Part 1 of 3: Workers’ Comp Formula

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Calculation of wage loss benefits when the insurance company makes an error.

Most employees hurt at work get medical treatment and quickly return to their jobs. Sometimes an employee is unable to work for a period of time. Wage loss benefits under workers’ comp begin on the 8th day. They continue for as long as an employee is disabled.

The amount paid should equal 80% of the employee’s after-tax average weekly wage. This is calculated using the highest 39 paid weeks during the 52 weeks before injury. Overtime, premium pay, bonuses, discontinued fringe benefits, and even wages from a second job can be included. Calculation of wage loss benefits also requires knowing an employee’s tax filing status and number of dependents. Tables provided by the State of Michigan give the weekly comp rate.

Insurance companies frequently underpay disabled employees. This usually occurs when a claims adjuster estimates the average weekly wage instead of obtaining actual wage records from the employer. Here is an example of a common math error.

Example of math error

Kyle is a married man who lives with his two children in Monroe. He works as a machine operator and injured his back while lifting a heavy part. He is paid $18.00 per hour and works 10 hours of overtime each week.

The insurance company calculated $720.00 for his average weekly wage. This was based upon $18.00 per hour x 40 hours per week. His weekly rate is $477.11.

Kyle recognized that his overtime had not been included. He obtained a copy of his wage records showing that he earned an average weekly wage of $900.00. His weekly rate should be $574.58.

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) 201-9497 for a free consultation today.

Related information:

Maximum weekly comp rate for 2018

Photo courtesy of Creative Commons, by Sean MacEntee.

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Author Bio Jeffrey Kaufman

Author
Jeffrey E. Kaufman
Michigan Workers Comp Attorney

Jeffrey E. Kaufman has extensive experience in workers compensation cases and has recovered millions of dollars in benefits for his clients. He believes all injured workers deserve to be on equal footing with insurance companies and employers, and fights tenaciously so their rights are secured and protected.


“Jeff also helped me with getting my Blue Cross bills paid. I would absolutely recommend him and the whole firm. Jeff and the firm did everything they were supposed to do for me and my case.”
Ricardo Perfetto

Hundreds of 5-Star Reviews

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Get Help From our Michigan Workers’ Comp Lawyers Today

You’re not alone. Our Michigan workers’ comp lawyers have been called the best in the state, and our clients love how they’re treated with care, respect, and responsiveness. We will give you the time you need, we will explain your legal rights, and we will always treat you with respect.

Our workers’ compensation and Social Security disability lawyers always put your needs first. Get to know your legal team.

Our attorneys post regularly about common issues related to workers’ comp, including common injuries, settlement calculations, laws, and more.

Injured? It’s Time to Get Some Answers

Don’t let the insurance adjuster push you around. Request your free consultation today.

"*" indicates required fields

This field is for validation purposes and should be left unchanged.

Our attorneys post regularly about common issues related to workers’ comp, including common injuries, settlement calculations, laws, and more.

Our workers’ compensation and Social Security disability lawyers always put your needs first. Get to know your legal team.