Bill Text: MI HB4408 | 2011-2012 | 96th Legislature | Introduced
Bill Title: Employment security; administration; fraud control measures and benefit and extended benefit period adjustments; implement. Amends secs. 10, 15, 27, 54, 62 & 64 of 1936 (Ex Sess) PA 1 (MCL 421.10 et seq.).
Spectrum: Partisan Bill (Republican 1-0)
Status: (Passed) 2011-04-12 - Assigned Pa 14'11 With Immediate Effect [HB4408 Detail]
Download: Michigan-2011-HB4408-Introduced.html
HOUSE BILL No. 4408
March 9, 2011, Introduced by Rep. Stamas and referred to the Committee on Commerce.
A bill to amend 1936 (Ex Sess) PA 1, entitled
"Michigan employment security act,"
by amending sections 10, 15, 54, and 62 (MCL 421.10, 421.15,
421.54, and 421.62), section 10 as amended by 2003 PA 84, section
15 as amended by 1996 PA 498, section 54 as amended by 2002 PA 192,
and section 62 as amended by 1995 PA 125.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 10. (1) There is created in the department of treasury a
special fund to be known and designated as the administration fund
(Michigan employment security act). Any balances in the
administration fund at the end of any fiscal year of this state
shall be carried over as a part of the administration fund and
shall not revert to the general fund of this state. Except as
otherwise provided in subsection (3), all money deposited into the
administration fund under this act shall be appropriated by the
legislature to the unemployment agency to pay the expenses of the
administration of this act.
(2) The administration fund shall be credited with all money
appropriated to the fund by the legislature, all money received
from the United States or any agency of the United States for that
purpose, and all money received by this state for the fund. All
money in the administration fund that is received from the federal
government or any agency of the federal government or that is
appropriated by this state for the purposes of this act, except
money requisitioned from the account of this state in the
unemployment trust fund pursuant to a specific appropriation made
by the legislature in accordance with section 903(c)(2) of title IX
of
the social security act, 42 U.S.C. 1103 USC 1103(c)(2), and with
section 17(3)(f), shall be expended solely for the purposes and in
the amounts found necessary by the appropriate agency of the United
States and the legislature for the proper and efficient
administration of this act.
(3) All money requisitioned from the account of this state in
the unemployment trust fund pursuant to a specific appropriation
made by the legislature in accordance with section 903(c)(2) of
title
IX of the social security act, 42 U.S.C. 1103 USC 1103(c)(2),
and with section 17(3)(f), shall be deposited in the administration
fund. Any money that remains unexpended at the close of the 2-year
period beginning on the date of enactment of a specific
appropriation shall be immediately redeposited with the secretary
of the treasury of the United States to the credit of this state's
account in the unemployment trust fund; or any money that for any
reason cannot be expended or is not to be expended for the purpose
for which appropriated before the close of this 2-year period shall
be redeposited at the earliest practicable date.
(4) If any money received after June 30, 1941, from the
appropriate agency of the United States under title III of the
social
security act, chapter 531, 49 Stat. 620, 42 U.S.C. USC 501
to 504, or any unencumbered balances in the administration fund
(Michigan employment security act) as of that date, or any money
granted after that date to this state under the Wagner-Peyser act,
chapter
49, 48 Stat. 113 as defined
in section 12, or any money
made available by this state or its political subdivisions and
matched by money granted to this state under the Wagner-Peyser act,
chapter
49, 48 Stat. 113, is found by the
appropriate agency of the
United States, because of any action or contingency, to have been
lost or been expended for purposes other than, or in amounts in
excess of, those found necessary by that agency of the United
States for the proper administration of this act, the money shall
be replaced by money appropriated for that purpose from the general
funds of this state to the administration fund (Michigan employment
security act) for expenditure as provided in this act. Upon receipt
of notice of such a finding by the appropriate agency of the United
States, the commission shall promptly report the amount required
for replacement to the governor and the governor shall, at the
earliest opportunity, submit to the legislature a request for the
appropriation of that amount. This subsection shall not be
construed to relieve this state of its obligation with respect to
funds
received prior to July 1, 1941, under the provisions of title
III
of the social security act, chapter 531, 49 Stat. 620, 42
U.S.C.
USC 501 to 504.
(5) If any funds expended or disbursed by the commission are
found by the appropriate agency of the United States to have been
lost or expended for purposes other than, or in amounts in excess
of, those found necessary by that agency of the United States for
the proper administration of this act, and if these funds are
replaced as provided in subsection (4) by money appropriated for
that purpose from the general fund of this state, then the director
who approved the expenditure or disbursement of those funds for
those
purposes or in those amounts, shall be is liable to this
state in an amount equal to the sum of money appropriated to
replace those funds. The director shall be required by the governor
to post a proper bond in a sum not less than $25,000.00 to cover
his or her liability as prescribed in this section, the cost of the
bond to be paid from the general fund of this state.
