benefits but the determination was overturned on appeal, you will have to repay those benefits plus interest. Potentially, you could owe thousands of dollars, and if you agreed to repay monthly over several years or more, you may owe even more money in interest.

What can you do? The Employment Security Act does provide a waiver of repayment, but only if you were not at fault and with any of the following three grounds: 1) you provided incorrect wage information and your former employer didn’t provide or correct that information, and you didn’t intentionally misrepresent, 2) your household income is below the Federal poverty guidelines, and 3) the UIA committed an administrative or clerical error but this expressly does not include those errors overturned in an administrative law judge, appeals or judicial determination. M.C.L. 421.62(a).

Besides these limited grounds for a waiver, there is some possibility that you contest repayment especially in cases where the employer did not protest in a timely fashion or not at all, or that other statutory and administrative procedures were not followed. Be sure to timely request a determination and appeal on this issue.

Questions about unemployment benefits in Michigan: contact me at email@robertlreilman.com

NOTE: please keep in mind that this blog is not meant to be legal advice. Consult a lawyer if you need legal advice.

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