Saunders v. Michigan UIA Settlement: Payouts, Deadlines, Collection Changes

The Saunders v. Michigan UIA settlement is a $55 million class action resolution over money the Michigan Unemployment Insurance Agency collected from pandemic-era claimants before their protests or appeals were resolved. The Michigan Court of Claims granted final approval on May 13, 2025, and checks for valid, timely claims were mailed on August 1, 2025.¹

Who the Settlement Covers

The class includes people from whom the UIA collected money on an unemployment claim filed between March 1, 2020, and April 25, 2024, under specific circumstances the lawsuit called “Improper Collections.” Those circumstances were narrow: the agency took money while a protest or appeal was still pending, after a claimant tried to appeal but could not access the system, or after a protest or appeal was never processed or was deleted.²

Simply receiving an overpayment notice from the UIA does not put you in this class. The case is about collections made before the agency finished deciding whether the money was actually owed. The UIA did not admit any liability or wrongdoing under the settlement.²

How Much Class Members Received

The $55 million fund is non-reversionary, so nothing goes back to the state. After attorneys’ fees of up to one-third (roughly $18.3 million), litigation costs, administrative expenses, and $25,000 service awards for each named plaintiff, the remainder — called the Net Common Fund — is split pro rata among eligible claimants.²

Each eligible claimant received one “award point” for every dollar the agency had collected and not already refunded. Claimants who submitted documentation of additional hardship or qualifying factors could apply for an Enhanced Award, which increased their share.¹ One early estimate put the average payout near $1,400 based on roughly 23,000 affected individuals, but actual amounts depended on how much the UIA had taken from a given person.³

Payment Dates and What Happens If You Missed the Deadline

Payments on valid, timely claims were mailed August 1, 2025.¹ The original claim deadline was November 4, 2024, with late submissions accepted until December 20, 2024.⁴

If you missed those deadlines, a late claim is still possible but not guaranteed. The settlement set up a Reserve Fund for late submissions, and any payout requires court authorization and depends on what remains in the fund. The settlement administrator expects final decisions on late claims around fall 2026. A separate Relief Fund administered by the State Bar Foundation was also created under the final order.¹

What the Final Order Changed for UIA Collections

Early in the case, in June 2022, the court had issued an injunction blocking the UIA from billing or accepting payments on pandemic-era federal unemployment claims while the litigation moved forward. The May 13, 2025 final order dissolved that injunction. The agency is now authorized to resume collection activity on overpayments that fall outside the scope of the settlement.⁵

That matters because the Saunders class is a small slice of a much larger population. The UIA overpaid an estimated $2.7 billion to roughly 350,000 Michigan residents during the pandemic, often because of administrative errors rather than any fault by the claimant.⁶ If you received an overpayment notice but were not part of the Saunders class, the settlement does not cancel what the UIA says you owe.

Pending Legislation on Broader Overpayments

Michigan lawmakers have moved separately to address the wider overpayment problem. Senate Bill 700, sponsored by Senator Darrin Camilleri, would prohibit the UIA from collecting non-fraudulent overpayments more than three years after the benefits were paid, applied retroactively to claims filed on or after February 1, 2020. The bill would also let claimants apply for a repayment waiver.⁶ The Michigan Senate passed SB 700 unanimously on December 9, 2025.⁷ As of mid-2026, the bill sits in the Michigan House Committee on Appropriations with no recorded vote.⁸

Companion legislation in the House, Bills 5393 and 5394 introduced in late December 2025 by Representatives Mai Xiong and Joey Andrews, takes a similar approach of shielding workers from collection where administrative errors were not their fault.⁹ Both were referred to House Appropriations in December 2025 and have not moved.¹⁰

Even if the legislature acts, waiving these debts is not entirely a state decision. Much of the overpaid money came from federally funded pandemic programs, and the Michigan Chamber of Commerce has noted that the state must secure U.S. Department of Labor approval before waiving those debts. If the DOL finds a waiver impermissible, the state or its employer-funded Unemployment Trust Fund could be on the hook to repay the federal government.⁷ The DOL has issued guidance encouraging states to waive recovery of non-fraud pandemic overpayments and has described scenarios where blanket waivers are permitted, but each state still has to go through an approval process.¹¹

1
BW Class Actions. Saunders v. State of Michigan UIA Settlement
2
Michigan Attorney General. Saunders Notice of Settlement
3
WDET. Final Hearing Pushed in Pandemic-Era Class Action Against UIA
4
Michigan LEO. New Date Set for Final Hearing in Pandemic-Era Class Action Against UIA
5
Michigan House of Representatives. Committee Testimony on UIA Overpayments
6
Michigan Legislature. Senate Fiscal Agency Analysis of SB 700
7
Michigan Chamber of Commerce. Senate Passes Bill to Waive the Collection of Improper Unemployment Benefits With Changes
8
Michigan Legislature. SB 700 Bill Status
9
Michigan House Democrats. Xiong, Andrews Introduce Bills to Protect Michigan Workers From UIA Overpayment Burden
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Michigan Legislature. HB 5393 Bill Status
11
U.S. Department of Labor. U.S. Department of Labor Issues Guidance on Pandemic Unemployment Overpayments