What items should be included in my workers’ compensation rate?

Michigan lawyer explains how to calculate the workers’ compensation rate and what items should be included.

We get lots of telephone calls and emails from people on workers’ compensation. They want to know if the insurance company is paying the correct amount of wage loss benefits. Questions about overtime, tips, second jobs, and discontinued fringe benefits are common.

Many people live paycheck to paycheck and getting hurt at work is a financial disaster. Disability checks always seem low and the stress can be overwhelming. Here is how to calculate the workers’ compensation rate and double check insurance company math.

Michigan law requires payment to employees who suffer a work-related disability. Wage loss benefits are based upon 80% of the after-tax average weekly wage subject to a state-wide maximum. You can calculate this amount using tables published by the State of Michigan.

Overtime

Many employees receive overtime and/or premium pay. These amounts should be included in the average weekly wage calculation. The same can be held true for bonuses.

Tips

Anyone who works in the service industry is going to get tips. These should also be included in the average weekly wage calculation. Failing to report tips to the IRS can make inclusion much harder.

Second job

Individuals who cannot perform a second job should include these wages in the average weekly wage calculation. It is important to obtain wage records from the second employer.

Fringe benefits

Health insurance and other fringe benefits should also be included if they are discontinued. However, these items cannot be used to raise the workers’ compensation rate beyond two-thirds of the state average weekly wage.

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 (844) 316-8033 for a free consultation today.

Related information:

Maximum weekly comp rate for 2018

Photo courtesy of Creative Commons, by Tax Credits.

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