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House Bill 5166

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House Bill 5166

Topic: Fraud Penalty
Sponsor: Representative Kevin Hertel (D)
Introduced: October 24, 2017
Status: Waiting to take effect
Effective Date: July 1, 2018

ISSUES WITH CURRENT LAW: Michigan’s current penalty rate for unemployment insurance fraud is up to 400% of the overpayment.

WHAT THE NEW BILL DOES:

  • To impose fairer penalties for fraud (excluding identity fraud), the new bill establishes a penalty that is:
    • 100% of the overpayment for the first instance of fraud
    • 150% of the overpayment for subsequent instances of fraud
  • For impostors who commit identity fraud, the penalty will be equal to 400% of the overpayment.

HOW THE NEW BILL HELPS CLAIMANTS:

  • Establishes a fairer and more reasonable penalty for unemployment insurance fraud.
  • Establishes a penalty that is closer to, but still higher than, other states’ fraud penalties.

House Bill 5171

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House Bill 5171

Topic: Hardship Waivers
Sponsor: Representative Phil Phelps (D)
Introduced: October 24, 2017
Status: Waiting to take effect
Effective Date: March 21, 2018

ISSUE WITH CURRENT LAW: As of 2013, the Agency must grant a claimant’s hardship waiver application if the claimant’s disposable household income falls below the Federal Poverty Line. However, the Agency does not currently comply with the 2013 change.

WHAT THE NEW BILL DOES:

  • The Agency must grant a claimant’s hardship waiver application if the claimant’s average net household income and household cash assets falls below 150% of the Federal Poverty Line.
  • The claimant may only apply for a waiver once every 6 months.
  • The Agency must present a written report to the legislature detailing the previous year’s statistics on waivers.

HOW THE NEW BILL HELPS CLAIMANTS:

  • Increasing the threshold to 150% will enable more claimants to qualify for hardship waivers.
  • The Agency’s written annual report will enable claimants’ advocates to ensure the Agency is complying with the text of the bill and is properly issuing hardship waivers.

House Bill 5170

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House Bill 5170

Topic: Employer Determination Process
Sponsor: Representative Joseph Bellino (R)
Introduced: October 24, 2017
Status: Effective as of January 1, 2018

ISSUE WITH CURRENT LAW: The Agency’s process for employer determinations was confusing, time consuming, and ineffective.

WHAT THE NEW BILL DOES:

  • An employer receives a determination if the employer fails to provide timely and adequate information in response to the Agency’s request(s) for information.
  • To receive a determination, an employer must (a) fail to respond 5 or more time to requests for information OR (b) fail to respond to equal to or greater than 2% of all the requests received during the prior calendar year.
  • Benefits paid to a claimant as a result of the employer’s or employer’s agents failure to provide timely or adequate information must be charged to the employer’s account and the employer’s account must not be credited.

HOW THE NEW BILL HELPS CLAIMANTS:

  • The bill seeks to achieve a balance in the system by holding employers accountable for their interactions with the Agency.
  • The bill enables claimants to collect unemployment benefits even if their employer fails to respond to Agency’s requests for information.

House Bill 5169

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House Bill 5169

Topic: Interest on Overpayments
Sponsor: Representative Beau LaFave (R)
Introduced: October 24, 2017
Status: Effective as of December 21, 2017

ISSUE WITH CURRENT LAW: Michigan charges 1% monthly interest on all overpayments.

WHAT THE NEW BILL DOES:

  • No interest will be assessed if the overpayment was due to an Agency error.
  • Interest begins accruing one year after a final adjudication if there was a non-fraud overpayment not caused by Agency error.
  • Interest applies immediately if fraud is found.

HOW THE NEW BILL HELPS CLAIMANTS:

  • Claimants who were overpaid due to Agency error no longer have to pay interest on the restitution owed to the Agency. This saves claimant’s enormous money and rightfully places the burden on the Agency for its own errors.
  • The new bill provides a one year window to claimants before interest accrues in non-fraud overpayment situations. This enables claimants to pay off the restitution owed before interest begins to accrue.

House Bill 5165

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House Bill 5165

Topic: Identity Theft Verification Structure
Sponsor: Representative Joseph Graves (R)
Introduced: October 24, 2017
Status: Waiting to take effect
Effective date: March 21, 2018

ISSUES WITH CURRENT LAW: The Agency lacks clear procedures to verify impostor theft claims.

WHAT THE NEW BILL DOES:

  • In order to efficiently and effectively combat identity fraud, this bill establishes a new system that will enforce timely reviews of submitted affidavits by either the employer, the worker, or both parties.
  • Creates an “Inspector General” tasked with reviewing administrative policies, practices, and procedures, specifically those that the Unemployment Agency has adopted to mitigate the incidence of claims submitted by impostors. The Inspector General will also make recommendations to improve the procedures, integrity, and accountability within the Agency.

