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Michigan lawmakers first to try to balance the relief and pain between employers and job seekers

03-31-2011

 LANSING, Mich. (AP) — Thousands of unemployed people in Michigan could continue receiving extended federal unemployment benefits under a plan approved by state lawmakers Wednesday, though state-level benefits would be limited for people filing new jobless claims next year.  The legislation is House Bill 4408.

 

The extended benefits come through a federally-funded program that provides up to 20 weeks of payments to unemployed people who have exhausted state benefits and some types of federal benefits. Those extended benefits are set to expire for 35,000 Michigan residents in early April, and for 150,000 residents by the end of 2011.

 

The current system, including temporary federal extensions, allows some Michigan workers to get jobless benefits for up to 99 weeks. That would drop if state benefits are available for a shorter time, depending on when workers enter the unemployment benefits system.  Under the bill approved by Michigan lawmakers, residents making initial claims for unemployment benefits starting in mid-January 2012 would be eligible for no more than 20 weeks of state benefits while the current maximum is 26 weeks.

 

Some legislators said the change would save Michigan employers about $600,000,000 a year. Michigan residents would still be eligible for whatever federal extensions are available when they exhaust their state benefits.  The bill now goes to Gov. Rick Snyder who is expected to sign it, the governor's priority being “to make sure no one receiving unemployment benefits was cut off abruptly”, according to a spokesperson.

 

Other legislators claim the bill hurts workers: "It doesn't help them" and the move "the ultimate slap in the face to our unemployed workers."  Others said the plan makes sense, given the poor financial shape of the state's unemployment insurance system. Michigan has had to ask for more than $3,800,000,000 in federal loans to cover the cost of unemployment benefits over the past two years. 

 

The legislation approved Wednesday also includes measures designed to fight fraud, which supporters say could prevent the loss of more money; a reading of the legislation suggests the majority of the language in the bill is related to fighting fraud.  The reduction to 20 weeks of benefits from 26 weeks is but one sentence in the bill:

 

FOR EACH ELIGIBLE INDIVIDUAL FILING AN INITIAL CLAIM ON OR AFTER JANUARY 15, 2012, NOT MORE THAN 20 WEEKS OF BENEFITS OR LESS THAN 14 WEEKS OF BENEFITS SHALL BE PAYABLE TO AN INDIVIDUAL IN A BENEFIT YEAR.

 

 Link to bill: http://www.legislature.mi.gov/documents/2011-2012/billconcurred/House/pdf/2011-hCB-4408.pdf.

 

Senate Majority Leader Randy Richardville stated "We think that's real good help for those folks that are unemployed, but at the same time, we need to give some relief to businesses that are paying these bills."

Other states are reported to be considering similar legislation to reduce the number of weeks of unemployment benefits to stem the tide of red ink in state budgets.

 

Source of original news: March 23, 2011, 10:19 p.m. EDT, Associated Press

 

UPDATE - HR 4408 became Michigan Public Act 14 on March 29, 2011.