Legislature to Attack Unemployment Insurance Debt 

Later this week, the State House and Michigan Senate are expected to begin hearing testimony on solutions to Michigan's unemployment insurance crisis. The Michigan Chamber will be testifying in support of efforts to comprehensively address repayment of the over $3.5 billion Michigan owes to the federal government for it's 100 percent employer-financed Unemployment Insurance (UI) Trust Fund. Left unchecked, reimbursements of these borrowed funds, plus interest, will automatically trigger higher, across-the-board, state and federal UI tax increases on employers for years to come.
 
Restoring the financial solvency of the UI trust fund, with a focus on lasting cost-saving reforms, is a top priority for the Michigan Chamber. Historically, the Michigan Chamber has acted proactively and aggressively in such debates, upholding board policy in support of preserving the financial solvency of the UI Trust Fund. 
 
Due to the size and scope of the debt, and the impending state and federal tax increase, doing nothing isn't an option. The Michigan Chamber will voice support for strong cost-saving reform measures, including:
 

• Vigorous work search requirements;
   
• Increased recovery of fraudulent payments and other overpayments;
   
• Increased disqualification events;
   
• A higher burden of proof on claimants; and
   
• Measures to require claimants to accept reasonable job offers or risk losing benefits.
   

The Chamber will also support bonding for the $3.5 billion debt, which will allow Michigan to repay the federal loan and replace state and federal penalties with a new bond assessment.
 
Please contact Wendy Block, Director of Health Policy and Human Resources, with questions at 517/371-7678 or wblock@michamber.com.  

Senate to Begin Work on Workers' Compensation Legislation

The Senate Reforms, Restructuring and Reinventing Committee is slated to begin testimony on legislation to update, clarify and modernize Michigan's workers' compensation law. House Bill 5002, which passed out of the full House last week, is a fair compromise bill, balancing the needs of injured workers and employers who finance the system.
 
HB 5002 seeks to address a long-standing problem with Michigan's workers' compensation system, mainly that the result of each case largely depends on what judge hears it. This has led to inconsistency, confusion and ambiguities for injured workers and high premiums for job providers. HB 5002 would put an end to the madness and flip-flopping.

Specifically, HB 5002:
 

• Clarifies the definition of "personal injury" to ensure that compensation is available to individuals with injuries that arise out of and in the course of employment and that personal injuries not connected to employment are not compensable. 
   
• Clarifies the definition of "disability," "wage earning capacity," and "wage loss." The goal of the workers' compensation system is to return injured workers to the workplace when they are able. HB 5002 specifies that partially injured workers have a duty to seek work and try to reattach themselves with the workplace. If the claimant deliberately elects not to actively seek work - or refuses jobs that are reasonably available - he or she would see a reduction in his or her benefits. 
   
• Acknowledges advancements in medical technology by allowing medical implants to be taken into account when evaluating the use of body members. Michigan's 100 year-old statute does not contemplate medical implants or replacements. So despite a successful joint replacement surgery that was paid for by the employer, a loophole exists in the law that allows a person to collect weekly wage benefits even after being made whole medically. HB 5002 fixes this unfair loophole. 
   
• Allows for coordination of benefits between individuals eligible for employer-provided pension or retirement benefits and workers' comp benefits. Coordination of benefits already exists between employer-provided pension/retirement benefits and workers' comp benefits. HB 5002 prohibits an eligible individual from postponing retirements so to avoid coordination, putting him or her in a better position than a similarly positioned pensioner. 
   

Significant efforts were made in the House to address the concerns raised by various interest groups, but personal injury attorneys and labor unions still strongly oppose this legislation. 
 
The Michigan Chamber will remain aggressively involved in this issue as it moves forward, urging lawmakers to support this important legislation. 

For further information, visit the Michigan Chamber Briefing Center, or contact Wendy Block at 517/371-7678 or wblock@michamber.com.