Michigan residents see income rise

Good news about income levels and how the state-wide average weekly wage can impact your workers’ compensation benefits.

The Detroit Free Press is reporting that household incomes rose by 2.4%. This is the largest annual increase since the 2007-2008 recession and third consecutive year of gains.

We are excited to hear this good news and it will have a wide-ranging impact across the state. Rising income levels also have a positive impact on workers’ compensation benefits.

Individuals hurt on-the-job are supposed to receive 80% of their after-tax average weekly wage. However, this amount is capped at 90% of the state-wide average weekly wage.

The idea is to limit wage loss benefits under workers’ compensation to what most people in Michigan are actually paid. This means high wage earners are stuck with an arbitrary maximum regardless of their income. The maximum weekly rate for 2016 is only $842.00.

Rising income levels result in a higher state-wide average weekly wage. This means greater benefits for people hurt at work even if their salary remains the same.

Sample Calculation

Mr. Smith works as a steel worker in Warren, MI. He gets paid $2,000.00 per week including overtime. He suffers a herniated disc when bending over to lift a 50-pound item.

Workers’ compensation is supposed to pay 80% of his average weekly wage or $1,015.04. But he only gets a maximum of 90% of the state-wide average weekly wage or $842.00.

Assuming his salary remains the same but he gets hurt the following year. Just a 2.4% increase in the state-wide average weekly wage could translate to an additional $22.44 per week. This would result in another $1,166.88 being paid for each year he is disabled.

Michigan Workers Comp Lawyers never charges a fee to evaluate a potential case. Our law firm has represented injured and disabled workers exclusively for more than 35 years. Call (855) 221-2667 for a free consultation today.

Related information:

How do I calculate my average weekly wage?

Photo courtesy of Creative Commons, by 401(K) 2013.

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