Michigan Workers' Compensation Claim Handling Guidelines
- 1 DEFINITIONS
- 2 EXCLUSIVE REMEDY
- 3 JURISDICTION AND LIMITATIONS OF ACTIONS
- 4 COMPENSABILITY
5 EXCLUSIONS AND DEFENSES
5.1 Course of Employment
- 5.1.1 Engaged in the Furtherance of Employer’s Business
- 5.1.2 Not in Furtherance of Employer’s Business
- 5.1.3 Business Travel
- 5.1.4 Commuting
- 5.1.5 Premises and Parking Lot Cases
- 5.1.6 Recreational/Social Activities
- 5.1.7 Activities that Benefit the Employer
- 5.1.8 Lunch Hours
- 5.1.9 Intentionally Self-Inflicted Injury/Death
- 5.1.10 Drug or Alcohol Use
- 5.1.11 Horse Play
- 5.1.12 Fights
- 5.1.13 Social and Recreational Activities
- 5.1.14 Increased Risk and Idiopathic Fall Cases
- 5.1 Course of Employment
- 6.1 Calculation of Average Weekly Wage
6.2 Total Disability
- 6.2.1 Vocational Rehabilitation
- 6.2.2 Earning Power Assessment
- 6.2.3 Employer Job Offer
- 6.2.4 Vocational Expert
- 6.2.5 Amputation and Loss of Use
- 6.2.6 Disfigurement/Scarring
- 6.2.7 Loss of Sight
- 6.2.8 Loss of Hearing
- 6.2.9 Penalties
- 6.2.10 Interest
- 6.2.11 Costs
- 6.2.12 Counsel Fees
- 6.2.13 Death Benefits
- 6.2.14 Death Benefits/Amounts of Benefits
- 6.2.15 Medical Benefits
- 6.2.16 Refusal of Medical Treatment
- 6.2.17 The Right to Choose a Physician
- 7 SUBROGATION OR CREDIT
- 8 ATTORNEYS
- 9 LITIGATION AND APPEAL
- 10 SETTLEMENT
- 11 INSURANCE
Almost all businesses/employers within the State of Michigan are required to comply with the requirements of the Michigan Workers’ Disability Compensation Act with the exception of
1) private employers who have less than three (3) employees at any one time;
2) employers that employ one or more workers but none of whom work less than thirty-five (35) hours per week for thirteen (13) weeks;
3) workers covered by federal law inclusive of veteran’s hospitals, members of the armed forces, postal workers, interstate railroad employees, seaman on navigable waters, and people are loading and unloading vessels (who are additionally covered by federal law).
According to Section 171 of the Michigan Workers’ Disability Compensation Act, a contractor/employer that engages in an undertaking with a subcontractor who is either uninsured or not subject to the Act may become a “statutory” or “shoot-through” employer if an injury occurs to an employee of the subcontractor. However, the injured party must be an employee of the subcontractor. Independent contractors may not be statutory employers.
In regard to employment injuries and injuries incurred through employment prior to January 1, 2013, the determination involves evaluation of a five (5) point test investigating
1) is there a contract;
2) is it a contract “of hire”;
3) does the person maintain a separate business;
4) does the person hold himself or herself out to and render service to the public; and
5) is the person an employer subject to the Act .
For employment determination subsequent to January 1, 2013 the Michigan statute was changed to utilize the Internal Revenue Service revised Rule/Form 87-41 involving a process commonly referred to as the “20 Factor Test.” Essentially, the Internal Revenue Service utilized, in that process, common law rules to identify 20 factors to determine whether an employer-employee relationship exists.
The determination of an injured worker status as either an independent contractor versus employee is set forth in "Employee" above.
While accurate that an employee claiming injury arising out of and in the course of employment can only receive, and claim, workers’ compensation benefits, and while it is equally true that he is barred by the Act from pursuing a civil action for damages incidental to those injuries, there are minimal, but very real, exceptions to that principle. Section 131(1) of the Act does provide liability to the employer in the event of what is described as “intentional tort.” That is, if it can be proven that the employer deliberately took action with specific and observable intent to injure the disabled worker, then a direct action against the employer may lie on behalf of the employee. In addition to that exception, Michigan, as well as federal law, gives any worker, whether injured or not, the right to file a direct action on matters of civil rights, labor and other statutory and constitutional claims which would otherwise arise between the parties. In short, it is only, typically speaking, a lawsuit that is predicated upon that specific injury or occupational disease arising out of the employment that is prohibited or barred by the Michigan Workers’ Disability Compensation Act.
