Michigan Employer Advisor: August 2024

Number of Employer Audits Has Increased Following the Pandemic

The COVID-19 worldwide pandemic presented an unparalleled sequence of events that provided challenges for the Field Audit Program at the Michigan Unemployment Insurance Agency. Post-pandemic, however, the program’s more than 25 auditors has bounced back.

The UIA’s Field Audit Section serves as gatekeepers of the UI tax system by conducting audits, investigations, and educating employers about how to comply with the law.

Many auditors, such as Kim Barker, have years of experience and are certified in auditing and investigations through the National Association of State Workforce Agencies (NASWA). Auditors provide expert knowledge and demonstrate a professional approach when assisting employers.

Audits are performed either in-person but can also be completed electronically. The online capability was developed in 2019 and used exclusively during the pandemic to meet U.S. Department of Labor audit program requirements. Relying on electronic audits drastically reduced the number of audits UIA completed.

Since the pandemic, however, the number of field audits has tripled (as shown in the chart above).

When an employer receives a Notification of Audit Letter, it will state whether the upcoming audit will be conducted in person or electronically. Either way, the same laws, rules and procedures apply. 

An employer audit serves three main purposes: Ensure wages are properly reported, determine misclassification and look for hidden or unreported wages, and educate the employer community to comply with the law.

For more information about the audit process, see the May edition of the Employer Advisor.

How an Employer Classifies a Worker is Important, Fair for Everyone

When a worker performing a duty for an employer is misclassified, it creates an unfair advantage for a business.

Confirming job classifications is one of the main goals of employer audits conducted by the Field Audit Program at the Michigan Unemployment Insurance Agency (UIA). The audits confirm a worker’s status as either a paid employee or an independent contractor.

Historically, there are certain categories of employers that are observed to have a higher percentage of incorrectly classified workers. In Michigan, these attributes are based upon industry codes, the number of employees, the years the employer has been in business, and the percentage of unpaid unemployment insurance payments over three years.

Here are the Top Five industry codes for employers in Michigan from 2020-23 that have traditionally had misclassified workers:

UIA is working hard to address worker misclassification in Michigan. The Field Audit Section aims to identify key factors of worker misclassification and improperly reported wages to help employers comply with unemployment laws, rules, and regulations.

Video Explains How to Update Contact Information in MiWAM

To prepare for a smooth transition to MiUI -- the UIA's modern, user-friendly computer system -- employers should make sure their contact information is up to date in their Michigan Web Account Manager (MiWAM) account. 

Employers who use a third-party administrator should make sure the correct TPA is designated on the business' MiWAM account. Also, activate inactive MiWAM accounts or create one if you don’t have one.

UIA anticipates using MiWAM contact information to send updates about its new computer system. The correct contact information and TPA relationship will ensure everyone gets timely information.

Click on the animated video below for step-by-step directions on how to update business and email addresses.

Be sure to understand and follow these steps so as not to miss important MiUI communications leading up to the new system rollout:

3 Steps to Update a Business Address

1. Have the master user log in to MiWAM.
2. On the homepage, click on Names and Addresses to view or change the physical and/or legal address.
3. A confirmation number will be sent to the MiWAM account once the address update has been completed.

4 Steps to Update an Email Address

1. From the MiWAM homepage, click on Settings.
2. Then, click on Edit.
3. Update the email address and any other profile details, if necessary.
4. Click Save.

Michigan Employers Can Find Talent by Participating in MiTalent.org

Employers can elevate their recruiting efforts with a free employer account on the Pure Michigan Talent Connect website.

The account provides access to thousands of Michigan job seekers and the tools to promote available opportunities. When a worker files for unemployment, they must create a job seeker profile with Pure Michigan Talent Connect.

MiTalent.org also allows employers to promote career events and provides support for hosting virtual job fairs – all at no cost. With an account, employers will also gain access to a variety of resources available through the Michigan Department of Labor & Economic Opportunity (LEO), which includes the Unemployment Insurance Agency (UIA).

Create your free employer account today at MiTalent.org.