The statute which governs the jurisdiction of the Michigan Workers’ Compensation Agency over out-of-state injuries, MCL 418.845, was amended by 2008 PA 499. It became effective January 13, 2009. The bipartisan amendment was enacted in response to the Michigan Supreme Court’s decision in Karaczewski v Farbman Stein & Co., 478 Mich 28, 732 NW2d 56 (2007). Karaczewski overruled prior case law and held that MCL 418.845 provided for Michigan jurisdiction of out-of-state injuries only if (1) the employee resided in Michigan at the time of injury and (2) the contract of hire was made in Michigan. Previous case law had not enforced the residency requirement. Following the Supreme Court’s decision in Karaczewski, the legislature enacted 2008 PA 499, effective January 13, 2009, amending MCL 418.845. The amendment provided jurisdiction of out-of-state injuries “if the injured employee is employed by an employer subject to this act and if either the employee is a resident of this state at the time of injury or the contract of hire was made in this state” (Emphasis added.) On May 10, 2010, the Michigan Supreme Court issued its opinion in Brewer v A. D. Transport Express, Inc. (Case# 139068, May 10, 2010). In that case, Mr. Brewer (plaintiff), a Michigan resident, sought workers’ compensation benefits under Michigan law for an injury he allegedly suffered in Ohio in 2003 while working for the defendant employer as a truck driver. The employer denied that plaintiff’s contract of hire was made in Michigan and the Magistrate found that plaintiff had failed to prove where and how he was hired. The Magistrate dismissed plaintiff’s Application for Mediation or Hearing. The Workers’ Compensation Appellate Commission affirmed, finding no facts that would allow the Magistrate to conclude that the contract of hire was made in Michigan. The Court of Appeals denied plaintiff’s application for leave to appeal. Plaintiff applied for leave to appeal to the Michigan Supreme Court. The Michigan Supreme Court agreed to hear the case on the limited issue of whether the legislative change to MCL 418.845 by 2008 PA 499, should be applied to plaintiff’s case. The Supreme Court, in a 5-2 decision, affirmed the decision of the Workers’ Compensation Appellate Commission upholding the Magistrate’s dismissal of plaintiff’s petition for lack of jurisdiction. The Supreme Court held that the amendment of MCL 418.845 enacted by 2008 PA 499 does not apply retroactively to cases in which the claimant was injured before the effective date of the amendment. (Slip opinion at 9.) The court noted that the amendment contained no language clearly manifesting a legislative intent that it apply retroactively. Id. The court also observed that, by expanding the Workers’ Compensation Agency’s jurisdiction “to include out-of-state injuries suffered by Michigan employees whose contracts of hire were not made in Michigan, the amendment imposed a new legal burden on out-of-state employers not previously subject to” the Agency’s jurisdiction. Id., at 8-9. The court further noted that the amendment “also potentially enlarged existing rights for Michigan residents injured in other states under contracts of hire not made in Michigan.” Id., at 9. In summary, the statutory amendment enlarging Michigan Workers’ Compensation Agency jurisdiction over out-of-state injuries, effective January 13, 2009, was held not to be retroactive to injuries occurring prior to the effective date of the amendment. If you have any questions regarding out-of-state jurisdiction or would like to discuss this matter further, please contact us at your convenience. 05/18/10