Under the Michigan Employment Security Act, an employee of an educational institution (typically a school district) is not eligible for unemployment during the summer months, provided that the employee is given reasonable assurance of returning to their position in the fall. MCL 421.27(i). Until recently, however, individuals employed at certain types of schools (such as preschools) or employed by a contractor who operates the school (such as a charter school management company) were not considered educational employees and thus were not subject to the school denial period. This meant that their employer was required to pay them unemployment for the summer months, even if they had reasonable assurance of returning to work in the fall.
The Michigan legislature recently amended this act to provide that employees of a contractor are subject to the school denial period. MCL 421.27(n). As a result, educational employees are treated the same, regardless of whether they are directly employed by a school district, a management company, a private agency, or through some other contract between their employer and an “educational institution” or an “educational service agency.”
This change in the law has greatly reduced unemployment costs for employers whose employees are now subject to the school denial period.
