Dec. 6, 2024 | This Week in Government: Senate Votes to Extend UI Benefits From 20 Weeks to 26 Weeks, Boost Maximum by 70%

Senate Democrats took their first steps Thursday to increase the number of weeks unemployed persons can obtain state benefits from 20 weeks to 26 weeks and increasing the maximum weekly benefit.

Senators passed SB 40 by a 21-15 vote, which would reverse a 2011 reduction that was enacted under a Republican-controlled Legislature from 26 to 20 weeks.

As passed, the bill would also increase the weekly benefits for unemployed persons from $362 to $614 per week, adjusted for inflation and retroactive from the last increase in 2002. It would be phased in over two years and then tied to consumer price index inflation.

Opponents of the bill said it would place significant financial burdens on employers and could lead to job losses, benefit cuts, and price increases. Unemployment benefits are funded through the State Unemployment Tax on employers.

The Legislature also passed four other bills (SB 962, SB 975, SB 976, and SB 981) by votes of 21-15 that would make several changes to Unemployment Insurance Agency processes dealing with various exemptions and applications processes.

Sen. Ed McBroom (R-Vulcan) was the lone Republican to vote for the bills.

Sen. Thomas Albert (R-Lowell) said he believed SB 962, SB 975, SB 976, and SB 981 have some positive elements, but they do not enact needed improvements to processing claims that became obvious during the coronavirus pandemic. But his main objection was that the bills are tie-barred to SB 40.

“We should not be adopting policies that further raise costs for job providers when they are already reeling from the same inflationary pressures and other economic factors that all Michiganders have faced for the last few years,” Albert said.

Sen. John Cherry (D-Flint) told reporters after session that the benefits offered in Michigan are less than all other Midwest states and the maximum weekly benefits had not been raised since the early 2000s.

“Ultimately, this helps make sure we have a stable population,” Cherry said. “That money goes straight back into the economy, and it’s really a buffer for folks who need it.”

Senate Minority Leader Aric Nesbitt (R-Porter Township) told reporters there are major challenges remaining with the Unemployment Insurance Agency.

“What they passed today doesn’t do anything, doesn’t fix the problems that’s there,” Nesbitt said.

Testimony on SB 40 was divided Thursday prior to it being reported from the Senate Labor Committee.

Amanda Fisher, Michigan state director for National Federation of Independent Business, opposed the bill.

“The biggest thing we have to look at … is that this is 100% employer funded,” Fisher said. “A huge concern is that this benefit increase is too far too fast.”

A Senate Fiscal Agency analysis showed that $763.1 million was paid out during the last year in unemployment insurance benefits. If the total had been 26 weeks, that total could have been between $839.4 million and $867.6 million.

Michigan Building Trades President Steve Claywell said other Midwest states have more generous benefits and employees are leaving for other states.

“The reality in our world it’s not if it’s when we work ourselves off a job,” Claywell said. “Our members should not have to choose between foreclosure, food, family or living in Michigan,” Claywell said.

David Worthams, director of employment policy for the Michigan Manufacturers Association, in a statement said the changes proposed in SB 40 would come at a huge cost to employers.

“Increasing the weekly maximum benefits with an undefined cost to Michigan job providers is irresponsible and will threaten the state’s competitiveness compared to neighboring states,” Worthams said. “Michigan manufacturers will be facing a powerful disadvantage.”

Significant proposed changes to the state’s workers’ compensation law drew pushback from business organizations Thursday in response to testimony from supporters that it would improve employees’ access to benefits and reduce hurdles.

No vote was taken with the Senate Labor Committee short of members.

Those backing the bills said the changes would reverse 2011 laws based on past Supreme Court decisions they say made it more difficult for workers to obtain benefits. Opponents of the bills countered it would dramatically upend a law that dates back more than a century.

Robert MacDonald, an attorney specializing in workers’ compensation and disability cases, told the committee that SB 1079 and SB 1080 would return fairness to the system for workers.

“This is really rolling back to what we had before,” MacDonald said.

Wendy Block, senior vice president for the Michigan Chamber of Commerce, said that’s not the case.

“It doesn’t simply turn back the clock to 2011. … We believe that it goes much further than that, and it will surely lead to higher workers’ compensation costs,” Block said.

