Michigan Employer Advisor: May 2023

Greetings, Employers!

Spring is upon us, which makes the Michigan Unemployment Insurance Agency (UIA) very happy. Our agency had a big announcement recently that will make the employer community happy, too.

The UIA has contracted with Deloitte to design and install a new computer system that will be easier for Michigan’s employers and workers. This will replace our current MiDAS/MiWAM system and is expected it to be fully operational in 2025.

Deloitte is one of the largest global professional services networks that provides industry-leading audit, consulting, tax and advisory services to many of the world’s most admired brands, including nearly 90 percent of the Fortune 500 and more than 7,000 private companies. 

Based on our preliminary timeline, the employer / business services part of the system will launch first, followed by the worker / benefits side. Some of the things to look forward to in the new system:

• Ease of access for all users.
• Significant programming flexibility.
• New anti-fraud tools.
• Reports and dashboards.
• A human-centered design.

If you want to suggest an article or topic for a future edition of the Employer Advisor newsletter, or just want to tell us how much you enjoy reading it, please send a message to UIA-EmployerAdvisor@Michigan.gov. You can find past newsletters on the Employer Homepage at Michigan.gov/UIA.

 

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First Employer Seminar Slated for June

The UIA’s Employer Seminars are back for 2023 and it’s not too late to sign up for one this summer.

The first online seminar will be June 1 from 10 a.m. to noon. You’ll learn the basics about unemployment insurance, how to navigate your MiWAM account, employer liability and tax rates, and additional resources provided by the UIA. There will also be time for questions and answers from the audience.

Future online sessions are scheduled for July 13 and August 3. Register for either or all sessions by emailing UIA-EmployerAdvisor@Michigan.gov.

The seminars are sponsored by the UIA’s Office of Employer Ombudsman, which is committed to making your interactions with UIA positive while answering your questions about general unemployment and tax issues.

Be sure to check out the Employer Homepage at Michigan.gov/UIA for more ways that UIA can help Michigan’s businesses.

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Are You a Seasonal Employer? Here’s Everything That You Need to Know

A seasonal business only operates for a limited number of weeks or months each calendar year. Some examples of a seasonal business are a Christmas tree lot, lawn care service, fireworks stand, snow removal service, and ice cream stand.

Operating a seasonal business does not automatically make you a seasonal employer for unemployment insurance purposes, but requesting a seasonal designation could help keep your unemployment tax rate low by minimizing the amount of benefits paid out on claims. Michigan law allows an employer to apply for seasonal designation if the business operates for 26 weeks (182 days) or less within any 52-week period.

Whether you are a new employer or an existing employer, you must complete UIA Form 1155, Application for Designation as Seasonal Employer found on the UIA website or submit it through your MiWAM account. The request must be received at least 20 days before the beginning of the seasonal period. If your seasonal period changes, you must submit a new UIA Form 1155.

You Must Inform Employees:

Once the seasonal designation request is approved, employers are still required to file their Quarterly Wage/Tax Report even if the amount is zero for the seasonal period. An employer also must provide full disclosure to employees of the seasonal work designation. Do the following to ensure workers understand they are not entitled to unemployment benefits during the off season.

1. Post a copy of the application Form UIA 1155 for all workers to see.
2. Post a copy of UIA Form 1165, Determination of Seasonal Status -- which includes the Notice to Workers of Employer’s Designation as Seasonal -- in a place where workers will easily see it.
3. Inform workers in writing that the business is seasonal.
4. Give workers “reasonable assurance” of returning to work next season.
5. Only allow the workers to work during the normal seasonal work period.

This does not mean that a seasonal worker could not receive unemployment benefits. You are still required to report all employees on your Quarterly Wage/Tax Report. These are circumstances where the worker could receive benefits:

1. The employer did not do all the items listed above.
2. The worker had other employment.
3. The worker is laid off due to lack of work during the seasonal period.
4. The employer provided “reasonable assurance” of work, but a job was not offered in the new season.

What if I Lay Off an Employee?

If work slows down during the season but you intend to call the worker back, the Registration and Seeking Work waiver allows a worker to collect benefits during a short-term layoff period while not being required to register and seek work. The separation reason must be a lay off for lack of work and temporary work will be available within 45 days.

The request must be received before the layoff occurs (no later than the week before the layoff). The request and approval can be completed in minutes online using MiWAM. Login to your MIWAM account, click on the Account Services tab, then scroll down and select Request Seeking Work Waiver.

 

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Five Tips New Employers Should Know to Streamline Business Registration

We are excited to see Michigan growing and thriving with new businesses and jobs. Here is helpful information to assist with the process of registering with the UIA.

• Register your business online at Employer Registration. You become a liable employer and are required to file and pay unemployment taxes when you have hired Michigan employees that cumulatively gross $1,000 in wages or when you purchase/acquire a business.
• Write down the confirmation number for reference. If you need assistance or have questions about your application, the confirmation number will help in providing accurate instructions. If there are no problems with your application, an account number usually is assigned by the next business day.
• Check your mail and e-mail. You may receive correspondence from UIA that requires immediate attention. It is important that you review your correspondence and provide the requested information to ensure proper set-up and minimize penalties. Most correspondence requires action within 10 days of the date it was mailed to be considered on time and prevent future issues.
• Login to your MiWAM account. Once you receive the UI account number, a MiWAM account can be created. The MiWAM account is automatically created if the following criteria is met:
  • The Employer Account Number (EAN) is assigned through the online registration process.
  • The employer does not have an existing EAN with the same Federal Employer Identification Number (FEIN).
  • The e-mail associated with the online registration is not in use with the UIA.

If a MiWAM account was not created automatically, it can be set up manually at MiWAM For Employers. You will need your EAN, FEIN and ZIP code for the business' location.

You should have your own MiWAM account even if you have a third party processing your payroll. The account allows you to monitor activity, review correspondence, communicate with the UIA, and process requests online. If you have selected the “go green” alternative or have a third-party provider, you should check your account often because you will not receive anything through the U.S. mail.

• File and pay taxes. You are required to file a Quarterly Wage/Tax Report listing your employees and the wages earned for each quarter. The report must be filed starting in the first quarter you had employees and can only be filed online through your MiWAM account. If your registration application stated that you met the $1000 or $20,000 payroll requirement and this information was incorrect, do not file a zero-wage report. To avoid the EAN being closed, file a corrected Schedule A to adjust your liability date. Reports and payments not submitted in a timely manner will result in a penalty and interest being applied to the account.

The UIA is here to help you with this process. If you have questions or need help, contact the Tax Status unit through the Office of Employer Ombudsman: 1-855-484-2636, option #5.

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Sorting Out the Nuances of Employing a Family Member, Their Benefits Status

Business owners who employ a family member should be aware of rules governing qualification for unemployment benefits.

Family employment is considered by the UIA to be any services performed by a parent, spouse, or child of the business owners.

This information previously was needed for unemployment claims but the benefits limitation was removed more than 10 years ago. If you employ family members, do not check the family box on the Quarterly Wage/Tax Report to ensure smooth processing of unemployment claims. This box is not meant for family relatives.

Services performed by a business owner’s son, daughter, or spouse, and services performed by a child less than 18 years of age who is employed by a parent are excluded for unemployment insurance purposes and should not be reported on the Quarterly Wage/Tax Report. This applies to businesses that are sole proprietors, partnerships, Limited Liability Companies (LLC) and Limited Liability Partnerships (LLP).

For additional information on the tax treatment of members of these types of businesses, refer to Fact Sheet 176.

For more information, contact UIA’s Tax Status unit through the Office of Employer Ombudsman at 1-855-484-2636, option #5.