Michigan's system of workers' compensation is compulsory, meaning that employers are required to provide workers' compensation insurance to their employees. Workers' compensation insurance may be provided through private insurance carriers or self-insurance. Waivers may be permitted to exclude certain employees from coverage, including corporate officers and children working on family farms.
Exemptions from coverage may apply to certain employees, including some agricultural workers and many domestic employees.
Medical Benefits are provided to employees entitled to workers' compensation benefits, including coverage for necessary medical care.
The employer may choose the treating physician for an employee's first twenty-eight days of care. After that initial period the employee can choose a different treating physician. The employee may subsequently seek the consent of the employer or workers' compensation insurer for a change of doctor. Second opinions are permitted as long as they are reasonable and necessary.
Indemnity benefits are payable to injured workers to help make up for lost income. There is a waiting period of 7 days before a worker is eligible for indemnity benefits, but if the worker's disability lasts more than 14 days indemnity benefits become retroactive to the date of the injury.
Benefits available to injured workers include the following:
Temporary Total Disability (TTD)
Temporary total disability (TTD) benefits are paid to workers who are unable to work due to injury, but who are expected to make full or partial recovery such that they may return to work. Benefits are based upon 80% of the employee's post-tax net wages, subject to a cap, and continue for the duration of the temporary disability. Offsets may apply based upon the receipt of other benefits including Social Security or other retirement benefits, or disability insurance benefits from an employer-funded policy.
Permanent Total Disability (PTD)
When a worker is not expected to recover from a total disability caused by a work-related injury, and as a result suffers a total loss of earning capacity, the worker becomes eligible for permanent total disability (PTD) benefits. In Michigan PTD benefits are calculated based upon 80% of the worker's after-tax net weekly wages, subject to a cap, and are adjusted each year when the cap is adjusted. PTD benefits may continue for up to 800 weeks, with a possible conclusive payment at the end of that time. Offsets may apply based upon the receipt of other benefits including Social Security or other retirement benefits, or disability insurance benefits from an employer-funded policy.
Permanent Partial Disability (PPD)
Once an injured worker has recovered to the maximum possible extent, the worker may be able to return to employment but nonetheless remain partially disabled, and in most states the worker may potentially qualify for permanent partial disability (PPD) benefits. Michigan does not separately provide for PPD benefits, but workers may receive TPD benefits for the duration of their disability.
Temporary Partial Disability (TPD)
When a worker suffers an injury that limits his ability to return to work, resulting in a reduction of income as a result of reduced hours or wages, the injured worker may be eligible to receive a benefit based on the difference between the worker's pre-injury earnings and their reduced, post-injury earnings. In Michigan, an injured worker may be eligible to receive 80% of the worker's after-tax wage loss. Benefits may be payable as long as the worker's earnings are than would have been earned had the injury not occurred.
For some, more serious injuries, workers' compensation indemnity benefits may be paid according to a statutory schedule, instead of following the standard model of the weekly benefit based on the duration of the disability. Scheduled injuries include such injuries as the amputation of an arm, the loss of a dominant hand, the loss of a leg, the loss of a foot, or the loss of an eye.
Coverage may be available for cumulative trauma, and for mental stress.
When a worker dies as the result of a work-related injury, workers' compensation pays additional benefits, including a burial allowance, and benefits for a surviving spouse and dependents. Survivor benefits are calculated based on the formula for total temporary disability (TTD) benefits, subject to a cap in amount and duration. Benefits may continue for minors until the age of 18, the age of 21 if the dependent is a student, or indefinitely in the event of disability. Spousal benefits end upon remarriage.
Attorney fees are limited to reasonable expenses, and a fee not in excess of 30% of a redemption, or 15% for the first $25,000 recovered and 10% for any additional amount. Attorney fees are subject to review by a worker's compensation magistrate.
This article provides a quick overview of the benefits available to injured workers, but the full formulas used for assessment of benefits, coordination of different types of benefits, and assessment of injuries and disability ratings can quickly complicate the determination of benefits. Also, states frequently revise their workers' compensation laws. Most workers who suffer a significant injury or wage loss as the result of a workplace injury will benefit from consulting a workers' compensation lawyer.
The state agency responsible for workers' compensation is:
Michigan Department of Licensing and Regulatory Affairs
Workers' Compensation Agency
7150 Harris Drive, 1st Floor
P. O. Box 30016
Lansing, MI 48909