The Governor and the state Unemployment Insurance Agency (UIA) said a change in federal rules is why hundreds of thousands of Michigan claimants now must provide information to see if they still qualify for the benefits.
Gov. Gretchen Whitmer referred to the matter as a “paperwork issue,” which involves the UIA reaching out to more than 648,000 people affected by the new standards, according to The Detroit News earlier this week.
According to the UIA Wednesday, when the pandemic hit, “there was ambiguity in the federal guidelines and more latitude was given in the interpretation of those guidelines by the states.” But the U.S. Department of Labor has become “more prescriptive” over time as to what can and cannot be included for eligibility reasons.
Specifically, four COVID-19 eligibility reasons for federal unemployment aid have now been found to be non-qualifying reasons. Those include if a worker had:
– Work hours reduced as a direct result of COVID-19.
– Been seeking part-time employment and affected by COVID-19.
– Had insufficient work history to qualify for regular unemployment compensation and are affected by COVID-19.
– Been unemployed or working less than regular hours as a result of COVID-19 and were denied benefits on another claim.
Whitmer told reporters Wednesday the state isn’t anticipating that everyone affected will have to repay their federal benefits. She said the feds are requiring the state to reach out to people to “give them the opportunity to check one of the boxes that are approved by the federal government so that they don’t have to repay.
“It is a pain, it is frustrating and trust me I would prefer not to go through this,” she said.
Acting UIA Director Liza Estlund Olson said the agency is “doing everything we can to help working families navigate this issue” and that the UIA is also “currently reviewing a waiver process.”
Still, the development was one reason why House Oversight Committee Chair Steven Johnson (R-Wayland) said he’d be launching an “in-depth investigation” into the UIA.
“The Unemployment Agency has been a complete mess. From all the fraudulent activity occurring within the Agency to their latest letter to nearly 700,000 Michiganders potentially demanding they pay funds back, the UIA is a disaster and there needs to be leadership changes now,” he said in a press release.
Both Johnson and the Michigan Freedom Fund linked the possibility of people having to pay their benefits back to the severance payment made to former UIA Director Steve Gray, who resigned last year.
“Gretchen Whitmer paid Steve Gray $86,000 of taxpayer money to keep his mouth shut about the mistakes they made handling the state’s unemployment agency during the pandemic,” said Tori Sachs, executive director of the Michigan Freedom Fund, in a press release. “Returning that disgraceful payment should happen immediately, but it won’t even cover postage for the 648,000 letters the state just sent due to their errors and shutdowns.”