The Michigan Workers’ Compensation Statute allows a cause of action and claims jurisdiction to actions involving injuries which occur within the geographical confines of the state, as well as to residents of the State of Michigan irrespective of the site of the injury.
Michigan will entertain administrative litigation involving out-of-state employers and/or injuries, but involving Michigan residents.
No Statute of Limitation exists in litigation in the filing of Applications for Hearing in Michigan litigation. However, there does exist a prohibition relative to the duration of benefits reaching into the past that can be secured by an employee. In the event that notice of a specific injury and/or event has been provided to an employee, at the time of filing of his Application for Hearing, he is allowed to recover two (2) years back inclusive of his claim for ongoing benefits. In the event that no notice of an injury and/or event has been provided to the employer, the employee is limited to a one (1) year back recovery.
Michigan has no formalized discovery in workers’ compensation claims. However, at the time of filing of an Application for Hearing, the employee is required to disclose all medical facilities and/or individuals from whom he has secured treatment. Subpoenas may then be issued and those records are then forwarded to the attorney who issued the subpoena. Concurrent with receipt of those records, the recipient is required to disclose to the opposing party the issuance of the subpoena and to provide a copy of those records received.
There is a general requirement that notice be provided to the employer by the employee of an event or injury within a reasonable time. However, the consequences of failure to provide such reasonable notice only results in those consequences described in "Time Limitation" above.
See "Time Limitation" above relative to the absence of any complete bar to the filing of an Application for Hearing in the State of Michigan based upon the date of filing
No special rules exist in terms of either implementation or waiver of either a statute of limitations or prohibition of accrued benefits in death cases. As mentioned above, recovery back is subject to the statute of limitations.
No special rules exist in terms of either implementation or waiver of either a statute of limitations or prohibition of accrued benefits in occupational disease or death cases. As mentioned above, recovery back is subject to the statute of limitations.
Michigan honors medical conditions which are traditionally viewed as occupational diseases in terms of acknowledging that some conditions based upon exposure to irritants or otherwise, lead to an ultimate disability after long periods of exposure. In addition to the traditional “dust diseases,” Michigan also recognizes that multiple individual specific injuries that might not in and of themselves individually be the basis of disability but might ultimately, after a period of time and repetitive injury, result in a disabling condition. In such circumstances, it is the employer on the last date of injury, who is deemed to be responsible for the cumulative disabling condition, and is responsible to the employee, but thereafter the employers and/or insurers responsible for the prior specific injury events are left to litigate, between themselves, as to the proportional share of responsibility for the disability, and they might become liable to the last date of employment insurer/employer for reimbursement of benefits paid.
In a general sense, an employee must be “disabled” as the result of a work-related injury and/or occupational disease. However, in addition to the requirement that the medical standard of disability be satisfied, an employee must also establish lost income from that condition. In claims after January, 2012, a question of residual “capacity” has been codified in the workers’ compensation statute. It had previously been placed at issue by a Supreme Court case referenced as Stokes v. Chrysler Corporation, 481 Mich. 266, *; 750 N.W.2d 129 (2008) but is now very clearly a required element in a determination as to the amount of indemnity payment an employee is to receive during the period of his disability.
An injury is a specific event resulting in a physical condition.
While it is not necessarily the case that an “accident” is required in order for a specific injury to occur, it is true that there must be a causal relationship between the employment and the resulting medical condition.
While not frequently the case, if a causal relationship between an infectious disease condition and the employment can be established, there is no reason that said conditions could not be compensable.
Certain disabilities under recent revisions of the Act are compensable only if the employment contributed to the disability in a “significant manner.” This standard applies to “mental disabilities and conditions of the aging process, including, but not limited to heart and cardiovascular conditions.” Recent amendments have also included “degenerative arthritis” into the list of those conditions of aging for which causation in a “significant manner” is required.
Psychological injuries are compensable if found to be disabling but must arise out of real circumstances within the work place or environment, not merely perceived circumstances or events.
