Tag: unemployment

Five Stories that Matter in Michigan This Week – August 26, 2022

  1. Michigan Sees Unemployment Decrease as Jobs Increase

According to recent data released by the Michigan Department of Technology, Management, and Budget, the unemployment rate in the state dropped from 6.2% to 4.2% over a twelve-month period. Michigan also saw a bump in jobs last month, with 3,000 in July.

Why it Matters: Officials point to the increase in job growth and lower unemployment rates as a reflection of the hard work that the government, people, and businesses have put into the economy to shift to a more positive outlook.

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  1. Michigan to Deploy $72M in Federally Funded Small Business Loans and Investments

$72 million of funding Michigan received from the federal Small Business Credit Initiative 2.0 is being deployed for loans to small businesses through Michigan Economic Development Corporation capital and lending programs. The MEDC will also invest  up to $75 million in early-stage, technology-based businesses in Michigan through the Small Business Venture Capital Program.

Why it Matters: Michigan’s venture capital and startup ecosystem continues to grow. The amount of venture capital invested in Michigan reached an all-time high in 2021. According to the Michigan Venture Capital Association’s 2022 Impact Report, a record $1.38 billion into 155 companies last year through 161 deals.

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  1. MDOT Seeks to Install Automated Cameras in Work Zones

Michigan HB 5750 would allow the Michigan Department of Transportation (MDOT) to install automated cameras in work zones to capture speeders. While the bill sits on the House floor, the road construction industry is getting behind the bill.

Why it Matters: If this bill passes, drivers will need to be aware of the resulting penalties for exceeding the posted speed by 10 mph or greater, which would range from a written warning to a $300 fine.

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  1. Gas Prices Continue to Decrease Since Record June 2022 Highs

The American Automobile Association (AAA) reports that the average Michigander is paying just under $4 for a gallon of gas, down from the record high average of $5.22 in June.

Why it Matters:  While gas prices continue to decrease, Michiganders are still paying more per gallon when compared to 2021. Citizens and officials alike will look to continue seeing the downward trend. Spending less at the pump can increase spending in other areas of the economy.

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  1. U of M Study Finds that Wind and Solar Industries Could Fully Replace Jobs Lost at U.S. Coal-Fired Power Plants

A recent University of Michigan study found that the wind and solar industries could fully replace the number of lost jobs at U.S. coal-fired power plants that are expected to close to meet emission-reduction targets.

Why it Matters: The recently enacted Inflation Reduction Act includes substantial funding for wind and solar energy tax incentives. The bill is intended to spur growth and investment in clean energy projects across the country. Michigan has recently seen growth in jobs in the energy sector. In fact, the state ranked first in the nation for energy job growth in a recent U.S. Department of Energy report. Michigan added more than 35,000 energy-sector jobs from 2020 to 2021.

Related Practice Groups and Professionals

Business & Tax| Ed Castellani

Labor & Employment | Aaron Davis

Energy, Utilities & Telecommunication | Michael Ashton

Insurance Defense | Emily Vanderlaan

Five Stories that Matter in Michigan This Week – June 10, 2022

Five Stories that Matter in Michigan This Week – June 10, 2022; Legal, Legislative, and Regulatory Insights

  1. Wayne County Announces $54 Million Fund for Small Businesses

A new $54 million fund to support small businesses, called the Wayne County Small Business Hub, was announced at last week’s Detroit Regional Chamber’s Mackinac Policy Conference (“Mackinac Conference”). It will provide support to new and existing businesses, with a specific focus on minority- or women-owned businesses, and micro businesses with 10 or fewer employees with a focus on technical assistance.

Why it Matters: Small businesses are often the first to be hit when the economy slows, and with credit markets tightening there are likely to be fewer sources of liquidity for small business owners to tap. This new fund, a collaboration between the Wayne County Executive’s Office and New Economy Initiative, will provide needed resources for historically disadvantaged businesses.

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  1. Ford and Pfizer to Make Significant Investments in Michigan

Also at the Mackinac Conference, Ford Motor Company and Pfizer announced significant investments in Michigan. Ford reportedly will spend $2 billion across the company’s Michigan plants, and intends to create more than 3,000 jobs. Pfizer will make a $120 million investment at its Kalamazoo facility.

Why it Matters: With a great deal of economic doom and gloom in the headlines, these announcements are bright spots showing that large companies are still making investments in their businesses—and in Michigan, in particular.

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  1. Concerns Expressed About Losing Another EV Investment in Michigan

But it’s not all good news on the economic front in Michigan. At the Mackinac Conference, John Rakolta Jr., chairman of Walbridge, pointed out that Michigan is missing out on major opportunities in the electric vehicle industry. For example, Stellantis announced last week that it was bypassing Michigan and locating its new electric vehicle battery manufacturing plant in Kokomo, Indiana.

Why it Matters: According to a study by Fortune Business Insights, the global electric vehicle market is expected to grow from approximately $287 billion in 2021, to $1.3 trillion by 2028. To take advantage of this opportunity, Michigan must make itself attractive to companies in the electric vehicle market. As Rakolta points out, this involves more than designing tax incentives. It requires a more comprehensive approach to utilities, zoning and other important business, financial,  legal and regulatory issues.

