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Workers' Compensation for Michigan Businesses
What are the legal requirements for workers’ comp insurance in Michigan?
Based on the Workers’ Disability Compensation Act of Michigan, nearly all employers in Michigan are covered by workers’ compensation. This includes both public and private business owners. There are a few classes of workers who are covered by federal laws and are not covered by the Workers’ Disability Compensation Act of Michigan. Federal government employees (such as postal workers, employees at a veterans, administration hospital, or members of the armed forces) are covered by federal laws. People who work on interstate railroads are covered by the Federal Employers Liability Act. Seamen on navigable waters are covered by the Merchant Marine Act of 1920, and people loading and unloading vessels are covered by the Longshoremen’s and Harbor Workers’Compensation Act of Maine. Virtually all other workers and employers are subject to Michigan’s law.
Certain very small business owners are exempt. If a private employer has three or more employees at any one time, or employs one or more workers for 35 or more hours per week for 13 or more weeks, the employer is subject to the Workers’ Disability Compensation Act and is required to purchase workers’ comp insurance.
What does workers’ comp insurance cover in Michigan?
In the event of a workplace accident, Michigan workers’ comp insurance provides both medical coverage and payments for lost wages and permanent disabilities. This can include temporary or permanent benefits.
Temporary workers’ comp benefits refer to the scenarios of when your employee is unable to work for more than one week, your worker is able to receive compensation for the lost wages, which are called “lost time benefits.” Your employee’s doctor must certify your employee is not able to work.
Lost time benefits are 2/3 of your employee’s monthly income and determined by your employee’s earnings the month before the individual gets sick or is injured in the workplace. This benefit is considered temporary and only lasts while your employee’s doctor is actively treating you. When your employee’s doctor determines that your team member is able to return to work, your employee will receive a letter from the insurance company called a Notice of Claim Status, which clarifies that the doctor said you can officially work again.
If your employee is unable to return to work full-time or can only do modified work, and as a result they are earning less than they usually do, your employee can continue to get time lost benefits, which will be two-thirds of the difference in their earnings.
Permanent workers’ comp benefits refer to the scenario when your employee’s doctor finds that your employee’s condition is stationary, or not expected to improve any further. In this case, the doctor will determine whether your employee has a permanent disability. If your employee does, the doctor will give your worker a percentage of disability. This number, along with your employee’s age, education, work history helps determine your employee’s rate of compensation.
What types of injuries are covered with workers’ comp insurance in Michigan?
Michigan state law determines what types of injuries are covered by workers’ comp insurance, but there are general guidelines that can help you understand what typically qualifies for a workers’ comp claim.
- No intentional self-harm, harm that results from drug or alcohol use, or fighting.
- Must fall within the “course and scope” of employment. If you get into a fender bender on your way home from work after you’ve clocked out for the day, that’s unlikely to qualify.
- Long-term occupational injuries, including back strain from repetitive motion. When you think of work-related injuries, you probably think of one-time events — but damage can occur over a long period of time. As long as the injury or illness is clearly associated with the employee’s work responsibilities, it may be eligible.
*2017 business stats provided by the Bureau of Labor Statistics
number of Michigan residents employed by small businesses
number of workplace injuries
annual cherry production (in pounds)
number of lighthouses
acreage of world’s largest limestone quarry in the Rogers City, MI
Michigan Businesses We Cover with Workers' Comp Insurance
Food & Beverage
Bars, Bistros, Cafeterias/Buffets, Candy Stores, Caterers, Coffee Shops, Doughnut Shops, Fast Casual, Fast Food, Fine Dining, Health Supplement Stores, Juice Shops, Tea Houses, Taverns and NightclubsGet a Free Quote
Data Processing, Ecommerce, Hosting, Graphic Design, Network Installation/Repair, Office Machine Installation/Repair, Programming, Strategy & Management Consulting Services, and Software/Web Development (includes SOLOpreneuers!)Get a Free Quote
Athlete/Actor/Entertainer Agents, Court Reporters, Lawyers & Attorneys at Law, Notaries and TranscriptionGet a Free Quote
Bakeries, Beer/Wine/Liquor Stores, Butcher/Meat Markets, Convenience Stores/Gas Stations, Discount Stores, Fish, Seafood, Fruit & Vegetable Markets, Grocery Stores, Laundromats, Pet Stores, Pharmacies/Drug Stores, Specialty Food StoresGet a Free Quote
Computer Training, Cosmetology/Barber Schools, Exam Preparation/Tutoring, Fine Art Schools, Language Schools, Libraries/Archives, Management Training, Professional Training, & Translation/Interpretation ServicesGet a Free Quote
Microbreweries (less than 15,000 barrels produced per year) & Wine Making (no growing or production of grapes/fruit)Get a Free Quote
Barber Shops/Salons, Cemeteries/Mausoleums, Crematoriums, Funeral Homes, Interior Design, Pet Kennels/Groomers, Photography/Photofinishing, Gyms, Nail Salons, Self-Storage, Tanning Salons, Tattoo/Piercing, and Wedding/Event PlannersGet a Free Quote
Bridal Stores, Clothing Stores, Dry Cleaners, Formal Wear/Costume Rentals, Luggage & Leather Goods Stores, Shoe Retail/Repair, and Tailor ShopsGet a Free Quote
Personal Product Retail
Art Galleries/Stores, Auto Parts, Beauty/Cosmetics, Bike Stores, Bookstores, Camera/Photo Supplies, Cell Phone Retail/Repair, Computer Stores, Jewelry Stores, Musical Instruments, Sporting Goods , Tobacco/Vaping & Video GamesGet a Free Quote
Blood Banks, Dental Labs, Dentists/Orthodontists, GP/Medical Specialists, Kidney Dialysis Centers, Medical Diagnostics & Testing, and VeterinariansGet a Free Quote
Architecture & Engineering Services
Architects & Drafting, Engineering, Surveyors, & Window Treatment Stores (we do not cover construction contractors or trucking companies)Get a Free Quote
Accounting, Auditors, Banks/Credit Unions, Bookkeeping, Collection Agencies, Financial Advisors/Trust Companies, Mortgage & Loan Brokers, Payroll Services, Tax Preparation, Title & Title InsuranceGet a Free Quote
Scientific Research & Development/Consulting, Technical Consulting, & Environmental ConsultingGet a Free Quote
Office, Home, & Garden
Hearing Aid Stores, Hobby/Craft/Art Stores, Gift/Novelty Stores, Florists, Floor Covering Stores, Mailing/Packaging Stores, Models/Toy/Games, Office Supplies, Optical Stores, Paint/Wallpaper Stores, Perfume Stores, Plumbing & TaxidermistsGet a Free Quote
Acupuncture, Chiropractors, Mental Health Practitioners, and Physical & Occupational TherapyGet a Free Quote
Explore commonly asked questions about business type, industry and state.
How is Workers' Compensation related to payroll? What do I do when I hire, give raises or fire employees?