The distinction between a traditional “occupational disease” and an “injury not attributable to a single event” has narrowed over past years but still remains slightly different. The language of the Michigan statute as interpreted by the appellate commission and in recent court cases would infer that the most critical factor in determining if the disability is an occupational disease is the degree to which the resulting disability is characteristic of a certain type of industry or employment. A determination of a claim being one incidental to an occupational disease becomes important primarily to the extent that there are certain alternatives available to the employer in terms of relief from the State of Michigan existent through certain state funds that have been constructed over the years to assist employers in compensation of these claims.
Section 301 of the Act indicates that payment of workers’ compensation benefits to an employee is to occur when a personal injury arises out of and in the course of employment. That general principle is subject to a number of interpretations in terms of what comprises “course of employment.”
It is basic that injuries that occur while a worker is going to or from work are not covered. Coverage commences when an employee is on the employer’s premises. Unfortunately, even that basic principle is covered by a required evaluation to determine whether it is subject to an exception. The court has held that inquiry needs to be made as to:
1) whether the employer paid for or furnished employee transportation;
2) whether the injury occurred during or between working hours;
3) whether the employer derived a special benefit from the employee’s activities at the time of the injury;
4) whether the employment subjected the employer to excessive exposure to drastic risks.
See "Engaged in the Furtherance of Employer’s Business" above.
Employees engaged in business travel, and injured during the course of that trip, are generally the subject of a two-prong analysis. First, was the trip itself a part of and necessitated by the employment and second, what activities occurred during the course of that travel that were business-related. In short, a factual determination that there was a “deviation” from business purposes could result in a denial of compensability. Compensability could be deemed based upon the injury not occurring “in the course of employment.”
Payment by the employer to the employee or for transportation to work, or furnishing transportation, tends to bring travel, including travel to and from work, within the course of employment.
Section 301(3) of the Act indicates “an employee going to or from his or her work, while on the premises where the employee’s work is to be performed, and within a reasonable time before and after his or her working hours, is presumed to be in the course of his or her employment.” For the most part, if a parking lot is owned by the employer, injuries occurring there are covered.
Section 301(3) of the Act indicates “notwithstanding this presumption, an injury occurred in the pursuit of an activity the major purpose of which is social, or recreational, is not covered under this Act.” Accordingly, if an employee is engaged in such activity, even if it occurs within a “reasonable time” before or after work and albeit on the employer’s premises, could well be excluded from benefits.
If an employer is deriving a benefit or series of benefits from an employee’s activity, that factor may bring a disabling event “within the course of their employment” even though it might otherwise be excluded.
Lunch breaks occurring on the employer’s premises, and injuries occurring during those times, are generally compensable. However, if a worker is injured off of the employer’s property and engaged in some form of personal business during that lunch hour, the injury is not compensable.
Section 305 of the Act states that if the employee is injured by reason of his intentional and wilful misconduct, he shall not receive compensation under the provisions of this Act.” “Intentional and willful misconduct” has been differentiated from negligent and even grossly negligent acts. However, a recent Michigan Supreme Court case has held that if an employer is able to establish that an employer’s regulation has been regularly and uniformly enforced, and if there is a knowing violation of that regulation, then the Plaintiff’s “intentional” misconduct bars any receipt of benefits. Daniel v Department of Corr, 468 Mich 34, 658 NW2d 144 (2003); Compare Shepard v Brunswick Corp, 36 Mich App 307, 193 NW2d 370 (1971); Allen v National Twist Drill & Tool Co, 324 Mich 660, 37 NW2d 664 (1949).
Michigan has no specific portion of their statute that bars recovery by employees who are engaging in either alcohol or drug use at the time of their alleged injury. Issues involving these matters are typically litigated within the frame work of “misconduct” discussed above. If the injury or other event upon which the claimed disability is predicated is the result of alcohol or drug use, a factual link to the injury because of those circumstances must be established in order to deny benefits.
Michigan courts have generally held that a certain amount of “horse play” in the work place is an anticipated and expected activity and that this activity does not amount to intentional and willful misconduct as described above.
No specific provision of the Michigan Workers’ Compensation Act addresses injuries arising from these events. There is dicta and authority flowing from the Michigan Appellate Commission, not the judicial system, which has reflected that “the general rule” is that if the assault is unconnected with the employment, and the assault is motivated by personal reasons, it usually does not arise out of the employment.
As described at greater length previously, “an injury incurred in the pursuit of an activity the major purpose of which is social or recreational is not covered under this act.” The primary litigation concern factual investigations into whether or not the activity existent at the time of the alleged injury does in fact qualify under the terms of this provision.
