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I was hurt in a car accident on the job, do I get work comp or MI No Fault?

January 5, 2015 by Steven M. Gursten

In Auto-Owners v. All Star Lawn, the Michigan Supreme Court clarifies this common question

As an auto accident lawyer, a common question I receive from people who are hurt in a car accident on the job is whether Michigan workers compensation or No Fault will cover them. The answer is usually both, but as you’ll see below, there is a priority as to who will pay what.

It’s also a complicated legal issue, as filing a workers compensation case can have an effect on the amount of money you recover for your injuries and pain and suffering if you’ve filed a lawsuit against the driver who caused the car accident. It also can impact your Michigan No Fault PIP benefits. That’s why it’s always best to consult with an experienced attorney when these both workers comp and a PIP or third-party tort case are in play. There are tactical and strategic reasons that can add thousands of additional dollars, so discussing both cases with your attorney and making sure your attorney is working closely with your workers comp attorney is important.

But tactics and strategy aside, as far as determining the benefits that apply to an “on the job” car accident, the answer depends on whether the worker was an “employee” at the time of the wreck.

In Auto-Owners Insurance Company v. All Star Lawn Specialists Plus, Inc., et al., the Michigan Supreme Court recently clarified the requirements of the three-part test used for making the “employee” determination.

Generally speaking, a Michigan auto accident victim is entitled to collect PIP, also known as Personal Injury Protection benefits – after a wreck. These include reimbursement for medical expenses and medical care, and lost wages under our No Fault law.

However, if the victim was an “employee” – i.e., on-the-job – at the time of the collision, then he would be limited to collecting benefits under the work comp system. Unfortunately, work comp benefits are less extensive. Workers compensation benefits also involve the “wage earning capacity” rule.

In Auto-Owners v. All Star Lawn, the Supreme Court ruled that an injured worker is an “employee” when – as provided for in MCL 418.161(1)(n) of the workers’ compensation law – he is “performing [a] service in the course of the trade, business, profession, or occupation of an employer at the time of the injury” and:

  • He “does not maintain a separate business … in relation to this service”;
  • He “does not hold … herself out to and render service to the public;” and,
  • He “is not an employer subject to” the Michigan Workers Compensation Law.

Here’s a more detailed workers compensation perspective on the new ruling, “Employee? Independent Contractor? Who really knows?,” by my friend and very excellent workers compensation attorney Jeffrey Kaufman.

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