(6) There is created in the department of treasury a separate
fund to be known as the contingent fund (Michigan employment
security act) into which shall be deposited all solvency taxes
collected under section 19a and all interest on contributions,
penalties, and damages collected under this act. Except as
otherwise
provided in subsections (7), (8)
, and (9), all amounts
in the contingent fund (Michigan employment security act) and all
earnings on those amounts are continuously appropriated without
regard to fiscal year for the administration of the unemployment
agency and for the payment of interest on advances from the federal
government
to the unemployment compensation fund under section 1201
of
title XII of the social security act, 42
U.S.C. USC 1321, to be
expended only if authorized by the unemployment agency. Money
deposited from the solvency taxes collected under section 19a shall
not be used for the administration of the unemployment agency,
except for the repayment of loans from the state treasury and
interest on loans made under section 19a(3). However, an
authorization or expenditure shall not be made as a substitution
for a grant of federal funds or for any portion of a grant that, in
the absence of an authorization, would be available to the
commission
unemployment agency. Immediately upon receipt of
administrative grants from the appropriate agency of the United
States
to cover administrative costs for which the commission
unemployment agency has authorized and made expenditures from the
contingent fund, those grants shall be transferred to the
contingent fund to the extent necessary to reimburse the contingent
fund for the amount of those expenditures. Amounts needed to refund
interest, damages, and penalties erroneously collected shall be
withdrawn and expended for those purposes from the contingent fund
upon order of the unemployment agency. Any amount authorized to be
expended for administration under this section may be transferred
to the administration fund. An amount not needed for the purpose
for which authorized shall, upon order of the unemployment agency,
be returned to the contingent fund. Amounts needed to refund
erroneously collected solvency taxes shall be withdrawn and
expended for that purpose upon order of the unemployment agency.
(7) There is created in the department of treasury contingent
fund a separate fund to be known as the special fraud control fund
(Michigan employment security act). The special fraud control fund
shall consist of money collected or received by the unemployment
agency as follows:
(a) All interest and penalties collected under section 62.
(b) All gifts to, interest on, or profits earned by the
special fraud control fund.
(c) Amounts credited under section 54(k)(ii).
(8) The money in the special fraud control fund is
continuously appropriated only to the unemployment agency and may
not be transferred or otherwise made available to any other state
agency.
(9) All amounts in the special fraud control fund are to be
used first for the acquisition of packaged software that has a
proven record of success with the detection and collection of
unemployment benefit overpayments and then for administrative costs
associated with the prevention, discovery, and collection of
unemployment benefit overpayments, as included in the biennial
budget of the unemployment agency and approved by the legislature.
The unemployment agency shall submit a report to the clerk of the
house of representatives and the secretary of the senate at the
close of the 2-year period that begins on the effective date of the
amendatory act that added this subsection, to show how the money
from the special fraud control fund was used and the results
obtained from the special fraud control fund.
(7)
On June 30, 2002, the unemployment agency shall authorize
the
withdrawal of $79,500,000.00 from the contingent fund (Michigan
employment
security act) for deposit into the general fund.
(10) (8)
At the close of the state fiscal
year in 2002 and
each year after 2002, all funds in the contingent fund (Michigan
employment security act) in excess of $15,000,000.00 shall lapse to
the unemployment trust fund.
(9)
The unemployment agency shall authorize the withdrawal of
$10,000,000.00
from the contingent fund (Michigan employment
security
act) for deposit into the general fund for the fiscal year
ending
September 30, 2004.
Sec. 15. (a) Contributions unpaid on the date on which they
are due and payable, as prescribed by the commission, shall bear
interest
at the rate of 1% per month, computed on a day to day day-
to-day basis for each day the delinquency is unpaid, from and after
that date until payment plus accrued interest is received by the
commission. Amounts illegally obtained or previously withheld from
payment and damages that are recovered by the commission under
section
54(a) and (b) and sections 54a to 54c of this act shall
bear interest at the rate of 1% per month, computed on a day-to-day
basis for each day the amounts remain unpaid until payment plus
accrued interest is received by the commission. The interest on
unpaid contributions, exclusive of penalties, shall not exceed 50%
of the amount of contributions due at due date. Interest and
penalties collected pursuant to this section shall be paid into the
contingent fund, except that interest and penalties collected under
section 62 shall be paid into the special fraud control fund. The
commission may cancel any interest and any penalty when it is shown
that the failure to pay on or before the last day on which the tax
could have been paid without interest and penalty was not the
result of negligence, intentional disregard of the rules of the
commission, or fraud.
