This case involves interpretation of a provision of the Michigan
Employment Security Act, MCL 421.1 et seq. (MESA),
MCL 421.13m(2)(a)(i)(A). The issues are: (1) for what length of time
must a client employer have reported no employees or payroll to the
Unemployment Insurance Agency (UIA) (eight or more vs. 12 or more calendar
quarters) before its unemployment insurance tax rate will be the beneficial
“new employer tax rate” and (2) how does the statutory date of “January 1,
2014” factor into this equation? After
an administrative law judge, the Michigan Compensation Appellate Commission,
and the Macomb Circuit Court determined that the defendant was subject to the
shorter 8 or more calendar quarters and entitled to the beneficial “new
employer tax rate,” the UIA appealed the circuit court’s decision to the Court
of Appeals. In a published opinion, the
Court of Appeals reversed the circuit court and interpreted MCL
421.13m(2)(a)(i)(A) to require client employers to have reported no employees
or payroll for the longer period of 12 or more calendar quarters where, as
here, a professional employer organization (PEO) changes its method of reporting beginning January 1, 2014. The
Supreme Court has ordered oral argument on the application to address whether
the Court of Appeals correctly determined that the defendant could not satisfy
MCL 421.13m(2)(a)(i)(A) by reporting no employees
or no payroll for the eight quarters before January 1, 2014.