It is generally true that not every medical condition that arises at work is compensable, particularly when there is a personal element to the condition. For example, if a person suffers from epilepsy and suffers a seizure and falls, those events are generally viewed as idiopathic and not compensable. However, it was clearly noted, by way of a limitation, that if the court had determined that “the employment placed the employee in a position where the risk of injury was greater, like on a platform or ladder, even an idiopathic fall could be compensable.”
If an employee is unable to work, a determination is made of that employee's "average weekly wage" by obtaining the last 52 weeks of employment and selecting the highest 39 of those weeks, averaging same, and then paying the employee benefits equal to 80% of the after tax value of that amount. The amount of benefits, as well as vacation time, other accrued time as well as other compensated time is to be included in the average weekly wage computation. If an employee were to obtain "restricted or light duty work" and return to work but receive wages less than his or her average weekly wage at the prior job, that employee would then receive a benefit equating to 80% of the after tax value of the difference.
To the extent that an employee has worked less than 39 weeks during the year prior to his or her injury, then only those weeks during which that work was actually performed are utilized in computation of the average weekly wage. As referenced above, "fringe benefits" would include the cost of health insurance, employer contributions to a pension plan, and vacation and holiday pay. To the extent that subsequent to an injury benefits of the type described are continued, they are not computed in the average weekly wage. If at some point in time post-injury those benefits are discontinued, then the average weekly wage is to be recalculated and benefits adjusted accordingly. The calculation of a determination of "80% of the after tax value of a given wage" is, in fact, calculated by the workers' compensation agency and issued in tables to employees and insurance companies. The agency includes factors such as tax filing status, number of dependents, and state and federal tax rates. The Workers' Compensation Act provides that the tables issued by the Bureau are conclusive and binding upon the parties.
However, it is equally true that the Act provides that the maximum rate of benefits is 90% of the state average weekly wage for the year prior to the injury. Irrespective of the income of the employee at the time of the injury, the benefit rate, subject to the above calculation, will never be any higher than the resulting 90% of the state average weekly wage.
As to commencement of benefits, Section 311 of the Act provides that no compensation for a claimed injury is to occur until one week post injury. If the disability lasts longer than seven days, the injured employee is entitled to benefits commencing on the eighth day of injury, and if the disability continues for a period of 14 days or longer, then the employee is entitled to compensation for the length of the disability inclusive of the first week of disability. Benefits are to continue to the employee for as long as the disability exists, which could potentially be for the duration of the employee's life. However, subsequent to age 65, benefits are reduced 5% per year until the employee is 75 years of age. Such an ongoing reduction would result in a total reduction of 50% by the time age 75 has been achieved. It should be noted that the 5% reduction only applies to an employee who is concurrently receiving Social Security benefits.
As discussed above, the benefit rate is established by the date of injury, average weekly wage, and the calculations performed by the Bureau based upon tax returns, dependents, and so on. After that formula results in a benefit amount, there are generally no increases in the benefit rate available to the employee even if the employee might have received increased wages if his employment had continued absent an injury and a resulting disability.
If an employee is disabled from his employment, there is no computation relative to that disability being total versus partial.
Either an employer or employee is capable of engaging the employee in a program of vocational rehabilitation, which might include either education, training, or also job placement, in an effort to return the employee to meaningful employment.
Michigan refers to this particular issue as an evaluation of residual wage earning capacity. In short, a vocational expert is to interview the disabled employee, investigate and evaluate his or her abilities in terms of past education, training and experience, and then determine whether there exists any job in the market place for which the employee is capable of performing. That assessment also includes a review or evaluation of the anticipated income to be derived from that employment and is to be incorporated into the calculation of the indemnity benefit payable by the employer to the employee during the pendency of disability.
If an employee operates under a set of physical restrictions, and if an employer is capable of providing a job to the employee within those restrictions, or alternatively is able to secure a job somewhere for that employee within those restrictions, then the employee is required to report to that job and to perform that work. In the event that he fails to do so, his benefits are subject to termination.