(b) The commission may make assessments against an employer,
claimant, employee of the commission, or third party who fails to
pay contributions, reimbursement payments in lieu of contributions,
penalties, forfeitures, or interest as required by this act. The
commission shall immediately notify the employer, claimant,
employee of the commission, or third party of the assessment in
writing by first-class mail. An assessment by the commission
against a claimant, an employee of the commission, or a third party
under this subsection shall be made only for penalties and interest
on those penalties for violations of section 54(a) or (b) or
sections
54a to 54c. The assessment , which shall constitute a
determination,
shall be is a final determination
unless the
employer, claimant, employee of the commission, or third party
files with the commission an application for a redetermination of
the assessment in accordance with section 32a. A review by the
commission or an appeal to a referee or the appeal board on the
assessment
shall does not reopen a question concerning an
employer's liability for contributions or reimbursement payments in
lieu of contributions, unless the employer was not a party to the
proceeding or decision where the basis for the assessment was
determined. An employer may pay an assessment under protest and
file an action to recover the amount paid as provided under
subsection (d). Unless an assessment is paid within 15 days after
it becomes final the commission may issue a warrant under its
official
seal for the collection of an the
assessed amount.
required
to be paid pursuant to the assessment. The commission
through its authorized employees, under a warrant issued, may levy
upon and sell the property of the employer that is used in
connection with the employer's business, or that is subject to a
notice to withhold, found within the state, for the payment of the
amount of the contributions including penalties, interests, and the
cost of executing the warrant. Property of the employer used in
connection
with the employer's business shall is not be exempt from
levy
under the warrant. Wages subject to a notice to withhold shall
be
are exempt to the extent the wages are exempt from
garnishment
under the laws of this state. The warrant shall be returned to the
commission
together with the money collected by virtue of under the
warrant within the time specified in the warrant which shall not be
less than 20 or more than 90 days after the date of the warrant.
The
commission shall proceed upon the warrant in all respects and
with
like effect and in the same manner as
prescribed by law in
respect to executions issued against property upon judgments by a
court of record. The state, through the commission or some other
officer or agent designated by it, may bid for and purchase
property sold under the provisions of this subsection. If an
employer, claimant, employee of the commission, or third party, as
applicable, is delinquent in the payment of a contribution,
reimbursement payment in lieu of contribution, penalty, forfeiture,
or interest provided for in this act, the commission may give
notice of the amount of the delinquency served either personally or
by mail, to a person or legal entity, including the state and its
subdivisions, that has in its possession or under its control a
credit or other intangible property belonging to the employer,
claimant, employee of the commission, or third party, or who owes a
debt to the employer, claimant, employee of the commission, or
third party at the time of the receipt of the notice. A person or
legal
entity so notified shall not transfer or make a disposition
dispose of the credit, other intangible property, or debt without
retaining an amount sufficient to pay the amount specified in the
notice
unless the commission unemployment
agency consents to a
transfer or disposition or 45 days have elapsed from the receipt of
the notice. A person or legal entity so notified shall advise the
commission
unemployment agency within 5 days after receipt of the
notice of a credit, other intangible property, or debt, which is in
its possession, under its control, or owed by it. A person or legal
entity that is notified and that transfers or disposes of credits
or personal property in violation of this section is liable to the
commission
unemployment agency for the value of the property or the
amount of the debts thus transferred or paid, but not more than the
amount specified in the notice. An amount due a delinquent
employer,
claimant, employee of the commission unemployment agency,
or third party subject to a notice to withhold shall be paid to the
commission
unemployment agency upon service upon the debtor of a
warrant issued under this section.
(c) In addition to the mode of collection provided in
subsection (b), if, after due notice, an employer defaults in
payment of contributions or interest on the contributions, or a
claimant,
employee of the commission unemployment
agency, or third
party defaults in the payment of a penalty or interest on a
penalty,
the commission unemployment
agency may bring an action at
law in a court of competent jurisdiction to collect and recover the
amount of a contribution, and any interest on the contribution, or
the penalty or interest on the penalty, and in addition 10% of the
amount of contributions or penalties found to be due, as damages.
An
employer, claimant, employee of the commission unemployment
agency, or third party adjudged in default shall pay costs of the
action.
An action by the commission unemployment
agency against a
claimant,
employee of the commission unemployment
agency, or third
party under this subsection shall be brought only to recover
penalties and interest on those penalties for violations of section
54(a) or (b) or sections 54a to 54c. Civil actions brought under
this section shall be heard by the court at the earliest possible
date. If a judgment is obtained against an employer for
contributions and an execution on that judgment is returned
unsatisfied, the employer may be enjoined from operating and doing
business in this state until the judgment is satisfied. The circuit
court of the county in which the judgment is docketed or the
circuit court for the county of Ingham may grant an injunction upon
the
petition of the commission unemployment
agency. A copy of the
petition for injunction and a notice of when and where the court
shall act on the petition shall be served on the employer at least
21 days before the court may grant the injunction.