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  1. Unemployment Claimants Get to Keep Pandemic Overpayments

Michigan sought to claw back Pandemic Unemployment Assistance benefits paid to many Michigan residents who were accused of misreporting their income. Michigan argued that claimants were liable because they entered their gross pay from prior years to determine their weekly benefit amount when they should have entered their net pay. Michigan reversed course and announced that it would no longer seek to claw back the funds after media reports revealed that at least some claimants were asked during the application process to provide total pay—not net pay—which resulted in confusion and overpayments.

Why it Matters: This announcement surely came as a relief to many Michigan residents who were embroiled in disputes with the Michigan Unemployment Insurance Agency. More broadly, this situation demonstrates the importance of using precise, accurate language in contracts and other important documents. The alternative is to invite confusion, dispute and litigation.

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  1. Michigan Cannabis Company Files for Chapter 11 Bankruptcy

A Kalamazoo cannabis company, Master Equity Group,  recently filed for  Chapter 11 bankruptcy in the U.S. Bankruptcy Court in the Western District of Michigan.

Why it Matters: This case will be closely watched by the cannabis industry, as well as by corporate restructuring professionals. Bankruptcy courts have historically prevented cannabis companies from filing for protection under the United States Bankruptcy Code because, while marijuana is legal in Michigan, it remains illegal under the federal Controlled Substances Act. And because bankruptcy courts are federal courts, similar attempts by cannabis companies to file for bankruptcy protection have been disallowed.

Related Practice Groups and Professionals

Administrative & Regulatory | Michael Ashton
Business & Tax  | Mark Kellogg
Labor, Employment & Civil Rights | Aaron Davis
Cannabis | Klint Kesto

Unemployment Compensation Benefits Extended to 26 Weeks

On October 20, 2020, Michigan Senate Bill 886 was signed into law by Governor Gretchen Whitmer. The bill extends the expansion of unemployment benefits for Michigan workers from 20 weeks to 26 weeks. Extended Benefits are now available for claims established on or before December 31, 2020, on which date the extended benefits provision expires.

The Michigan legislature passed the bipartisan legislation, which is now Public Act No. 229, following the Michigan Supreme Court’s ruling on October 2, 2020, that the governor lacked the authority, after April 30, 2020, to issue or renew COVID-19-related executive orders under the Emergency Powers of Governor Act of 1945. The new law, with certain exceptions noted below, largely reflects the now invalidated Executive Order 2020-76, which provided for temporary expansions in unemployment eligibility.

Public Act No. 229 provides that:

  • The maximum unemployment benefit period is extended from 20 weeks to 26 weeks;
  • Certain eligibility requirements for an individual to receive benefits would not apply if COVID-19 prevents the individual from meeting the requirements;
  • Benefits are to be charged to the employer’s “non-chargeable” account when a worker is laid off due to COVID-19, meaning that the employer’s experience rating is not affected by the cost of extended benefits;
  • Workers may receive benefits during time off work due to a COVID-19-related cause.

Public Act No. 229, in contrast to Executive Order 2020-76, does not waive the requirement that an unemployed worker must be “seeking work” to be eligible for benefits.  Thus, except in certain circumstances, claimants will need to prove they are actively searching for a job to receive benefits. The requirement that a claimant seek work to receive benefits can be waived if either (i) the employer notifies the Unemployment Insurance Agency (“UIA”) that the layoff is temporary and that work is expected to be available in a declared number of days, not to exceed 45 days, following the last day the laid-off individual worked, or (ii) the UIA finds that suitable work is unavailable both in the locality where the individual resides and in those localities in which the individual has earned wages during or after the base period.

Another way in which Public Act No. 229 deviates from Executive Order 2020-76 is that it requires the UIA to review the claimant’s job history for the 18-month period preceding the claim filing date.  Any disqualification identified during that period would prevent the extension of benefits.  Executive Order 2020-76 had waived that requirement, requiring the UIA only to only consider a claimant’s most recent job. In a statement issued in conjunction with signing the bill into law, the governor’s office called the 18-month look-back period “a waste of resources because employers are not being directly charged for benefits paid at this time.”

If you have any questions about how this new law affects your business, please contact your Fraser Trebilcock attorney. 

This alert serves as a general summary, and does not constitute legal guidance. All statements made in this article should be verified by counsel retained specifically for that purpose. Please contact us with any specific questions.

We have created a response team to the rapidly changing COVID-19 situation and the law and guidance that follows, so we will continue to post any new developments. You can view our COVID-19 Response Page and additional resources by following the link here. In the meantime, if you have any questions, please contact your Fraser Trebilcock attorney.

Fraser Trebilcock Shareholder Dave Houston has over 40 years of experience representing employers in planning, counseling, and litigating virtually all employment claims and disputes including labor relations (NLRB and MERC), wage and overtime, and employment discrimination, and negotiation of union contracts. He has authored numerous publications regarding employment issues. You can reach him at 517.377.0855 or dhouston@fraserlawfirm.com.