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SB 976

Employment security: other; updates to the employment security act; provide for. Amends secs. 11, 11a, 12, 13, 13a, 13b, 13c, 13d, 13e, 13f, 13g, 13i, 13k, 13l, 13m, 14, 15, 15a, 16, 17, 18, 19 & 19a of 1936 (Ex Sess) PA 1 (MCL 421.11 et seq.) & repeals sec. 12a of 1936 (Ex Sess) PA 1 (MCL 421.12a).

2023-2024 Regular Session Introduced by John Cherry

Expands and standardizes UIA disclosures to parties in workers' compensation disputes, aligning with federal rules and charging processing fees for requests.

VETOED BY GOVERNOR 1/17/2025
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WeVote Research Nonpartisan
Bill Summary · SB 976

SB 976 — Michigan Employment Security Act (UIA) — Summary (Vetoed 1/17/2025)

Status: VETOED by Governor (presented 1/7/2025; veto issued 1/17/2025).
Primary sponsor: Sen. John Cherry. Bill as enacted would have amended multiple sections of the Michigan Employment Security Act (1936 Ex Sess PA 1; MCL 421.11 et seq.) and repealed MCL 421.12a.

Purpose / Intent

The bill sought to modernize and clarify how the Unemployment Insurance Agency (UIA) handles and discloses claimant and employer information. It would align UIA disclosure practices with federal confidentiality rules (20 C.F.R. Part 603), expand who may obtain UIA records in certain worker’s compensation and benefit contexts, set cost‑recovery rules for information requests, and exempt certain UIA investigative methods from FOIA. The bill also repealed a statutory provision (section 12a) relating to entitlement of certain program participants to workers’ disability compensation benefits.

Key provisions

  • Federal-regulation compliance
    • Requires the UIA to follow 20 C.F.R. § 603.8 for any disclosure made under the statute.
  • Disclosure to parties in worker’s compensation matters
    • Authorizes disclosure of UIA information that “might affect” a worker’s disability compensation claim to an “interested party” who has obtained or is seeking a reduction of the worker’s compensation award (e.g., an employer or insurer).
    • Such recipients would receive only uncertified printouts of unemployment payments from the claimant’s date of injury to present.
    • Recipients must protect confidentiality and may be charged reasonable processing/copying fees (amounts determined by UIA).
  • Disclosure for benefit/experience-account matters
    • Clarifies that information affecting a claimant’s unemployment claim or an employer’s experience account is available to “interested parties” and their agents (with written authorization or in specified exceptions such as retained counsel or constituent services).
  • Court orders and subpoenas
    • Confirms UIA must produce information in response to court orders or officials with subpoena authority as provided under federal rules (20 C.F.R. § 603.7(b)).
  • FOIA exemption
    • Exempts from the Michigan Freedom of Information Act records describing UIA methods used to identify and investigate potentially fraudulent claims.
  • Cost accounting
    • Requires the UIA to calculate its costs to process disclosure requests and to charge requestors those costs (with narrow exceptions for nominal/incidental costs or reciprocal agreements).
  • Repeal of MCL 421.12a (sec. 12a)
    • Repeals a provision that previously linked entitlement to Workers’ Disability Compensation Act benefits for individuals participating in certain community work/training or work experience programs (removing that statutory entitlement).
  • Technical and cross‑references
    • Amends multiple sections (MCL 421.11, 421.11a, 421.12, 421.13, etc.) to implement the changes and clarify definitions (e.g., “interested party”).

Who would be affected

  • Claimants: potential additional disclosures of UIA records relevant to worker’s compensation or employer experience accounting; confidentiality protections modified for specific purposes.
  • Employers and workers’ compensation carriers: greater access to UIA records when pursuing reductions in workers’ compensation awards, subject to fee and confidentiality requirements.
  • UIA: new obligations to process disclosures under federal rules, calculate and charge costs, and manage confidentiality/FOIA exemptions; modest administrative workload increases.
  • Attorneys, courts, and authorized agents: clearer authority to obtain UIA information in specified circumstances.
  • Public/FOIA requesters: reduced access to records describing UIA fraud‑detection methods (FOIA-exempt).

Fiscal and policy impacts

  • Fiscal: Nonpartisan analyses estimated a minimal fiscal impact on the State. Any increased UIA administrative costs to handle disclosure requests would largely be recoverable through fees charged to requestors.
  • Policy: The bill balanced expanded access for parties with potential need for information in workers’ compensation and unemployment disputes against claimant privacy and public transparency (the FOIA exemption drew particular attention).

Legislative/timeline notes

  • Introduced: (Senate) July 30, 2024 (Sen. Cherry).
  • Passed Senate (with substitute S‑2): 12/05/2024.
  • Passed House (House substitute H‑1; immediate effect): 12/10/2024.
  • Presented to Governor: 1/7/2025.
  • Vetoed by Governor: 1/17/2025 (did not become law).
  • The measure was handled in concert (tie‑barred) with related UIA bills (SBs 962, 975, 981) and referenced changes elsewhere (e.g., SB 40, increasing maximum weeks of UI benefits).

Bottom line

SB 976 would have clarified and expanded authorized disclosures of UIA records (notably for parties challenging or seeking reductions to workers’ compensation awards), required UIA compliance with federal disclosure rules, instituted fees for information requests, and exempted UIA fraud‑detection methodology from FOIA — while repealing a provision linking certain program participation to workers’ disability compensation entitlement. Although legislators approved the bill, it was vetoed by the governor on January 17, 2025.

Compiled from official sources — confirm details with the bill’s official record.

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