(d) An employer or employing unit improperly charged or
assessed contributions provided for under this act, or a claimant,
employee
of the commission unemployment
agency, or third party
improperly assessed a penalty under this act and who paid the
contributions or penalty under protest within 30 days after the
mailing of the notice of determination of assessment, may recover
the amount improperly collected or paid, together with interest, in
any
proper action against the commission unemployment agency. The
circuit court of the county in which the employer or employing unit
or
claimant, employee of the commission unemployment agency, or
third party resides, or, in the case of an employer or employing
unit, in which is located the principal office or place of business
of
the employer or employing unit, shall have has original
jurisdiction of an action to recover contributions improperly paid
or collected or a penalty improperly assessed whether or not the
charge
or assessment has been reviewed by the commission
unemployment agency or heard or reviewed by a referee or the appeal
board.
The court shall not have has
no jurisdiction of the action
unless
written notice of claim is given to the commission
unemployment agency at least 30 days before the institution of the
action. In an action to recover contributions paid or collected or
penalties
assessed, the court shall allow costs to such an extent
and
in a manner as it may consider it
considers proper. Either
party
to the action shall have has
the right of appeal , as is now
provided
by law , in
other civil actions. An action by a claimant,
employee
of the commission unemployment
agency, or third party
against
the commission unemployment
agency under this subsection
shall be brought only to recover penalties and interest on those
penalties
improperly assessed by the commission unemployment agency
under section 54(a) or (b) or sections 54a to 54c. If a final
judgment is rendered in favor of the plaintiff in an action to
recover the amount of contributions illegally collected or charged,
the
treasurer of the commission unemployment
agency, upon receipt
of a certified copy of the final judgment, shall pay the amount of
contributions illegally collected or charged or penalties assessed
from
the clearing account, and pay interest as may be allowed by
the court, in an amount not to exceed the actual earnings of the
contributions
as may have been found to have been illegally
collected or charged, from the contingent fund.
(e) Except for liens and encumbrances recorded before the
filing of the notice provided for in this section, all
contributions, interest, and penalties payable under this act to
the
commission unemployment
agency from an employer, claimant,
employee
of the commission unemployment
agency, or third party that
neglects
to pay the same when due shall be are a first and prior
lien upon all property and rights to property, real and personal,
belonging
to the employer, claimant, employee of the commission
unemployment
agency, or third party. The lien shall
continue
continues until the liability for that amount or a judgment arising
out of the liability is satisfied or becomes unenforceable by
reason
of lapse of time. The lien shall attach attaches to the
property and rights to property of the employer, claimant, employee
of
the commission unemployment
agency, or third party, whether real
or
personal, from and after the required
filing date that a of the
report
upon which the specific tax is computed. is required by this
act
to be filed. Notice of the lien
shall be recorded in the office
of the register of deeds of the county in which the property
subject to the lien is situated, and the register of deeds shall
receive
the notice for recording. This subsection shall apply
applies only to penalties and interest on those penalties assessed
by
the commission unemployment
agency against a claimant, employee
of
the commission unemployment
agency, or third party for
violations of section 54(a) or (b) or sections 54a to 54c.
If there is a distribution of an employer's assets pursuant to
an order of a court under the laws of this state, including a
receivership, assignment for benefit of creditors, adjudicated
insolvency, composition, or similar proceedings, contributions then
or thereafter due shall be paid in full before all other claims
except for wages and compensation under the worker's disability
compensation
act of 1969, Act No. 317 of the Public Acts of 1969,
being
sections 418.101 to 418.941 of the Michigan Compiled Laws
1969 PA 317, MCL 418.101 to 418.941. In the distribution of estates
of decedents, claims for funeral expenses and expenses of last
sickness shall also be entitled to priority.
(f) An injunction shall not issue to stay proceedings for
assessment or collection of contributions, or interest or penalty
on contributions, levied and required by this act.
(g) A person or employing unit, that acquires the
organization, trade, business, or 75% or more of the assets from an
employing
unit, as a successor defined described
in section 41(2),
is
liable for contributions and interest due to the commission
unemployment agency from the transferor at the time of the
acquisition in an amount not to exceed the reasonable value of the
organization, trade, business, or assets acquired, less the amount
of a secured interest in the assets owned by the transferee that
are entitled to priority. The transferor or transferee who has, not
less than 10 days before the acquisition, requested from the
commission
unemployment agency in writing a statement certifying
the status of contribution liability of the transferor shall be
provided with that statement and the transferee is not liable for
any amount due from the transferor in excess of the amount of
liability computed as prescribed in this subsection and certified
by
the commission unemployment
agency. At least 2 calendar days not
including a Saturday, Sunday, or legal holiday before the
acceptance of an offer, the transferor, or the transferor's real
estate broker or other agent representing the transferor, shall
disclose
to the transferee on a form provided by the commission
unemployment agency, the amounts of the transferor's outstanding
unemployment tax liability, unreported unemployment tax liability,
and the tax payments, tax rates, and cumulative benefit charges for
the most recent 5 years, a listing of all individuals currently
employed by the transferor, and a listing of all employees
separated from employment with the transferor in the most recent 12
months.
