There are several different aspects to consider when determining if you need to carry insurance and the people you have to cover with Worker’s Compensation in Michigan. This can be confusing for some businesses, especially when you are just starting up, but having the right coverage is essential to protect your business in the event of an accident or injury on the job.
Employee Numbers Count
The type of business you have, the number of employees and the total hours worked will all impact your need to carry Worker’s Compensation in Michigan. If you employ at least one person that works 35 hour or more per week for at least 13 weeks in the past 52 weeks you have to have coverage. If you have at least three employees on staff at one time, even if they only work part-time, you need to have worker’s compensation insurance in Michigan.
In addition if you are an agricultural business and you hire and employ three or more people that work for at least 35 hours per week for 13 weeks in a row you have to have coverage. For those that hire domestic servants to work at least 35 hours per week for 13 weeks of the last 52 weeks you are also required to provide Worker’s Compensation in Michigan.
Exclusions
There are also exclusions to the above requirements that need to be carefully considered to avoid paying into Worker’s Compensation in Michigan if it is not required. Exclusions include for a sole proprietor or a sole proprietor that is hiring a spouse, a child or a parent. Partnerships are excluded as the partner is not considered an employee. In addition if the business is stock corporation and all employees are considered corporate officers and own at least 10% of the total amount of company stock. The same 10% rule applies if you are a Limited Liability Corporation (LLC) and the employees are both members of the LLC and managers.
Understanding the ins and outs of Worker’s Compensation in Michigan can be complicated. Talking to an approved Worker’s Compensation insurance company in the state can help clear up any confusion you may have and ensure you have the coverage you are required to carry.
