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Employment Costs

In 2012, Governor Rick Snyder signed legislation enacting new "freedom-to-work" laws in Michigan. The legislation gives Michigan workers expanded options when deciding whether or not to join a union.

Unemployment Insurance
To protect workers who lose their jobs through no fault of their own, Michigan businesses pay unemployment insurance on the first $9,000 of wages paid to each worker in a calendar year. Established employers may pay as little as 0.06%.

The unemployment insurance rate is based on the experience rating of the business, which varies depending on how many employees draw unemployment insurance benefits. The new employer rate is 2.7%. Once a business is established in Michigan, businesses' experience ratings vary between 0.06% and 10.3%.

Workers’ Compensation Insurance
Michigan has a competitive workers' compensation (WC) insurance system. Michigan's "open competition" system allows market forces to set the WC insurance rates, thus enabling companies to shop among nearly 250 insurance carriers for the best, lowest-cost options. 

Self-insurance, group self-insurance, deductible plans, and other options are available as well. With such a wide-range of cost-savings opportunities, Michigan businesses can play a significant role in containing or reducing their WC costs.