This form shall specify such any
other information ,
as
determined
by the commission, as would be the
unemployment agency
determines is required for a transferee to estimate future
unemployment compensation costs based on the transferor's benefit
charge
and unemployment tax reporting and payment experience. with
the
commission. Failure of the
transferor, or the transferor's real
estate broker or other agent representing the transferor, to
provide accurate information required by this subsection is a
misdemeanor punishable by imprisonment for not more than 90 days,
or a fine of not more than $2,500.00, or both. In addition, the
transferor, or the transferor's real estate broker or other agent
representing the transferor, is liable to the transferee for any
consequential damages resulting from the failure to comply with
this subsection. However, the real estate broker or other agent is
not liable for consequential damages if he or she exercised good
faith in compliance with the disclosure of information. The remedy
provided
the transferee is not exclusive, and is not to be
construed
to does not reduce any other right or remedy against any
party provided for in this or any other act. Nothing in this
subsection
shall be construed to decrease decreases
the liability
of
the transferee as a successor in interest, or to prevent
prevents the transfer of a rating account balance as provided in
this act. The foregoing provisions are in addition to the remedies
the
commission unemployment
agency has against the transferor.
(h) If a part of a deficiency in payment of the employer's
contribution to the fund is due to negligence or intentional
disregard
of the rules of the commission unemployment
agency rules,
but without intention to defraud, 5% of the total amount of the
deficiency,
in addition to the deficiency and in addition to all
other interest charges and penalties provided herein, shall be
assessed,
collected, and paid in the same manner as if it were a
deficiency. If a part of a deficiency is determined in an action at
law to be due to fraud with intent to avoid payment of
contributions to the fund, then the judgment rendered shall include
an amount equal to 50% of the total amount of the deficiency, in
addition
to the deficiency and in addition to all other interest
charges and penalties provided herein.
(i) If an employing unit fails to make a report as reasonably
required
by the rules of the commission unemployment
agency
pursuant
to this act, the commission unemployment
agency may make
an
estimate of the liability of
that employing unit from
information
it may obtain obtains and, according to that estimate,
so
made, assess the employing unit for
the contributions,
penalties,
and interest due. The commission shall have the power
unemployment agency may act under this subsection only after a
default
continues for 30 days and after the commission unemployment
agency has determined that the default of the employing unit is
willful.
(j) An assessment or penalty with respect to contributions
unpaid is not effective for any period before the 3 calendar years
preceding the date of the assessment.
(k) The rights respecting the collection of contributions and
the levy of interest and penalties and damages made available to
the
commission unemployment
agency by this section is are
additional
to other powers and rights vested in the commission in
pursuance
of the unemployment agency
under other provisions of this
act.
The commission is not precluded from exercising unemployment
agency
may exercise any of the collection
remedies provided for by
under this act even though an application for a redetermination or
an appeal is pending final disposition.
(l) A person recording a lien provided for in under this
section shall pay a fee of $2.00 for recording a lien and a fee of
$2.00 for recording a discharge of a lien.
Sec. 54. (a) A person who willfully violates or intentionally
fails to comply with any of the provisions of this act, or a
regulation
of the commission unemployment
agency promulgated under
the authority of this act for which a penalty is not otherwise
provided
by this act is punishable as provided in subdivision (i),
(ii), (iii), or
(iv) subject
to the following sanctions,
notwithstanding any other statute of this state or of the United
States:
(i) If the commission unemployment agency determines that an
amount has been obtained or withheld as a result of the intentional
failure
to comply with this act, the commission unemployment agency
may recover the amount obtained as a result of the intentional
failure to comply plus damages equal to 3 times that amount.
(ii) The commission unemployment agency may refer the matter to
the prosecuting attorney of the county in which the alleged
violation
occurred for prosecution. If the commission unemployment
agency has not made its own determination under subdivision (i), the
penalty
recovery sought by the prosecutor shall include the amount
described in subdivision (i) and shall also include 1 or more of the
following penalties:
(A) If the amount obtained or withheld from payment as a
result of the intentional failure to comply is less than
$25,000.00, then 1 of the following:
(I) Imprisonment for not more than 1 year.
(II) The performance of community service of not more than 1
year but not to exceed 2,080 hours.
(III) A combination of (I) and (II) that does not exceed 1
year.
