What to do? Being asked to pay back unemployment compensation.

July 8, 2014 - Categories: News

We have had a couple clients who received unemployment compensation told that they must pay back all or a portion of it, for various reasons. What do you do in that case?

First, you should receive a document telling you that you have the right to appeal the determination and to get a court hearing in front of an administrative law judge. If they didn't tell you how to appeal, then call the 800 number listed on the letter. Do this as quickly as possible.

Administrative Law Judge Hearing

After you timely request an ALJ hearing, you will receive a "Notice of Hearing" form from the "Michigan Administrative Hearing System" ("MAHS") (Form UIA 1801). The notice will inform you of the time, place, and type of hearing (i.e., in-person or telephone). The notice will also tell you the issues that will be addressed at the hearing. Make sure to read the back of the notice, because it contains rules and other information that will be important for the ALJ hearing. At the hearing, you will have the opportunity to offer witness testimony and other evidence in support of your position. The claimant will have an opportunity to cross examine your witnesses. You will have an opportunity to cross-examine the claimant after he/she testifies. ALJs have the right to ask witnesses questions, and they often do. Once the hearing is over, the ALJ issues a written decision on the matter.

Michigan Compensation Appellate Commission

If you are unhappy with the ALJ Decision, you may appeal it to the Michigan Compensation Appellate Commission ("MCAC") (formerly the Employment Security Board of Review). Three members of MCAC will review the evidence and then issue a new decision, either affirming, reversing, or modifying the ALJs decision. A written appeal must be received by the MCAC within 30 days of the mailing date of the ALJs decision. Late appeals will be accepted if an employer can establish "good cause" for the delay, but this is very difficult for employer's to establish.

Judicial Appeals

The MCAC's Decision can be appealed to the Circuit Court, the Court of Appeals, and finally to the Supreme Court. Trial court and appellate judges will then issues decisions affirming, denying, or modifying the decisions made below.

Also, see below about the types of "misconduct" that is allowed for you still receive unemployment compensation, and the type that is not. 

Discharge for Misconduct

If an individual is discharged for work-related misconduct, then he/she is disqualified from receiving unemployment benefits. What is considered "misconduct" for unemployment purposes is much different from what is considered misconduct in the normal working world. There are many things that constitute misconduct working world that do not rise to the level of "misconduct" for unemployment purposes. For unemployment purposes, misconduct is limited to intentional and substantial violations of rules or standards, or conduct showing a willful or wanton disregard of the employer's legitimate interests or of the employee's duties and obligations.

Below are some examples of conduct that does and does not constitute misconduct for unemployment purposes.

Examples of conduct that constitutes misconduct for unemployment purposes:

• Serious insubordination

• Theft

• Fighting

• Falsification of company records

• Alcohol or drug possession / consumption / intoxication on the job

• Single incident – May be enough to establish misconduct, if it shows an intentional or grossly negligent violation of an important rule or standard

• Multiple incidents – A series of different infractions may be enough to constitute misconduct, even if none of the infractions alone would be sufficient, provided the final incident shows an intentional disregard of the employer's interest

Examples of conduct that does not constitute misconduct for unemployment purposes

• Inefficiency

• Poor job performance

• Failure to meet job requirements due to inability or incapacity

• Inadvertence or ordinary negligence in isolated instances

• Good-faith errors in judgment or discretion

• Acts that have no connection with work

Note: There are many valid and legal reasons for discharge that do not qualify as misconduct for unemployment purposes. The fact that a claimant is granted unemployment benefits does not mean that his/her discharge was unlawful or improper. Remember – Even bad employees can receive unemployment benefits.

More questions? Need assistance at these hearings? Please contact us at: 855-0437-3704 for free legal advice and affordable legal help.