Workers’ Disability Compensation Agency publishes Michigan workers’ compensation rates for 2021 and learn how to double check insurance company math.
Michigan workers’ compensation rates 2021 have now been published. The maximum weekly comp rate for 2021 is $975.00. This is based upon 90% of the state-wide average weekly wage.
The idea is to limit disabled employees to what most people in Michigan are earning. It does not matter how much a disabled employee was earning before getting hurt. Unfortunately, this maximum punishes high wage earners who are stuck with this cap. There are no minimum payments except for specific loss and death.
Watch out for insurance companies who simply estimate the weekly rate. Here is how to double check insurance company math and make sure the correct Michigan workers’ compensation rates for 2021 are being used so that the correct amount is being paid.
Step 1: Calculate the average weekly wage
Calculate the average weekly wage (AWW) using pay stubs from the 52 weeks before getting hurt. Make sure to include overtime in the gross amount. The value of discontinued fringe benefits can also be included under specific circumstances. Even second jobs that cannot be performed now can be used.
We recommend organizing 52 weeks of pay stubs in order from highest amount to lowest amount. Select the highest 39 pay stubs and add these weekly amounts together. Divide this total amount by 39 to calculate the average weekly wage. Use all paystubs if you worked 39 weeks or less for this employer.
Step 2: Use benefit table to find weekly Michigan workers’ compensation rates 2021
Disabled employees should receive 80% of their after-tax average weekly wage. Tables published by the Agency show the Michigan workers’ compensation rates 2021. The amount paid is based upon AWW, tax filing status, and number of dependents. Disabled employees can also make use of an online calculator. Wage loss benefits under workers’ compensation are income tax free.
Step 3: Resolve any math errors
Math errors occur when the employer does not cooperate and fails to provide wage records. Do not let the insurance company estimate the weekly rate by just using hourly wage. Our experience shows that disabled employees are leaving money on the table when this occurs. It could also impact settlement value if the weekly rate is not corrected prior to the start of negotiations. Give pay stubs directly to the insurance company if the employer refuses to cooperate. Speak with an experienced workers’ compensation lawyer if weekly checks are too low.
Michigan law also permits insurance companies to pay less based upon post-injury wage earning capacity (PIWEC). They use “phantom wages” to reduce the weekly amount paid. It is critical to speak with an experienced workers’ compensation lawyer if this occurs. Vocational assessments by insurance company representatives are not fair and can be challenged in court. A good-faith job search can be used to show that no employer will accept current restrictions.
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.