Under SB 1079, the maximum weekly rate of compensation for injuries occurring during a calendar year would rise to 100% of the state average weekly wage as of the prior June 30, adjusted to the next higher multiple of $1.

If a person’s health or dental insurance or both are discontinued during the disability, the value of the lost insurance would also have to be included in the calculation of the employee’s average weekly wage, regardless of whether the calculation results in an amount that is greater than two-thirds of the state average weekly wage at the time of the injury.

Language setting the weekly loss in wages as of the time of the person’s injury is also deleted under the bill.

Changes to compensation for death resulting from personal injury would be made under SB 1080.

If a death resulted from the personal injury of an employee, the employee’s spouse living with the employee at the time of death would be conclusively presumed to be wholly dependent on the employee’s earnings for support for 208 weeks after the date of death.

Spouses presumed to be wholly dependent on a dead employee’s earnings would be required to be paid for 500 weeks after death if the spouse established an entitlement to ongoing weekly compensation payments and did not remarry.

Maximum funeral and burial expenses an employer must pay following an employee’s death that was from a personal injury would double from $6,000 to $12,000.

Gerald Marcinkoski, an attorney who was involved in crafting the 2011 changes to the workers’ compensation law, said the bills go too far.

“This bill is dismantling some fundamental pillars of workers’ compensation that have been in place for over 100 years,” Marcinkoski said.

Sherry Searcy, wife of the late Deputy Bryant Searcy, spoke in support of SB 1080. Bryant Searcy was a Wayne County Sheriff’s Office corporal who was murdered by an inmate at the Wayne County Jail in 2020.

She explained that they both worked full-time jobs and that the financial fallout of her husband’s death has been significant. She said despite her husband having provided about 60% of their household income, the workers’ compensation system is structured so that she was considered a partial dependent and only had access to 17% of income in benefits.

“This is not right, and it needs to be changed,” Sherry Searcy said.

A divided Senate on Thursday voted on party lines to pass a bill supporters say would revive Michigan’s consumer protection statute that was largely nullified in a 1999 court ruling.

The bill stems from a 1999 Michigan Supreme Court ruling that held that the language in the Consumer Protection Act protected all businesses from litigation, as long as the conduct in question was part of a legal transaction.

Under the ruling this meant if the business sold a product to a customer, any alleged misconduct in how it sold that product was irrelevant.

Supporters of SB 1022, which passed 20-16, have said the ruling gutted the law.

The bill’s passage drew praise from bill sponsor Sen. Sam Singh (D-East Lansing) and Attorney General Dana Nessel in statements, with countering statements from business groups saying the bill could lead to legal woes for businesses.

“For far too long now, residents in every part of Michigan have suffered the impact from living in what is now known as the worst state in the country for consumer protection laws,” Singh said. “This legislation would restore the power once held in our Consumer Protection Act – bringing us in line with most other states – and ensure that bad actors are held accountable.”

Amanda Fisher, Michigan State Director of the National Federation of Independent Business, said the changes would open businesses up to frivolous lawsuits.

“These businesses are already regulated and overseen by state and federal agencies, whose job is, in part, to protect consumers,” Fisher said. “These agencies can levy fines, require changes to businesses practices, and even order a business closed. Given the regulation and oversight that already exist, those benefiting most from SB 1022 are trial lawyers, not consumers.”

Nessel said SB 1022 would assist consumers who are at the mercy of companies with predatory business practices.

“Sadly, my office has been forced to turn away these consumers because they were victimized by businesses that are licensed and regulated,” Nessel said. “Thanks to the senators who supported this vital legislation, we are now one step closer to closing this loophole and breathing life back into the Michigan Consumer Protection Act.”

David Worthams, director of employment policy for the Michigan Manufacturers Association, echoed Fisher’s stance on the bill.

“Businesses thrive on predictability, but Senate Bill 1022 undermines the stable and balanced precedent in place for the last 25 years,” Worthams said. “If this bill moves forward, manufacturers and other businesses will be subjected to an onslaught of legal risks.”

The United Auto Workers (UAW) said Thursday it opposes legislation to change the voter-initiated paid sick time law set to take effect in February.