HOW THE NEW BILL HELPS CLAIMANTS:

  • Provides a clear path to relief for claimants who suffer from impostor theft
  • The Inspector General will serve as a voice for claimants to ensure the Agency’s procedures are efficient and fair, preventing the occurrence of another scandal like RoboFraud.

 

 

Wickham v. Adecco CS, Inc. – 18.23

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Wickham v. Adecco CS, Inc.
Digest No. 18.23

Section 421.32(a)

Cite as: Wickham v Adecco CS, Inc, unpublished opinion of the Michigan Administrative Hearing System, issued September 28, 2016 (Docket No. 16-021211).

Appeal pending: No
Claimant: Margaret M. Wickham
Employer: Adecco CS Inc.
Date of decision: September 28, 2016

View/download the full decision

HOLDING: Under Michigan law, when pleading a cause of action involving fraud, the circumstances alleged to must be stated with particularity. In addition, in a fraud case, due process of law is violated when a claimant is not apprised of when, why, or how her actions constitute intentional misrepresentation of material fact.

FACTS: Claimant received a November 21, 2014 adjudication that concludes that Claimant’s “actions” indicate that she intentionally misled and/or concealed information to obtain benefits to which she was not otherwise entitled.

DECISION: The November 21, 2014 adjudication is facially defective as a matter of law, so it is void, set aside, vacated, and dismissed. Therefore the Agency’s denial of reconsideration concerns an invalid underlying adjudication, so it must also be set aside, vacated, and dismissed as a matter of law.

RATIONALE: The November 21, 2014 adjudication includes no factual assertions in support of the vague generalized legal conclusion that Claimant’s “actions” indicate that she intentionally misled and/or concealed information to obtain benefits to which she was not otherwise entitled. The Agency’s omission of particularized factual assertions in support of its legal conclusions violates Michigan law concerning the pleading of causes of action including fraud. Kassab v Michigan Basic Property Insurance Association, 441 Mich 433 (1992) requires that, when pleading a cause of action involving fraud, the circumstances alleged to must be stated with particularity. Section 421.32(a) requires the Agency to examine claims and render determinations on the facts; the Unemployment Insurance Agency lacks jurisdiction to render adjudications containing summary legal conclusions unsupported by factual assertions. In addition, the November 21, 2014 adjudication violates the demands of due process of law by failing to apprise Claimant of when, why, and how her “actions” constitute intentional misrepresentation of material fact.

Digest author: Winne Chen, Michigan Law, Class of 2017
Digest updated: November 26, 2017

 

Logan v. Manpower of Lansing, Inc.

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Logan v. Manpower of Lansing, Inc.

Section 29(1)(a)

Cite as: Logan v Manpower of Lansing, Inc, unpublished opinion of the Court of Appeals of Michigan, Issued March 13, 2014 (Docket No. 311167).

Appeal Pending: No
Claimant: Janice Logan
Employer: Manpower of Lansing, Inc.
Docket no.: 311167
Date of decision: March 13, 2014

View/download the full decision

Holding: The Court of Appeals held that claimant voluntarily left work without good cause attributable to the employer when she quit her employment at a temporary staffing agency to take part-time employment after being on medical leave.

Facts: Claimant began working for a temporary staffing agency, Manpower of Lansing, Inc. (“Manpower”) in April 2008. She was assigned to work part-time at Pennfield Animal Hospital (“Pennfield”). Claimant went on medical leave in August 2008. When claimant was ready to return to work in October 2008, she began working for Pennfield as a direct hire. The ALJ ruled that claimant was disqualified for benefits under MCL 421.29(1)(a) because “she abandoned her job with Manpower and took a part-time job with the client company.”

On appeal claimant asserted that she left Manpower to accept full-time work, which would implicate the exception in MCL 421.29(5) to the rule in MCL 421.29(1), which disqualifies a person from receiving benefits for voluntarily leaving work. On remand, the ALJ found that claimant quit her job with Manpower in order to accept permanent, part-time employment with Pennfield. The Calhoun Circuit Court affirmed.

Decision: The Court of Appeals affirmed the decision on the Circuit Court.

Rationale: The Court of Appeals found that “the statute [MCL 421.29(1)(a)] does not refer to work that is unconnected to the employer; instead, the work is linked to a particular employer unit or employing unit, and when the relationship with that particular employer or employing unit ends, the work at issues necessarily also ends.”

Additionally, the court declined “claimant’s invitation to view a temporary-staffing firm and its client as a ‘joint employer’ or a single ‘employing unit,’” because claimant could not show “how Manpower was an agent (or employee) of Pennfield or vice versa.”

Digest author: James C. Robinson
Digest updated: 2/15