How Michigan Employers Could Be Affected by Changes to State Unemployment Law
April 25, 2025
Changes to Michigan’s unemployment insurance law for those who file for jobless benefits increase the maximum number of weeks of eligibility to 26, the maximum weekly benefit amount to $446, and the dependent allowance to $12.66.
The law went into effect on April 2, 2025, and it also specifies new maximum weekly benefit amounts on January 1 of 2026 and 2027. Beginning in 2028, any change in benefit amounts will be tied to the Consumer Price Index calculated by the federal Bureau of Labor Statistics. (Find a helpful FAQ at Michigan.gov/UIA.)
Employers should also know that the updates to the Michigan Employment Security (MES) Act will have a future impact on them, as well.
With tax rates set for 2025, employers won’t see changes this year. However, when they receive their 2026 tax rates in December the maximum chargeable benefits component (CBC) used to calculate contribution rates may be increased.
- Contributing employers charged the maximum tax rate of 10.3 percent in 2025 could see an estimated increase of 1.9 percent in 2026 taxes.
- Reimbursing employers, which make up about 2.2 percent of employers registered with UIA, would pay a higher amount in billings next year, reflecting increased weekly benefits paid on unemployment claims.
Michigan’s unemployment tax system is one of the most highly “experience rated” systems in the country. This generally means an employer’s tax is more closely based on the actual benefit charges to its account, and the size of payroll. To brush up on how benefits paid to employers could affect that experience rating, go to Michigan.gov/UIA for detailed explanations of the components that go into figure an employer’s tax rate.
The update to unemployment insurance law isn’t the only change employers are experiencing with unemployment. In December, the Michigan Unemployment Insurance Agency (UIA) announced a lower taxable wage base (TWB), which is the amount of employee wages that are taxed to support the unemployment insurance program. The TWB was reduced to $9,000, from $9,500, where it had been since 2021.