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UIA may pause collections for claimants told they were overpaid benefits

During a joint oversight hearing Thursday, UIA's director said she reached out to the federal government for information on pausing collections.

LANSING, Mich. — Thursday, a joint oversight committee hearing grilled new Unemployment Insurance Agency (UIA) director Julie Dale about the agency losing billions in fraudulent and misrepresented claims. 

During the hearing, Dale said she has spoken with the federal government to learn how to pause collections for people who were told they overpaid.

"What we don't want to do, right, is that we don't want to go ahead and allow the collections activity to continue to allow garnishment to occur," said Dale. "And then two months later, after someone's income tax rate has been garnished to say, 'Oh, by the way, you should have been waived.'"

According to the Detroit Free Press, the UIA hopes to have guidance for claimants asked to repay by the end of the month. 

In 2021, an audit found the UIA overpaid $8.3 billion in fraudulent claims. Many Michiganders were sent letters saying they owed the state money back.

Gov. Gretchen Whitmer issued an executive order calling for the creation of an Unemployment Insurance Fraud Response Team, which would catch and prevent future cases of unemployment insurance fraud.

Rachel Manning, a West Michigan mom of three, received one of those letters. The UIA claimed she was no longer eligible and required to pay back nearly $44,000. 

"I was like, this has got to be a mistake," said Manning. "We did everything we thought we were supposed to." 

The cosmetologist could not work in 2020, and applied for benefits. 

"I don't know if we would have made it without it," she said. 

After receiving the letter, Manning sent in the protest paperwork. However, on Monday, she was told the UIA never received it. She said she sent it via certified mail. 

"So, I checked the tracking today, and it was definitely delivered on December 31st," said Manning. 

She said the situation is stressful, because she feels like fighting the government never goes well. 

"It’s just outrageous," said Manning, "because you’re doing everything you're supposed to do, you’re promised by the government it will be OK. You’re not allowed to work, so you’re doing the best you can, but you still have a family to take care of."

The state has laid out steps to fight incorrect claims of overpayment, but if not addressed quickly or correctly, the UIA website states it could result in the following: 

  • Garnishment of your wages.
  • Interception of your federal and State of Michigan income tax refunds.
  • Forfeiture of lottery winnings over $1,000.
  • Referral for criminal prosecution as a felony.
  • Denial of future jobless benefit payments.

Before it gets to that point, there are a few ways to fight those letters. Most can be done online through the state's MiWAM, or Michigan Web Account Manager.

The information below is taken directly from the Unemployment Agency's Website, and can be found by clicking this link

Can I Protest An Overpayment Decision?

If you disagree with the determination or redetermination on whether you are eligible to receive benefits, you may submit a statement protesting the decision. You have 30 days from the date on determination or redetermination letter mailed to you to explain why you disagree with the decision. If it's beyond the 30 days, you also need to explain why you missed the deadline. See Page 81 of the MiWAM Toolkit for Claimants for details.

You submit a protest through your MIWAM account:

  1. Click on the PUA claim ID to view the details.
  2. Click on "Determination Status", and then on "file a protest" or "file appeal" for the issue you wish to protest.
  3. Complete all the required fields and use the "add" feature to include any documentation or evidence you would like to include with your protest.
  4. When you file a protest, do not request at the same time a hardship waiver (see below). A waiver cannot be considered until a restitution decision is finalized.

An administrative law judge will make a ruling in your case.

What If I Lose My Protest And Appeal?

You can request a restitution waiver for financial hardship. You can make the request from the UI Claim screen in MiWAM under the Claimant Services tab. When you file a protest, do not request at the same time a hardship waiver. A waiver cannot be considered until a restitution decision is finalized. You can only apply for a waiver every six months. Continue to monitor your MiWAM account and make sure your contact information is updated in case you are contacted for additional information. See Page 89 of the MiWAM Toolkit for Claimants for instructions on how to request a hardship waiver.

How Long Does The Protest Process Take?

Due to the high volume of claims and dependent on UIA staff workloads, this process may take longer than under normal circumstances. Ideally, protests can take 30 days to be resolved, but often take longer. Check your MiWAM account for status updates.

What If My Waiver Is Denied?

You can protest the waiver denial by filing UIA Form 1795. If again denied, contact the UI Benefit Overpayment Collection Unit at 1-866-500-0017 or go through your MiWAM account to arrange repayment terms. Interest is charged on overpayments at a rate of one percent per month, accruing daily until the total amount due is paid.

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