The issue of vocational experts has a major role in Michigan. The Michigan Supreme Court in the case of Stokes v. Chrysler Corporation, 481 Mich. 266, *; 750 N.W.2d 129 (2008) determined that inquiry was required to be made into an employee’s education, training and experience in a determination of what jobs that employee could perform within the job market and to incorporate the income potentially derived from those jobs into the benefit amount owed by the insurer and/or employer to the injured employee. This evaluation is typically referred to as a Stokes evaluation and report. The employee is required to establish that he is actively looking for a job on a regular and consistent basis within the frame work of those jobs he is capable of performing, and his failure to do so can result in a denial of his benefits. Stokes v Daimler Chrysler Corp, 2006, ACO, 24; Stokes v Daimler Chrysler Corp, 272 Mich App 571 (2006); Stokes v Daimler Chrysler Corp, 475 Mich 875 (2006).
Michigan does define certain categories of disability for which additional benefits are available and awarded, above that generically set forth under the issues of disability. These particular conditions are referred to as “total and permanent disability” and are established by Section 361(3) of the Act which provides that an employee would be considered totally and permanently disabled if he/she has suffered, during the course of their employment either:
1) total and permanent loss of eyes;
2) loss of both legs or both feet at or above the ankle;
3) loss of both arms or both hands at or above the wrist;
4) loss of any two of the members of faculties and subsections (a) (b) or (c);
5) permanent and complete paralysis of both legs or both arms of one leg and one arm;
6) incurable insanity or imbecility;
7) permanent and total loss of industrial use of both legs or both hands or both arms or one leg and one arm; for the purposes of this subdivision such permanency shall be determined not less than thirty (30) days before the expiration of 500 weeks from the date of injury.
Michigan does not require compensation benefits to be paid for these conditions.
See "Amputation and Loss of Use" above
Michigan does not address loss of hearing under permanent and total disability. However, disability may be established under the general provisions of the act.
Workers’ compensation benefits are due and payable within thirty (30) days of their either being due and owing, or after a billing has been submitted. In the event that they are not paid within thirty (30) days then they are subject to a $50.00 per day penalty up to a maximum of $1,500.00. This penalty used to be compound, and cumulative, but is no longer interpreted in that fashion.
Interest is payable on awards during the pendency of any appeal, but unpaid benefits that are paid on a tardy basis are not subject to statutory interest, only the above penalty provisions.
Michigan does not have any filing fee, costs, or ongoing motion fees, etc. At the time of settlement or redemption, each party is required to pay a $100.00 “redemption fee” to the Bureau. If a settlement occurs, and redemption order entered, then the employer is required to withhold the Plaintiff’s $100.00 redemption fee from the proceeds of the settlement for the purposes of forwarding it, as well as the employer’s fee, directly to the State of Michigan
Attorney fees in both litigated cases and in settlement matters are set by the Bureau. In the event of a settlement for which benefits have been paid voluntarily the rules provide for an attorney fee of ten percent (10%) of the proceeds. In the event that a matter is contested and settled then at the time of settlement the attorney fee for Plaintiff’s counsel is fifteen percent (15%) of the first $25,000 and ten percent (10%) of any amount above $25,000. If a matter is litigated then the attorney fee is thirty percent (30%) of the accrued, and if the matter is placed on appeal, then the attorney fee continues to accrue at thirty percent (30%) until a determination of the appeal. If Plaintiff prevails on the appeal, then that thirty percent (30%) is paid at the conclusion of the appeal.
A claim for death benefits must have a “dependent” as same is defined by the Act in order to be compensable. In the event that there are no dependents the estate of the deceased employee receives only a burial allowance which is not to exceed the sum of $6,000.00.
Under the Michigan Workers’ Compensation Act, it is possible to establish dependency in two (2) ways. First there is a presumed dependency which involves both the widow and children of deceased workers residing with the decedent. Any other individual, other than children of the decedent, must establish that they were, in fact, dependents of the deceased worker. If there is only a partial dependency established then that partial dependency would result in a reduction in the amount of benefits owed by the employer/insured to the dependents.
Benefits are generally determined in the same fashion as for disability claims, but payment to the dependents is in large measure predicated, and it also the subject of significant litigation, predicated upon the results of any investigation into the proportional dependency that the dependent might have upon the deceased employee. This issue can become quite complicated and it is very fact dependent. Benefits are payable for ten (10) years and then cease.
Section 315(1) of the Act provides that the employer must furnish reasonable medical treatment to an injured worker including “medical, surgical, and hospital services and medicines or other attendance for treatment recognized by the laws of this state as legal, when they are needed.” The employer is not necessitated, and that refusal is statutorily supported, to pay for “services performed by a profession that was not licensed or registered by the laws of this state on or before January 1, 1998.” There exists a fee schedule in the State of Michigan which governs “reasonable and necessary” payments for a wide variety of services that are typically and generally performed by the medical profession.
