The Michigan Unemployment Agency (UA) will introduce a new "wage record system" on Oct. 1, which is expected to save the state recordkeeping costs while having a nominal effect on the income of jobless workers and the cost to employers.

"The new system is basically benefit-neutral," said Dave Plawecki, deputy director of the Unemployment Agency, during a presentation to the Michigan Building Trades Council's annual convention. "The system is mandated by the federal government, and Michigan is the last state to implement it. It collects about the same in taxes. Some jobless workers will get a little bit more, some will get a little less."

Currently, the agency must send requests for wage information to employers every time one of their employees files an unemployment claim. The agency will scrap the existing system, and replace it with a program of using quarterly wage information submitted by employers to establish the amount of unemployment benefits jobless workers may receive, if they are otherwise eligible.

Advantage to employers: they will no longer have to complete up to one million UA forms annually, requesting weekly wage information. This will save employers and the UA countless hours in processing time as well as mailing costs.

Advantage to laid-off workers: They will know immediately upon filing their claims how much they may get in unemployment benefits, rather than wait up to 14 days. In addition, the Unemployment Agency says Wage record can help identify and resolve problems with wage information before the first payment is made, and thereby reduce errors and fraud in the UA system. This will result in millions of dollars in annual savings to the state's UA trust fund.

Advantage to the state: A savings of about $3 million to $5 million a year. And by converting to wage record now, the federal government will provide most of the funding to cover Michigan's conversion costs.

The changes were made with input from a committee comprised of business, labor and Unemployment Agency reps.

The wage record base period is the first four of the last five completed calendar quarters. If a person is unable to qualify on that basis, then the last four completed quarters are considered. Previously, the base period was the 52 weeks preceding the filing for benefits, and jobless workers qualified on the basis of their base period employment and earnings.

Wage record calculates the weekly benefit amount at 4.1% of wages paid in the high quarter plus $6 per dependent (up to five dependents are allowed). . In the past, benefits were based on 67% of after-tax earnings. The current maximum benefit of $300 per week will not change.