Michigan workers who were wrongly accused of unemployment fraud have until April 5 to register for a $20 million class action settlement with the state, with a deadline of April 14 to submit a claim form. Eligible workers who received a determination or redetermination of “intentional misrepresentation” between October 1, 2013, and August 31, 2015, through the agency’s auto-adjudication process and experienced collection efforts on or after March 9, 2015, may be entitled to recoup their losses and receive compensation for hardships related to the wrongful collection.
The settlement was reached last year and approved by the Michigan Court of Claims in January following false fraud accusations against 40,000 people between 2013 and 2015. The Michigan unemployment system flagged thousands of accounts, prompting the agency to garnish wages and seize tax refunds. In 2019, more than $20 million in refunds were issued to those affected. However, workers still sued the state, alleging that the agency violated their due process rights with unlawful collection efforts.
Michigan Attorney General Dana Nessel encouraged eligible Michigan residents to join the class settlement, which cannot undo the hardships faced by those affected, but provides long-overdue relief. Payments are estimated to be distributed between August 19 and September 8. The Michigan unemployment agency is currently facing two other lawsuits alleging due process violations, including one in January 2022, which claims the state unlawfully demanded pandemic benefits back and collected on overpayments caused by agency error, and another in August 2022, which alleges the unemployment agency froze payments for thousands of workers during the pandemic without providing an appeals process.