In the event of refusal of treatment by the employee, assuming same has been recommended by a physician, Michigan holds that a worker may not refuse such reasonable treatment if it can be established that the treatment would relieve the disability. In the event that under said circumstances the employee fails to treat, the employer may discontinue the payment of benefits. However, if the employee can establish that the treatment is dangerous or there is a “significant” chance that it will not relieve the claimed disability, the worker is justified in such refusal. When one looks at more traditional and specific types of treatment such as an employee’s refusal to undergo physical therapy, the commission and courts have been clear that each factual circumstance must be reviewed and investigated individually. Factors that the court will review in such a determination are the degree of pain that the treatment might produce, the worker’s age, and the probability of benefit from the treatment.
The employer has the opportunity to direct medical care, and the location of that medical care for the first twenty-eight (28) days. After that time, even if no medical care has been secured, the employee is capable of obtaining care anywhere he or she so chooses.
The Michigan Worker’s Compensation Statute provides for reimbursement from any third party recovery obtained by the employee. If a co-worker was the negligent party causing the accident, no reimbursement is allowed.
See "Motor Vehicle Accidents" below.
Michigan is governed by the Michigan No-Fault Automobile Insurance Act which provides to injured drivers and/or occupants both wage and medical benefits. In Michigan, workers’ compensation benefits are primary, with no-fault benefits being secondary. In motor vehicle cases, the workers’ compensation lien against any no-fault insured recovery is confined to a lien against only those wage loss benefits paid more than three (3) years after the date of loss and/or injury. However, if the injured worker dies as a result of the auto accident the lien applies against all settlement proceeds derived from any third party action.
In those instances in which subrogation is allowed the amount of recovery and the formula to be applied is governed by the case of Franges v General Motors. In essence, that law holds that any recovery by the lien holder also requires the subrogor to absorb the same proportion of reduction in recovery that is the result of the attorney fee to be paid and the costs expended in the litigation as would apply to the Plaintiff himself.
In regard to benefits due and owing to the injured employee obligated to be paid under the Michigan Workers’ Compensation Act, the employer is entitled to a credit in regard to certain benefits which the employee might also be receiving as a result of either disability and/or death to the extent that the employer has contributed in the same proportion that the employer has contributed to those benefits. For example, if the employer has paid for a disability policy that continues the employee’s wages, then they are entitled to a full credit for the entirety of those disability payments. If the employer has paid for fifty percent (50%) of those disability payments, then the employer is entitled to a credit against with workers’ compensation obligation of fifty percent (50%). That principle applies to a wide variety of benefits for which the employer has made either total or partial contribution to secure.
Any attorney practicing within the field of workers’ compensation is merely required to be licensed by the State Bar of Michigan to practice within Michigan. While most attorneys practicing in that field are members of the State Bar of Michigan Workers’ Compensation Section, there is no obligation that such membership occur. No additional certification or specialization is required.
The administrative judiciary of the workers’ compensation system consists of the Board of Magistrates, who are essentially triers of fact and trial judges, and the Michigan Workers’ Compensation Appellate Commission.
The Bureau has a number of offices throughout the state staffed by hearing magistrates. It is the responsibility of the magistrate to be an independent trier of fact at the time of trial, but in the event of a settlement hearing, his statutory charge and obligation changes to determine whether the settlement is “in the best interest of the employee.”
At the time of trial a magistrate is required to issue his opinion, make his decision, and to support each and every of his findings in terms of either a partial or total award of benefits with a myriad of factual support for each finding of fact. The magistrates serve for four (4) year terms and are appointed solely based upon their application and request for appointment to the governor of the state of Michigan. It is only required that they be a licensed attorney.
Trial proceedings are conducted “on the record” and after all witnesses are sworn.
As stated workers’ compensation magistrates are adjudicators who are requested to determine the facts, issue opinions, and make decisions as to the merits of a Plaintiff’s claim. However, they are equally authorized under case law to make appropriate inquiries at trial, as they deem it necessary, to establish a factual record. The willingness of individual magistrates to participate in a trial in that fashion is dependent upon individual personalities and style of administration.
Trial magistrates are required to establish a factual record concerning any finding or fact upon which they are requested to decide and opine. To the extent that there is not a factual record upon which a decision has been made, that decision is subject to remand for further determination.
