Workers' Comp for Commercial Cleaning in Michigan (2026)

How workers' comp works for janitorial in Michigan

Michigan's workers' compensation system is governed by the Worker's Disability Compensation Act (WDCA), MCL 418.101 et seq., and administered by the Workers' Disability Compensation Agency (WDCA). Michigan does not use NCCI for rate development — rates are filed by the Compensation Advisory Organization of Michigan (CAOM), an independent rating bureau that files Michigan-specific advisory rates with the state Department of Insurance and Financial Services. Michigan's WC system has two distinctive features: (1) the benefit formula pays 80% of after-tax average weekly wage (not the standard 66.67% gross wage formula used by most states), and (2) the Michigan Catastrophic Claims Association (MCCA) reinsures catastrophic claims above a statutory threshold and assesses all Michigan policies annually.

Rating bureau: CAOM (Michigan)

The Compensation Advisory Organization of Michigan (CAOM) — caom.com — files Michigan-specific advisory loss costs and rates with the Department of Insurance and Financial Services. CAOM adopts NCCI class codes and descriptions but sets Michigan-specific rates independently. The CAOM advisory rate for class 9014 (janitorial) is approximately $2.25 per $100 payroll for the 2025 policy year. Carriers apply their own approved load factors above the CAOM advisory rate. Michigan is not a member of the NCCI central reporting system.

Class code and rate (Michigan 2025–2026)

• Code 9014 — Janitorial Services by Contractors, No Window Cleaning Above Ground Level & Drivers. CAOM advisory rate: approximately $2.25 per $100 payroll (effective January 1, 2025). Note: Michigan carriers apply individual load factors; actual filed rates vary by carrier. Confirm current advisory rate directly with CAOM (caom.com).
• Code 9170 — Window Cleaning Above Ground Level. Substantially higher; separate payroll required.
• MCCA assessment: All Michigan WC policies carry an annual MCCA surcharge (set each October for the following year). The MCCA October 2025 assessment announcement sets the 2026 rate — check michigancatastrophic.com for current figure. MCCA assessment adds $1.50–$3.00/$100 equivalent to every Michigan WC policy.
• Bid-math note: at ~$2.25/$100 base plus MCCA surcharge (approximately $1.50–$2.50/$100), effective total Michigan WC cost for class 9014 is approximately 3.7–4.7% of gross wages — significantly higher than the base rate alone suggests.

Indemnity benefits (Michigan 2025)

• TTD rate: 80% of after-tax average weekly wage (MCL 418.351, 418.361). Note: unlike most states' 66.67% gross-wage formula, Michigan uses 80% of after-tax (take-home) wages — tables published annually by WDCA show the actual dollar benefit by AWW, filing status, and dependents.
• Max weekly benefit: $1,164/week (2025; = 90% of Michigan SAWW of $1,292.23; MCL 418.355(1); Michigan WDCA 2025 Rate Book, published December 2024).
• No general minimum weekly benefit; for specific loss and PTD claims, minimum = 25% of SAWW ($323.06 for 2025).
• Waiting period: 7 calendar days (MCL 418.301(1)); first 7 days paid retroactively if disability exceeds 14 days.
• PPD (specific loss) benefits: MCL 418.361 schedule; paid at 80% of after-tax AWW for number of weeks specified per body part.
• PTD: payable as weekly wage loss benefits for life; subject to reduction for post-injury earnings (wage earning capacity test under MCL 418.301(5)).

Coverage requirements and exemptions

• Mandatory for employers with: (1) 3 or more employees at any time (including part-time), OR (2) 1 or more employees working 35+ hours/week for 13 or more weeks (MCL 418.115).
• Agricultural employers with seasonal crew exemptions apply.
• Sole proprietors, partners, and corporate officers of closely held corporations may elect to exclude themselves from coverage.
• Independent contractor test: MCL 418.161(1)(n) — employee defined as person performing service "in the course of the trade, business, profession, or occupation of an employer" who does not maintain a separate business, does not hold himself out to the public, and is not an employer under the Act. Michigan's definition captures most janitorial cleaning workers as employees.

Experience rating (Michigan)

Michigan uses CAOM's experience rating plan, which differs from the NCCI plan. Eligibility threshold: approximately $10,000 in expected losses. The CAOM modification formula uses a 3-year experience period, with primary and excess split factors specific to Michigan. Employer experience mods for janitorial in Michigan typically range 0.80–1.35, reflecting high claim frequency (slips, MSDs) but moderate severity (capped by the $1,164/week maximum). Michigan does not use the NCCI ARAP or merit rating programs — CAOM administers all rating modifications.

Officer/owner waivers

Under MCL 418.161, a sole proprietor or partner may be excluded from coverage. Corporate officers who are also the sole shareholder of a corporation may apply for an officer exclusion through their carrier using a CAOM officer exclusion endorsement. LLC members may elect exclusion if they own 10%+ of the LLC. All waivers must be filed with the insurer before the policy effective date and cannot be applied retroactively.

Penalties for non-compliance

• Under MCL 418.641: fine up to $1,000 per employee per day of noncompliance.
• Criminal penalties: up to 6 months imprisonment for willful failure to insure (MCL 418.641).
• Employer is personally liable for all WC benefits that would have been covered, plus attorney fees.
• WDCA actively audits employers through the Michigan Wage and Hour Division and cross-references MCCA data to identify uninsured employers.

Recent rate changes (2024–2026)

• January 1, 2025: CAOM advisory rate for class 9014 at approximately $2.25/$100 (per research data; CAOM files rates annually with DIFS).
• MCCA October 2025: MCCA announced its 2026 assessment rate — see michigancatastrophic.com for current per-employee surcharge figure.
• 2025 SAWW: Michigan WDCA published 2025 SAWW of $1,292.23, setting the $1,164 maximum weekly benefit (90% of SAWW).

Cross-references

• OSHA Requirements for Janitorial Services in Michigan
• Contractor Licensing Requirements in Michigan
• Janitorial Wage and Hour Laws in Michigan

Primary sources

• Michigan Workers' Disability Compensation Agency (WDCA)
• WDCA 2025 Weekly Benefit Rate Book
• Michigan Catastrophic Claims Association (MCCA)
• Compensation Advisory Organization of Michigan (CAOM)
• BLS NAICS 561720 Injury Data

Authored by the Opora Editorial Team.