HOUSE BILL NO. 4504

A bill to amend 1936 (Ex Sess) PA 1, entitled

"Michigan employment security act,"

by amending section 15 (MCL 421.15), as amended by 2017 PA 229.

the people of the state of michigan enact:

Sec. 15. (a) Contributions unpaid on the date on which they are due and payable, as prescribed by the unemployment agency, and unpaid restitution of benefit overpayments, except as otherwise provided under this subsection, bear interest at the rate of 1% per month, computed on a 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 unemployment agency. The interest on unpaid contributions and on unpaid restitution of benefit overpayments, exclusive of penalties, must not exceed 50% of the amount of contributions due at due date or 50% of the amount of restitution owing. Nothing in this act authorizes the assessment or collection of interest on a penalty imposed under this act. Interest collected under this section must be paid into the contingent fund. Penalties collected under this section must be credited pursuant to section 54(k). With regard to contribution payments, the unemployment agency 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 unemployment agency, or fraud. All of the following apply to interest on unpaid restitution of benefit overpayments:

(1) Except as provided in subdivisions (2) and (3), interest begins accruing 1 year after the date the unemployment agency's determination or redetermination or an administrative law judge's, the Michigan compensation appellate commission's, or a court's order that a claimant owes restitution is final.

(2) The unemployment agency shall not assess interest for improperly paid benefits that were the result of an administrative or clerical error made by the unemployment agency. Interest assessed for improperly paid benefits that is later determined to have been the result of an administrative or clerical error made by the unemployment agency must be waived, and any payment made by a claimant for such interest must be refunded.

(3) If the unemployment agency determines or redetermines or an administrative law judge, the Michigan compensation appellate commission, or a court orders that a claimant made an intentional false statement, misrepresentation, or concealed material information to obtain or increase benefits, interest begins accruing on the date the unemployment agency's determination or redetermination or the order is final.

(b) The unemployment agency may make assessments against an employer, claimant, employee of the unemployment agency, or third party who fails to pay contributions, restitution of benefit overpayments, reimbursement payments in lieu of contributions, penalties, forfeitures, or interest as required by this act. The unemployment agency shall immediately notify the employer, claimant, employee of the unemployment agency, or third party of the assessment in writing by first-class mail. The unemployment agency shall not make an assessment against a claimant, an employee of the unemployment agency, or a third party under this subsection unless the assessment is for a penalty for a violation of section 54(a) or (b) or sections 54a to 54c. An assessment made under this subsection is a final determination unless the employer, claimant, employee of the unemployment agency, or third party files with the unemployment agency an application for a redetermination of the assessment pursuant to section 32a. A review by the unemployment agency or an appeal to an administrative law judge or the Michigan compensation appellate commission on the assessment does not reopen a question concerning an employer's liability for contributions or reimbursement payments in lieu of contributions or a claimant's entitlement to benefits, unless the claimant or 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). If an assessment is not paid within 15 days after it becomes final, the unemployment agency may issue a warrant under its official seal for the collection of the assessed amount. The unemployment agency, through its authorized employees and under a warrant issued, may place a lien on any bank account of a claimant or employer and may levy upon and sell the property of an employer that is used in connection with the employer's business, or that is subject to a notice to withhold, found within this 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 is not exempt from levy under the warrant. Wages subject to a notice to withhold are exempt to the extent the wages are exempt from garnishment under the laws of this state. The warrant must be returned to the unemployment agency together with the money collected under the warrant within the time specified in the warrant which must not be less than 20 or more than 90 days after the date of the warrant. The unemployment agency shall proceed upon the warrant as prescribed by law in respect to executions issued against property upon judgments by a court of record. This state, through the unemployment agency or some other officer or agent designated by it, may bid for and purchase property sold under this subsection. If an employer, claimant, employee of the unemployment agency, or third party is delinquent in the payment of a contribution, reimbursement payment in lieu of contribution, penalty, forfeiture, or interest provided for in this act, the unemployment agency may give notice of the amount of the delinquency served either personally or by mail, to a person or legal entity, including this 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 unemployment agency, or third party, or who owes a debt to the employer, claimant, employee of the unemployment agency, or third party at the time of the receipt of the notice. A person or legal entity that is notified shall not transfer or dispose of the credit, other intangible property, or debt without retaining an amount sufficient to pay the amount specified in the notice unless the unemployment agency consents to a transfer or d