(B) If the amount obtained or withheld from payment as a
result of the intentional failure to comply is $25,000.00 or more
but less than $100,000.00, then 1 of the following:
(I) Imprisonment for not more than 2 years.
(II) The performance of community service of not more than 2
years but not to exceed 4,160 hours.
(III) A combination of (I) and (II) that does not exceed 2
years.
(C) If the amount obtained or withheld from payment as a
result of the intentional failure to comply is more than
$100,000.00, then 1 of the following:
(I) Imprisonment for not more than 5 years.
(II) The performance of community service of not more than 5
years but not to exceed 10,400 hours.
(III) A combination of (I) and (II) that does not exceed 5
years.
(iii) If the commission unemployment agency determines that an
amount has been obtained or withheld as a result of a knowing
violation
of this act, the commission unemployment
agency may
recover the amount obtained as a result of the knowing violation
and may also recover damages equal to 3 times that amount.
(iv) The commission unemployment agency may refer a matter
under subdivision (iii) to the prosecuting attorney of the county in
which the alleged violation occurred for prosecution. If the
commission
unemployment agency has not made its own determination
under
subdivision (iii), the penalty recovery sought
by the
prosecutor shall include the amount described in subdivision (iii)
and shall also include 1 or more of the following penalties:
(A) If the amount obtained or withheld from payment as a
result of the knowing violation is $100,000.00 or less, then 1 of
the following:
(I) Imprisonment for not more than 1 year.
(II) The performance of community service of not more than 1
year but not to exceed 2,080 hours.
(III) A combination of (I) and (II) that does not exceed 1
year.
(B) If the amount obtained or withheld from payment as a
result of the knowing violation is more than $100,000.00, then 1 of
the following:
(I) Imprisonment for not more than 2 years.
(II) The performance of community service of not more than 2
years but not to exceed 4,160 hours.
(III) A combination of (I) and (II) that does not exceed 2
years.
(b) Any employing unit or an officer or agent of an employing
unit,
a claimant, an employee of the commission unemployment
agency, or any other person who makes a false statement or
representation knowing it to be false, or knowingly and willfully
with intent to defraud fails to disclose a material fact, to obtain
or increase a benefit or other payment under this act or under the
unemployment compensation law of any state or of the federal
government, either for himself or herself or any other person, to
prevent or reduce the payment of benefits to an individual entitled
thereto or to avoid becoming or remaining a subject employer, or to
avoid or reduce a contribution or other payment required from an
employing unit under this act or under the unemployment
compensation law of any state or of the federal government, as
applicable, is subject to administrative fines and is punishable as
follows, notwithstanding any other penalties imposed under any
other statute of this state or of the United States:
(i) If the amount obtained as a result of the knowing false
statement or representation or the knowing and willful failure to
disclose
a material fact is less than $500.00, the commission
unemployment agency may recover the amount obtained as a result of
the knowing false statement or representation or the knowing and
willful failure to disclose a material fact and may also recover
damages equal to 2 times that amount. For a second or subsequent
violation described in this subdivision, the unemployment agency
may recover damages equal to 4 times the amount obtained.
(ii) If the amount obtained as a result of the knowing false
statement or representation or the knowing and willful failure to
disclose
a material fact is $500.00 or more, the commission
unemployment agency shall attempt to recover the amount obtained as
a result of the knowing false statement or representation or the
knowing and willful failure to disclose a material fact and may
also
recover damages equal to 4 times that amount. The commission
unemployment agency may refer the matter to the prosecuting
attorney of the county in which the alleged violation occurred for
prosecution.
If the commission unemployment
agency has not made its
own
determination under this subdivision, the penalty recovery
sought by the prosecutor shall include the amount described in this
subdivision and shall also include 1 or more of the following
penalties if the amount obtained is $1,000.00 or more:
(A) If the amount obtained or withheld from payment as a
result of the knowing false statement or representation or the
knowing and willful failure to disclose a material fact is
$1,000.00 or more but less than $25,000.00, then 1 of the
following:
(I) Imprisonment for not more than 1 year.
(II) The performance of community service of not more than 1
year but not to exceed 2,080 hours.
(III) A combination of (I) and (II) that does not exceed 1
year.
(B) If the amount obtained or withheld from payment as a
result of the knowing false statement or representation or the
knowing and willful failure to disclose a material fact is
$25,000.00 or more, then 1 of the following:
(I) Imprisonment for not more than 2 years.
(II) The performance of community service of not more than 2
years but not to exceed 4,160 hours.
(III) A combination of (I) and (II) that does not exceed 2
years.
(C) If the knowing false statement or representation or the
knowing and willful failure to disclose a material fact made to
obtain or withhold an amount from payment does not result in a loss
to
the commission, then a penalty recovery
shall be sought equal to
3 times the amount that would have been obtained by the knowing
false statement or representation or the knowing and willful
failure to disclose a material fact, but not less than $1,000.00,
and 1 of the following:
(I) Imprisonment for not more than 2 years.
