New Michigan Workers’ Comp law Takes Effect December 19, 2011

The Michigan Legislature, at the urging of the Michigan Chamber of Commerce and the Michigan Manufacturers Association, rammed through a series of amendments to Michigan’s 100 year old workers’ compensation law. An employer friendly, Republican led Michigan House of Representatives and Senate, tried their best to deliver a very generous gift to insurers and employers to mark the moment.

Most of these changes were reportedly needed to “codify” (cement into place) anti-employee decisions rendered in the last few years by conservative ideologues on a judicially active Michigan Supreme Court. These changes passed along party lines, with strong opposition from organized labor and injured workers.

Perhaps contrary to expectations, however, in many ways, these changes actually benefit injured workers. Many of the changes repudiate the slanted and inane interpretation placed on the prior workers compensation law by the Michigan Supreme Court. Gone is the concept of “phantom wages” where wage loss benefits can be arbitrarily reduced, even when an injured working is unemployed. For many injured workers, the new law will be a breath of fresh air.

For both employer and employees, it will create more litigation and more time will be spent in courtrooms arguing about the meaning of the new law and how it is to be applied. A workers compensation system that now moves very slowly will be moving even slower in the months, and perhaps years, to come.

This article will describe a few of the changes and how they may affect injured workers.

Disability Redefined

The law changes the standard for total (and partial) disability, as well as the burden of proof in petitioning for benefits. Under the new law, a claimant is totally disabled if he or she is unable to earn in any job paying maximum wages in work suitable to their qualifications and training. The burden is on the injured worker to show the qualifications and trainings that he or she has, and also disclose potential jobs that they may be able perform based upon those characteristics, and then demonstrate why the injury makes this performance impossible. Failing any of these requirements can result in the refusal of workers’ compensation benefits to the injured worker. A vocational expert will be required to show the injured workers reduced wage earning capacity resulting from the injury.

A claimant is partially disabled if he or she retains a wage earning capacity at a pay level less than his or her maximum wages in work suitable to his or her qualifications and training. This means that a worker must show what jobs they can perform while they are injured, and are required to look for work, discussed in greater detail below.

Causation Changes

The Workers Compensation Agency will now require workplace injuries to be “medically distinguishable” from an employee’s pre-existing condition before awarding benefits. An injured worker must demonstrate that their injury or work activity, or a combination of both, has caused a “pathological change” of any pre-existing condition. Essentially, there must be changes illustrated through objective medical tests, rather than a worker simply reporting a symptomatic change or that “it hurts more now.”

With disabilities stemming from mental illness, the employee’s perception of actual events must be grounded in reality in order to be compensable. Also, mental illnesses that were not caused by physical trauma or on-the-jobs events are not covered.

Claimants must further show a significant link between degenerative conditions and work activities. Conditions such as degenerative arthritis shall be compensable if the employment activities significantly contributed to or accelerated the injury. If the employee cannot show a significant connection, no benefits will be awarded.

“Good faith” Job Searches by Injured Workers

The new law no longer requires employers to provide injured employees with a choice of reasonable alternative jobs given their condition and abilities. The law now requires claimants to conduct a “good faith” job search while receiving workers’ compensation benefits, forcing injured employees to find work while they are injured. In short, the workers will need to show that they are attempting to obtain employment in their field. Benefits may not be arbitrarily reduced, however, unless jobs are “reasonably available” to the injured worker and the injured workers is not making a good faith job search effort.

If an injured employee receives a reasonable job offer (either from their previous employer, another employer, or through the Michigan unemployment insurance agency) and the employee refuses that employment without good and reasonable cause, the employee shall be considered to have voluntarily removed him- or herself from the work force. This would disqualify them from wage loss benefits during the time they are unemployed.

One other major change concerns injured workers fired “for fault of the employee.” If an injured worker returns to lighter work after an injury and is terminated for reasons considered their fault, he or she will not be eligible for workers’ compensation benefits. This could lead employers to fire injured workers, and not face any consequences under the act.

Medical Coverage Extended

The new law still requires employers to provide reasonable and necessary medical care to treat the effects of the injury or disease, but it now extends the amount of time an employer may provide such services to 28 days. The previous rule allowed employees to consult their own doctors after 10 days.

Now, injured employees may only treat with their own physicians after 28 days, nearly tripling the amount of time before an employee can see a doctor that may better understand the condition. This can make it extremely difficult for an employee to receive quality medical treatment for his or her injuries.

Many of these changes have been designed to make an injured worker feel pressure to return to work as soon as possible. This may mean that people are back on the job before their injuries completely heal. No one wants to be out of work. However, this new law makes it needlessly challenging for workers to take the time they need before they return to work.

At this point, speculation abounds as to whether the changes will actually reduce employer costs, protect injured workers or fulfill the promise of bringing business back to Michigan. In the meantime, those injured on the job should contact an experienced workers’ compensation lawyer for information on how the new changes may affect their claim.

Now, more than ever, an injured worker needs to consult with an experienced workers compensation attorney after suffering a serious injury at work.