Understanding the Differences Between Workers’ Compensation and Personal Injury Settlements In Michigan

At our law firm, we talk to people every single day who are facing the fear, pain, and confusion that come after a workplace injury. We understand being injured at the workplace is so much more than simply missing work. It’s about supporting your family, covering medical bills, and trying to figure out what to do next. Most of our clients never expected to get injured on the job, and when it happens, questions and concerns begin piling up quickly.

How am I going to pay my bills while I recover? What happens if the insurance company denies my claim?

These are real worries people face each and every day, and you do not have to face them alone. Unfortunately, many of these concerns become amplified when insurers deny benefits. One of the most common sources of confusion our Michigan clients face is learning the difference between a workers’ compensation settlement and a personal injury settlement. If you have been injured on the job, understanding this distinction is crucial.

What Is Workers’ Compensation?

Workers’ comp, in Michigan, is a no-fault system. The no-fault system means benefits are provided to the injured employee regardless of who is at fault for the injury, even if it was your own. This is often a huge relief for our clients who blame themselves for what happened.

Workers’ comp benefits usually include a percentage of lost wages, coverage for medical treatment, and sometimes vocational rehabilitation services.

One important distinction and limitation of workers’ comp is workers’ comp does not cover pain and suffering. This comes as a surprise to many injured workers who are in constant pain or emotionally drained, learning those experiences are not a part of the compensation formula.  This trade-off is part of the compromise where workers give up the right to sue their employer in exchange for guaranteed benefits.

Why Would I Want To Settle A Workers’ Comp Claim?

Many of our clients choose to settle their workers’ comp claim in exchange for a large lump-sum cash payment. Basically, this means giving up future benefits in return for a one-time big paycheck. The money received can be utilized for any purpose, typically for continuing medical care, education/job training, paying off debt, retirement planning, and more.

We often see our clients breathe a sigh of relief when a settlement is finalized because for many, it is the first time they feel like they can stop worrying about losing future payments, and focus on rebuilding their life or planning their next chapter. In some cases, depending on the severity of your injury, injured workers can even return to a different job after settling and still retain the full amount of the settlement, effectively being compensated for the disruption in their lives.

Workers’ Compensation vs. Personal Injury Settlements

The critical difference between workers’ comp and personal injury settlements in Michigan is you cannot sue your employer for pain and suffering, even if their negligence caused your injury. This is because of what is called the exclusive remedy provision in workers’ comp law, which means you are limited to the standard benefits of wage loss, medical care, and vocational rehab.

However, if a third party, someone other than your employer, was responsible for your injury, then you can pursue a personal injury lawsuit seeking additional damages, including but not limited to pain and suffering, and emotional distress.

An Example Of A Scenario Where You Could Pursue Both Workers’ Compensation and Personal Injury Settlements

One example of a situation where you may qualify for both is a work-related auto accident. 

If you are injured in a car accident while working, you may receive workers’ comp benefits from your employer’s insurance and file a personal injury claim against the at-fault driver.

Another example would be faulty machinery or equipment.

If your injury was caused by an unsafe machine, or a defective piece of equipment, there is potentially a product liability case against the manufacturer of the faulty machinery or equipment. Any additional compensation from the product liability case would be in addition to your workers’ comp benefits.

Why Does It Matter to Understand the Difference Between Workers’ Compensation and Personal Injury Settlements

Learning and knowing the difference between workers’ comp and personal injury settlements could be the key to protecting your rights and getting the full financial support you need. If you are hurt, do not try to figure this out alone. We at the Law Offices of David Zimmerman do not want you to have to figure this out alone. We are here to help show you your options and fight for the outcome you deserve.

Injured At Work? Contact The Law Offices Of David Zimmerman For a Free Consultation

Request a Free Case Evaluation now at 1-866-464-2889. Clients Represented in Thousands of Workers’ Compensation Claims, Trials, Settlements in Metro Detroit, Michigan, Lansing, MI, Flint, MI, Saginaw, MI, Monroe, Michigan, Michigan’s Thumb and Port Huron areas. Every day we work with our clients as we go about taking care of their crucial legal issues. The trust we develop with our clients is the foundation of our relationships. At the Law Offices of David Zimmerman, our attorneys help our clients achieve their goals by offering premium legal services. We never stop working to continuously strengthen those relationships.