Michigan UIA resumes collections after Saunders settlement; agency offers waivers and expanded claimant support

LANSING — The Michigan Unemployment Insurance Agency has resumed sending bills for overpaid unemployment benefits after a court settlement in May 2025, UIA Director Palmer told the Michigan House Oversight Committee on state and local public assistance programs.

Palmer said the agency is now pursuing collections for balances established before, during and after the collections pause tied to the Saunders class-action litigation. "We are taking a considered approach in following our legal obligations as we return to overpayment collections," Palmer told the committee.

Why it matters: the pause in collections and the subsequent resumption have affected thousands of Michiganders and employers and have reduced the UI trust fund, the agency said. Palmer told the committee that pandemic-era claim volumes were large (about 3.5 million claimants and 5 million claims) and that the agency paid roughly $41.3 billion in benefits during that period. By contrast, he said, this year the agency has handled roughly 300,000 initial claims and paid about $740 million in benefits.

What an overpayment is: Palmer described overpayments as a standard feature of a system designed to balance speedy payments with program integrity. Overpayments can result from missing proof of employment or income, claimants returning to work while continuing to certify for…