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Employers have been bombarded with an explosion of imposter claims in the last three years . While employers struggle to help employees who have fallen victim to this scam and ensure their company ’ s account is not charged for the fraudulent benefits , we ’ ve seen little action from the UIA to prevent or correct the problem .
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Over the course of seven months , the group came to agreement on a comprehensive package of bills incorporating both employer and claimant priorities for the reform of Michigan ’ s unemployment system . This balanced solution will solve the concerns manufacturers have with a system financially supported by the very employers being unfairly targeted .
House Bipartisan Legislative Package on Unemployment Insurance Fraud
MMA-supported legislation to be introduced in mid-October would :
1 . Prevent Imposter Claims The legislation would dramatically strengthen the UIA ’ s identity verification processes by arming the Agency with greater information , including driver ’ s license or state identification numbers , I-9 documentation and employer federal ID number , with which to verify a claimant ’ s identity . To prevent fraudulent payments to identity thieves , the UIA would have to verify a claimant ’ s identity before making any payment on a claim .
2 . Create an Imposter Claim Reporting Process The UIA would be required to establish a prompt and thorough process for handling imposter claim reports and properly informing all interested parties during the process . UIA would be able to stop all payments and nullify the claim upon a finding of identity theft . A statutorily required position would be created at the UIA to tackle imposter fraud , as well as work to improve the integrity and accountability of the UIA through improved administrative policies , practices and procedures . An annual report to the Legislature regarding Michigan ’ s imposter claims will provide insight into the true extent of the problem .
3 . Improve the Section 20 ( a ) Employer Noncompliance Process Legislation would clearly define how the UIA administers the Employer Noncompliance process , utilizing statutorily defined terms and a consistent communication method . Employers will be notified each time the UIA believes that they failed to respond , rather than wait for the consolidated annual determination to be issued . Employers would also be allowed to establish good cause for failure to respond and avoid additional penalties .
4 . Redefine Michigan ’ s Unemployment Fraud Penalties Penalties would be adjusted to provide for a 100 percent penalty for a first offense , 150 percent penalty for subsequent offense and 400 percent penalty for fraud involving identity theft . This will maintain Michigan ’ s role as having one of the strongest fraud penalties in the nation to deter fraud while still reasonably allowing individuals to pay for their crimes .
5 . Encourage Prompt Repayment of Overpayments and Prevent Punitive Treatment in the Case of Error The legislation will ensure no interest will be assessed in cases of UIA error ; that in cases not involving fraud , interest would begin accruing one year after the restitution order is final ; and , in cases of fraud , the current 1 percent monthly interest would be applied .
Get More !
See mimfg . org for updates , including bill numbers and timelines for legislative action . Subscribe to MMA ’ s MFG Voice e-newsletter for regular updates .
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6 . Improve Access to UIA Advocacy Program Subject to available funding , the UIA would be prohibited from excluding someone from an advocacy program for being accused of fraud . If the person is finally determined to have committed fraud , they would have to repay the program for representation fees relating to their case .
7 . Ensure Claimants Receive Timely Notice The legislation would allow a claimant to request a reconsideration within one year of the original determination , or within three years if the case involved fraud , if they can produce evidence that notice was sent to an incorrect address . If a determination includes a finding of fraud , the bills require the UIA to do a more intensive address search and require the claimant to notify the UIA if he or she moves during a benefit year .
8 . Clarify Michigan ’ s Existing Hardship Waiver A person ’ s average net household income and household cash assets exclusive of social welfare benefits would have to be at or below 150 percent of the federal poverty limit to qualify for a hardship waiver and waiver applications will be allowed only once every six months . The UIA must submit an annual report to the Legislature on the use of the hardship waiver .
Get Involved
Your business is at-risk and now is the time to voice your support for this MMA-driven solution . Contact your local Senator or Representative and tell them to support strong reform to Michigan ’ s unemployment system .
For further involvement , join the MMA Employment & Workforce Policy Committee or contact MMA ’ s Delaney McKinley , at mckinley @ mimfg . org or 517-487-8530 , for more information . 6