Michigan Personal Injury

An injured worker in the State of Michigan can only receive certain specified benefits, (1) wage loss benefits, (2) medical benefits and (3) rehabilitation benefits. This post will deal only with wage loss benefits.

CALCULATION OF WAGE LOSS BENEFITS
Generally, an injured worker will recieve 80% of the after-tax value of his or her wage loss regardless of whether the worker is totally or partially disabled from working. To determine this amount, the worker's average weekly wage is calculated by averaging the highest 39 of the last 52 weeks of wages earned by the worker prior to the injury. 80% of the after tax value of this amount is then determined from tables published by the Workers' Compensation Agency that take into account the worker's tax filing status, the number of dependents and the state and federal tax rates.

MAXIMUM BENEFITS PAYABLE TO INJURED WORKER
The law also provides a maximum rate of benefits paid to the worker which is 90 percent of the state average weekly wage for the year prior to the injury. This means that a worker will not receive benefits higher than this amount regardless of how high his or her earnings might have been. The State average weekly wage can be accessed at http://www.michigan.gov/wca/0,1607,7-191--38774--,00.html. Generally there is no minimum benefit.

TAXATION OF WAGE LOSS BENEFITS
Wage benefits paid to an injured worker are generally not subject to either state or federal income tax.

DURATION OF WAGE LOSS BENEFITS
For wage loss benefits to be paid, the disability resulting from the injury must last at least one week. If the disability extends beyond a week, benefits begin on the 8th day following the injury. If the disability extends two weeks or more, the worker is entitled to benefits from the date of the injury until the disability ends.
Depending on the severity of the injury, wage loss benefits may be paid for weeks, months, years or for the rest of the worker's life. This is unlike Michigan No-Fault law that only requires an insurance company to pay for the first 3 years of wage loss regardless of the extent of the injury.

OTHER BENEFITS AND THEIR RELATION TO WAGE LOSS BENEFITS
Wage loss benefits are required to be coordinated with many other benefits to which an injured employee may be entitled. With respect to Sickness & Accident Benefits, Pension Benefits or other similar benefits paid for by the employer, the employer will be entitled to a dollar for dollar reduction in payable wage loss benefits. For example, if a worker received $100.00 per week in S&A benefits paid for by his or her employer, the wage loss he or she receives will be reduced by $100.00 per week for the period S&A benefits are paid.

Both the employer and employee pay in equally for social security benefits. Therefore, there is only a 50% reduction for social security retirement benefits.

Social security disability benefits are already reduced based upon an injured employee's receipt of worker's compensation benefits so there would be no reduction in the amount of wage loss paid to the employee