Unemployment COVID Overpayments Legislation Moves

Nov 14, 2025

by Liz Gullett

As MLC’s Communications and Social Media Manager, Liz Gullett keeps clients informed and up-to-date on the goings on in Lansing and the Capitol.

Legislation prohibiting the Unemployment Insurance Agency (UIA) from seeking to recover improperly paid benefits after three years was reported by the Senate Labor Committee this week.

Background:

    • During the COVID-19 pandemic, $2.7 billion in overpayments were sent to recipients.
    • Given the sharp increase in claims filed, the UIA was moving quickly to get funds to claimants, which led to errors.
    • Around 350,000 residents are being asked to repay those funds.
    • Recovery of the funds was put on hold for three years while a legal challenge worked its way through the courts.
    • This past fall, collections were allowed to restart.
    • The program is a joint Federal-State program, and the U.S. Department of Labor requires states to get back a portion of overpaid benefits.

Key Points:

    • Senate Bill 700 was introduced by Senator Darrin Camilleri (D-Brownstown).
    • It prohibits recovery of the funds after three years from when the funds were paid.
    • Requires the UIA to consider benefits paid between February 7, 2020, and September 5, 2021, to be considered an administrative or clerical error, and the agency must waive the recovery of those benefits.
    • The legislation provides an exemption for benefits paid due to fraud or identity fraud.

The bill was referred to the Senate Committee of the Whole for further consideration.

Michigan Legislative Consultants is a bipartisan lobbying firm based in Lansing, Michigan. Our team of lobbyists and procurement specialists provide a wide range of services for some of the most respected companies in America. For more on MLC, visit www.mlcmi.com or connect with us on LinkedIn and Twitter.

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