The Michigan Appellate Commission considers appeals from both the Workers’ Compensation Board of Magistrates as well as the Michigan Employment Security Commission. It has nine (9) members, appointed by the governor and, the standard of review for the Michigan Appellate Commission is governed by Section 861a(3) which provides that a magistrate’s findings of fact must be considered conclusive “if supported by competent, material, and substantial evidence on the whole record.” It is frequently referred to as the “substantial evidence standard.” The Commission is allowed to reverse decisions when it determines that a magistrate’s opinion/decision is “not supported by competent, material and substantial evidence on the whole record.” If it feels that there is an incomplete record which has been formed the Commission is capable of remanding for additional testimony and/or evidence.
Subsequent to a decision/order of the Michigan Workers’ Compensation Appellate Commission being issued the parties are allowed, if they feel there is an error in law, to appeal to the Michigan Court of Appeals. There is no right of appeal, but leave only. Subsequent thereto, an appeal, by leave, also exists to the Michigan Supreme Court. Again, the non-administrative judicial appeals are only properly laid when it is alleged that there exists errors in law in the Appellate Commission decision.
Michigan does encourage some degree of voluntary mediation/facilitation of claims. In the event that a medical provider files a Petition, or an employee files an Application for Hearing In Pro Per, the Bureau automatically conducts a telephone mediation in an attempt to resolve the matter. If the matter cannot be resolved, the claim is assigned to the Bureau’s trial docket.
In litigated or disputed claims, and in the event that the parties are unable to successfully negotiate a resolution, an informal practice has developed in which the parties are encouraged to meet with another magistrate of the Bureau, who is not directly involved with the case, review the factual circumstances of the claim with that magistrate, and to receive the benefit of his thoughts concerning the appropriate and just resolution. However, there is nothing mandatory about that informal practice.
The parties are able to enter into an “Agreement to Redeem Liability” which is in the nature of a settlement agreement between the parties. That Agreement to Redeem Liability is submitted to the magistrate at a hearing, and either the Plaintiff provides live testimony or the Plaintiff’s attorney submits a complete affidavit inclusive of all relevant information signed by the Plaintiff, for consideration by the Bureau. Subsequent to a formal hearing, conducted on the record, and if the magistrate determines that the settlement is in the best interest of the employee, he will sign the order of redemption. That order of redemption reduces the claim to a complete settlement regarding all past, present and future obligations of workers’ compensation benefits to the employee. The employee is requested to express his complete understanding that he will have no future right to receive workers’ compensation benefits. Concurrent with the execution of that agreement to redeem liability, and entry of the redemption order, a document referenced as a Resignation of Employment and Waiver of Seniority is concurrently executed and generally includes within it a release of any and all claims that might have arisen during the course of the employee’s employment inclusive of discrimination, wrongful termination, ADA, etc. Michigan courts have upheld the validity of entry of releases of those type in the workers’ compensation proceeding.
A claim may also be resolved by way of what is referenced as a “voluntary payment agreement.” That document is usually executed under circumstances in which an employee continues to be employed, has returned to work, or otherwise refuses to execute and enter into a full, final and complete settlement. That particular document provides for representation of no liability by the employer, payment of certain monies to the employee, and a release of any and all worker’s compensation benefits which might be claimed by the employee up to and including the date of that agreement. It does not include a future release of benefits.
It is the general rule that all employers which comport with the statutory obligation described earlier must maintain either a workers’ compensation insurance policy, or must qualify as a self-insured employer with the state of Michigan. An annual filing is required and a record of coverage and/or self-insured status maintained by the state of Michigan.
The failure of an employer to maintain workers’ compensation coverage may result in the employer being responsible directly to the employee for workers’ compensation benefits if he is injured under circumstances allowing for such a claim, but in the event that his actions are negligent or in some other way, shape or form subject to tort liability, he remains liable for that tort liability based upon his failure to maintain workers’ compensation coverage.
In instances where an employer is uninsured, and an employee is injured during the course of employment he may file a claim against the employer within the State of Michigan Workers’ Compensation Bureau, and may proceed with a claim against that company and/or individual. However, if the injury arose out of the actionable conduct, whether negligent or otherwise, of the employer, he no longer enjoys the protection from tort liability that arises from the sole and exclusive remedy provisions of the Act.