How low wage earners impact your workers’ compensation benefits and why you should care what your neighbors and co-workers are being paid.
The Detroit Free Press has published another excellent article about James Robertson. He is the 56-year-old man who must walk 21 miles each day to his job and only earns $10.55 per hour. Efforts through social media have raised more than $300,000 to make his life better. A local ford dealer even donated a new car.
According to the article, low wages are the new reality in manufacturing across Metro Detroit. Globalization and the great recession are to blame. “We may not like factory work at $10 per hour when we’re used to them paying $28, but that’s the market wage,” said Lou Glazer, president of the nonpartisan Ann Arbor-based think tank Michigan Future.
Our attorneys believe in paying individuals a living wage. It is outrageous to expect a person to support a family on just $10.00 per hour. Sadly, this amount is actually significantly higher than minimum wage ($8.15 per hour).
Putting aside moral questions, low wage earners also push down workers’ compensation benefits for everybody. The maximum rate is fixed at 90% of the state-wide average weekly wage. This means high wage earners are stuck with an arbitrary maximum regardless of their actual income. Not exactly a fair deal.
Here are some numbers for perspective. The maximum weekly rate for 2015 is $820.00 per week. This is based on a state-wide average weekly wage of $910.71. The most anyone can collect from workers’ compensation is $42,640 per year and only if totally disabled. Insurance companies get a further reduction for wage earning capacity when someone is considered just partially disabled.
Imagine the hardship that Metro Detroit families experience when income is slashed by 10 or even 50 percent after a work accident. There goes any money for retirement or college tuition. Paying the mortgage and meeting financial obligations becomes extremely difficult.
It is time our elected representatives tackle this issue head on. Increasing the minimum wage is a good first start. We should also remove the maximum rate provision from our workers’ compensation law.
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.
Photo courtesy of Creative Commons, by m01229.