(II) The performance of community service of not more than 2
years but not to exceed 4,160 hours.
(III) A combination of (I) and (II) that does not exceed 2
years.
(c) (1) Any employing unit or an officer or agent of an
employing unit or any other person failing to submit, when due, any
contribution report, wage and employment report, or other reports
lawfully
prescribed and required by the commission unemployment
agency
shall be subject to the assessment of a
penalty an
administrative fine for each report not submitted within the time
prescribed
by the commission unemployment
agency, as follows: In
the case of contribution reports not received within 10 days after
the
end of the reporting month the penalty fine shall be 10% of the
contributions due on the reports but not less than $5.00 or more
than $25.00 for a report. However, if the tenth day falls on a
Saturday,
Sunday, legal holiday, or other commission unemployment
agency nonwork day, the 10-day period shall run until the end of
the next day which is not a Saturday, Sunday, legal holiday, or
other
commission unemployment
agency nonwork day. In the case of
all
other reports referred to in this subsection, the penalty fine
shall be $10.00 for a report.
(2) Notwithstanding subdivision (1), any employer or an
officer or agent of an employer or any other person failing to
submit, when due, any quarterly wage detail report required by
section
13(2) shall be is subject to a penalty an administrative
fine of $25.00 for each untimely report.
(3)
When If a report is filed after the prescribed time and it
is shown to the satisfaction of the commission that the failure to
submit
the report was due to reasonable cause, a penalty fine shall
not
be imposed. The assessment of a penalty fine as provided in
this
subsection shall constitute constitutes
a final determination
which
shall be final unless the employer
files with the commission
an application with the unemployment agency for a redetermination
of the assessment in accordance with section 32a.
(d)
If any commissioner, employee
, or agent of the commission
unemployment
agency or member of the appeal board
willfully makes a
disclosure
of discloses confidential information obtained from any
employing unit or individual in the administration of this act for
any purpose inconsistent with or contrary to the purposes of this
act,
or a person who having obtained obtains
a list of applicants
for
work , or of
claimants or recipients of benefits
, under this
act
shall use or permit the uses
or permits use of that list for a
political purpose or for a purpose inconsistent with or contrary to
the
purposes of this act, he or she is guilty of a misdemeanor and
upon
conviction shall be punished punishable
by imprisonment for
not
more than 90 days , or by
a fine of not more than $1,000.00, or
both.
Notwithstanding the preceding sentence, if any commissioner,
commission
unemployment agency employee, agent of the commission
unemployment agency, or member of the board of review knowingly,
intentionally, and for financial gain, makes an illegal disclosure
of confidential information obtained under section 13(2), he or she
is guilty of a felony, punishable by imprisonment for not more than
1 year and 1 day.
(e)
A person who, without proper authority from the commission
unemployment agency, represents himself or herself to be an
employee
of the commission to an employing unit or person
unemployment agency for the purpose of securing information
regarding the unemployment or employment record of an individual is
guilty
of a misdemeanor and upon conviction shall be punished
punishable
by imprisonment for not more than 90
days , or by
a fine
of not more than $1,000.00, or both.
(f) A person associated with a college, university, or public
agency of this state who makes use of any information obtained from
the
commission unemployment
agency in connection with a research
project of a public service nature, in a manner as to reveal the
identity of any individual or employing unit from or concerning
whom
the information was obtained by the commission unemployment
agency, or for any purpose other than use in connection with that
research
project, is guilty of a misdemeanor and upon conviction
shall
be punished punishable by imprisonment for not more than 90
days , or by a fine of not more than $1,000.00, or
both.
(g) As used in this section, "person" includes an individual,
copartnership, joint venture, corporation, receiver, or trustee in
bankruptcy.
(h)
This section shall apply applies
even if the amount
obtained or withheld from payment has been reported or reported and
paid by an individual involved in a violation of subsection (a) or
(b).
(i) If a determination is made that an individual has violated
this
section, the individual is subject to the penalty provisions
sanctions
of this section and, where if applicable,
the
requirements of section 62.
(j) Amounts recovered by the commission under subsection (a)
or
(b) shall be credited first to the
unemployment compensation
fund and thereafter amounts recovered that are in excess of the
amounts obtained or withheld as a result of the violation of
subsection
(a) and (b) shall be credited to the penalty and
interest
account of the contingent fund. Fines and penalties
Amounts recovered by the commission under subsections (c), (d),
(e), and (f) shall be credited to the penalty and interest account
of the contingent fund in accordance with section 10(6).
(k) Amounts recovered by the unemployment agency under
subsection (b) shall be credited as follows:
(i) Deductions from unemployment insurance benefits shall be
applied solely to the amount of the benefits liable to be repaid
under this section.
