Unemployment Insurance provides temporary income replacement to workers who become unemployed through no fault of their own. The benefits are paid from the Unemployment Trust Fund which is administered in Michigan by the Unemployment Insurance Agency (UIA) of the Department of Talent & Economic Development. The Unemployment Trust Fund is derived from state unemployment taxes or reimbursements paid by employers. Workers do not pay anything into the Unemployment Trust Fund.

Benefits are paid to workers who have had sufficient qualifying wages as required by the Michigan Employment Security Act. There are other reasons for disqualification, including workers who quit their jobs or are fired for misconduct. While drawing benefits, workers are required to be making every effort to find full-time, suitable work. Workers whose wages are reduced may be regarded as "underemployed" and entitled to some unemployment benefits, even though continuing to work at reduced wages.

Although most workers receive unemployment benefits properly, the Unemployment Insurance Agency randomly audits claims and conducts computer cross matches against the employer wage database to find claimants who have received benefits improperly while working. The Unemployment Insurance Agency aggressively pursues cases of improper and fraudulent claims, and the fraud penalties set by law can be as high as four times the amount of the improperly paid benefits.

Effective July 1, 2005, Michigan's SUTA dumping prevention legislation went into effect. This legislation is intended to penalize employers who are found to avoid the experience rating provisions of the Michigan Employment Security Act in order to pay taxes at reduced rates.

More information about claiming unemployment benefits in Michigan is available by choosing a topic of interest from among those listed on the Michigan Unemployment Insurance Agency website.