Several unions, including the UAW, already had announced opposition to changing the other 2018 voter-initiated law set to take effect in February, raising the minimum wage and phasing out the lower minimum wage for tipped workers, but it and other unions have been quiet about the paid sick leave law.

The sick leave law requires employers with 10 or more employees to provide all employees with 1 hour of sick time for every 30 hours worked up to 72 hours in a year. Employers with less than 10 employees must provide 1 hour of sick time for every 30 hours worked, up to 4 hours in a year with an additional 32 hours in unpaid sick time required.

Time can be used if the employee or employee’s family member is suffering from physical or mental illness, injury, or other health condition or receiving treatment, meetings at a child’s school or place of care related to the child’s health or disability, or if the employee or family member is a victim of domestic violence or sexual assault. Employees would have new abilities to file claims against their employers, and employers could only ask for notice of use of sick time if it was foreseeable.

There also would be significant new recordkeeping requirements for employers.

UAW President Shawn Fain urged legislators in a letter to oppose HB 6057, which would relax several of those requirements, saying the Legislature should not “dilute advancements in wages and benefits for Michigan workers.”

The letter called for action on a wide array of legislation before the Democratic trifecta ends:

• Removing preemption on local labor standards and minimum wages (HB 4231, HB 4237, SB 170, SB 171);
• Enhancing benefits and putting workers in a better position to receive aid under the workers’ compensation law (SB 1079, SB 1080);
• Boosting unemployment benefits (SB 40, HB 5827, SB 962, SB 975, SB 976, SB 981)
• Softening a law limiting how much public employers pay on health insurance (HB 6058);
• Minimum staff ratios for nurses to patients;
• Restore pensions for state workers;
• Paid family leave (SB 332, HB 5474);
• Renter protections;
• Water affordability;
• Eliminate the “dark store” provision in property tax rate setting;
• Prevent regulated corporations like the utilities from making political contributions;
• Assure driver’s licenses for those who lack legal documentation to be in the United States legally; and
• A state voting rights act.

Senators took a first step toward what supporters called an overdue strengthening of the state’s price gouging laws by reporting them to the full chamber Wednesday with several adopted changes.

The bills (SB 954, SB 955, and SB 956) as introduced would set a 10% cap on price increases during a state of emergency before an individual or business would be liable for price gouging, with exceptions. The bills focus on lodging, the cost of goods and emergency supplies, as well as energy products including gasoline.

Currently, 34 states and Washington, D.C., have some form of price gouging laws in place.

The Senate Finance, Insurance, and Consumer Protection Committee voted 5-2 along party lines to report the bills. Each bill was reported with an S-1 substitute.

“I believe the changes made in the substitutes reflect the best possible version of this legislation,” lead bill sponsor Sen. Jeremy Moss (D-Southfield) said. “I’m confident that with these substitutes we have struck the fair balance between consumer protections and providing clear and fair guidelines for the business community.”

For SB 955, language was added clarifying that price gouging provisions only would apply in counties, cities, or townships subject to a declared state of emergency. Further language would allow the attorney general to end enforcement of the price gouging statute if the market has returned to normal conditions.

Another provision would provide an exemption beyond 10% if it was done by retailers that were previously selling products for sale below cost, if the increased prices would bring them up to the actual cost of the item.

Further language would allow investigations into alleged price gouging confidential until a violation has been found.

The word “seasonal” was eliminated from a provision of SB 954, which would ensure the statute does not affect regularly scheduled prices, such as hotel prices that fluctuate during the week.

Municipal power generators and electric cooperatives were also granted the same exemption under SB 956 as traditional energy producers.

The committee separately took testimony only on legislation that would have Michigan join 43 other states that allow benefit corporations, or B-corporations, to incorporate.

Benefit corporations are corporations focused on a general public benefit or a specific public benefit including economic opportunity, environmental protection, or improving public health.

“The right to be legally recognized as a benefit corporation does not currently exist in Michigan,” Sen. Sean McCann (D-Kalamazoo), sponsor of SB 666 and SB 667, said.

Not being able to incorporate could leave such corporations open to liability lawsuits by shareholders if the corporation engages in its social or environmental goals and not solely on profit.