(ii) All other recoveries shall be applied first to
administrative sanctions and damages, then to interest, and then to
the amount liable to be repaid. The amounts applied to
administrative sanctions, damages, and interest shall be credited
to the special fraud control fund created in section 10.
(l) (k)
The revisions in the penalties in
subsections (a) and
(b) provided by the 1991 amendatory act that added this subsection
shall
apply to conduct that began before
April 1, 1992, but that
continued on or after April 1, 1992, and to conduct that began on
or after April 1, 1992.
Sec.
62. (a) If the commission unemployment
agency determines
that a person has obtained benefits to which that person is not
entitled,
the commission it may recover a sum equal to the amount
received
plus interest by 1 or more of the following methods: (1)
deduction
from benefits payable to the individual, (2) payment by
the
individual to the commission in cash, or (3) deduction from a
tax refund payable to the individual as provided under section 30a
of
Act No. 122 of the Public Acts of 1941, being section 205.30a of
the
Michigan Compiled Laws 1941
PA 122, MCL 205.30a. Deduction from
benefits
payable to the individual shall be is limited to not more
than 20% of each weekly benefit check due the claimant. The
commission
unemployment agency shall not recover improperly paid
benefits from an individual more than 3 years, or more than 6 years
in the case of a violation of section 54(a) or (b) or sections 54a
to 54c, after the date of receipt of the improperly paid benefits
unless :
(1) the unemployment agency
filed a civil action is filed
in
a court by the commission within the 3-year or 6-year period; ,
(2)
the individual made an intentional
false statement,
misrepresentation, or concealment of material information to obtain
the
benefits; , or (3) or the commission unemployment agency issued
a determination requiring restitution within the 3-year or 6-year
period.
Furthermore, except Except
in a case of an intentional
false statement, misrepresentation, or concealment of material
information,
the commission unemployment
agency may waive recovery
of an improperly paid benefit or interest if the payment was not
the fault of the individual and if repayment would be contrary to
equity and good conscience.
(b)
For benefit years beginning before the conversion date
prescribed
in section 75 October 1, 2000, if the commission
unemployment agency determines that a person has intentionally made
a false statement or misrepresentation or has concealed material
information to obtain benefits, whether or not the person obtains
benefits by or because of the intentional false statement,
misrepresentation, or concealment of material information, the
person shall, in addition to any other applicable interest and
penalties, have all of his or her uncharged credit weeks with
respect to the benefit year in which the act occurred canceled as
of
the date the commission unemployment
agency receives notice of,
or initiates investigation of, the possible false statement,
misrepresentation, or concealment of material information,
whichever date is earlier. Before receiving benefits in a benefit
year established within 2 years after cancellation of uncharged
credit weeks under this subsection, the individual, in addition to
making the restitution of benefits established under subsection
(a),
may be liable to the commission, by cash, deduction from
benefits,
or deduction from a tax refund, for
an additional amount
as
determined by the commission unemployment
agency under this act,
which may be paid by cash, deduction from benefits, or deduction
from a tax refund. Restitution resulting from the intentional false
statement, misrepresentation, or concealment of material
information is not subject to the 20% limitation provided in
subsection
(a). For benefit years beginning after the conversion
date
prescribed in section 75 on
or after October 1, 2000, if the
commission
unemployment agency determines that a person has
intentionally made a false statement or misrepresentation or has
concealed material information to obtain benefits, whether or not
the person obtains benefits by or because of the intentional false
statement, misrepresentation, or concealment of material
information, the person shall, in addition to any other applicable
interest and penalties, have his or her rights to benefits for the
benefit year in which the act occurred canceled as of the date the
commission
unemployment agency receives notice of, or initiates
investigation of, a possible false statement, misrepresentation, or
concealment of material information, whichever date is earlier, and
wages used to establish that benefit year shall not be used to
establish another benefit year. Before receiving benefits in a
benefit year established within 2 years after cancellation of
rights to benefits under this subsection, the individual, in
addition to making the restitution of benefits established under
subsection
(a), may be liable to the commission, by cash, deduction
from
benefits, or deduction from a tax refund, for an additional
amount
as otherwise determined by the commission unemployment
agency under this act, which may be paid by cash, deduction from
benefits, or deduction from a tax refund. Restitution resulting
from the intentional false statement, misrepresentation, or
concealment of material information is not subject to the 20%
limitation provided in subsection (a).
(c)
Any determination made by the commission unemployment
agency under this section is final unless an application for a
redetermination
is filed with the commission in accordance with
section 32a.
(d)
The commission unemployment
agency shall take the action
necessary to recover all benefits improperly obtained or paid under
this act, and to enforce all interest and penalties under
subsection (b).
(e) Interest recovered under this section shall be deposited
in the special fraud control fund created in section 10.
