In Michigan, you need workers' comp once your business meets the state's coverage test: a private employer that regularly has 3 or more people working at one time, or that has even one person working 35 or more hours a week for 13 weeks or longer in the past year, must carry it (MCL 418.115). Public employers must carry it no matter how many people they have. So the answer turns on your headcount and hours, not on a flat one-employee rule.
Who this is for: Michigan owners trying to figure out whether the state requires a policy yet, from a first hire to a growing crew.
The short version
- Michigan uses a headcount-and-hours test, not a one-employee rule: 3 or more people at one time, or one person at 35+ hours a week for 13+ weeks (MCL 418.115).
- Part-time workers count toward the 3-person test.
- Every public employer must carry coverage, whatever the headcount.
- Owners are treated differently by entity: a sole proprietor is never counted, while working partners, corporate officers, and LLC manager-members count unless they opt out.
- Going without required coverage is a misdemeanor, and each day uninsured is a separate offense (MCL 418.641).
How Michigan's coverage test works
Michigan runs two separate triggers, and hitting either one means you must carry a policy. The first is a snapshot: if 3 or more people are working for you at one time, coverage is required right away, and part-time people count in that number. The second catches the small, steady employer: even a single worker triggers coverage once that person works 35 or more hours a week for 13 weeks or longer during the past 52 weeks. Public employers are in regardless of count. Most farms are treated separately and many are exempt, with a narrower rule for larger agricultural crews.
| Your situation | Coverage required? | Why |
|---|---|---|
| 3 or more people working at one time | Yes | Meets the headcount trigger, part-timers included (MCL 418.115) |
| One worker at 35+ hours a week for 13+ weeks | Yes | Meets the single-employee hours trigger |
| One short-term worker under 35 hours a week | Often no | Below both triggers, but adding people can change that |
| Any city, county, or public employer | Yes | All public employers are covered, whatever the count |
Who counts as an employee
Part-time and seasonal staff count the same as full-timers toward the 3-person test. Owners depend on your entity: a sole proprietor is never their own employee, while working partners, corporate officers, and LLC manager-members are treated as employees and count unless a valid exclusion is on file. A worker you pay on a 1099 counts if Michigan would treat them as an employee, which the state decides using a right-of-control test, not the label on the paycheck. Family members you pay generally count, with a narrow carve-out for a relative living in your home as a household worker.
A Detroit example
Illustrative, not a quote. A Detroit cafe owner runs the shop with the owner plus two part-time baristas during the week, and adds a third part-timer on busy weekends. On those weekends there are three employees working at one time, which crosses Michigan's headcount trigger, so a policy is required even though no one works full time. We place coverage, rate the food-service payroll correctly, and make sure the seasonal weekend help is included. See our workers comp for restaurants page.
Real questions Michigan owners ask
Does Michigan require workers comp with just one employee?
Only in one case. A single employee triggers coverage once they work 35 or more hours a week for 13 weeks or longer. Below that, you generally are not required until you have 3 people working at one time.
Do part-time employees count toward the 3-person test?
Yes. Michigan counts part-time workers toward the 3-people-at-one-time trigger, so three part-timers on the clock together can require a policy even if none is full time.
Are public employers treated the same way?
No, they are stricter. Every public employer in Michigan must carry workers comp regardless of how many people it employs, unlike private employers who must meet the headcount or hours test first.
Do I count the owners in the 3-person test?
It depends on the entity. A sole proprietor is not counted. Working partners, corporate officers, and LLC manager-members are counted as employees unless a valid exclusion form is on file for them.
What if my workers are on a 1099?
A 1099 label does not settle it. If Michigan would treat the worker as an employee under its right-of-control test, they count toward the trigger and generally need coverage.
When exactly do I need to have the policy in place?
Before the trigger is met. Once you will have 3 people working at one time, or a worker crossing 35 hours a week for 13 weeks, the policy should already be active so there is no uninsured day.
Why Michigan owners choose Morrow
- We shop the right market for you. In Michigan you buy workers' comp on the open market from any private carrier licensed in the state, because Michigan has no state fund; if no carrier will take you, the Michigan Workers' Compensation Placement Facility (the assigned-risk plan) is the guaranteed fallback, so we can shop your rate freely and still keep a backstop for hard-to-place work.
- We catch pricing mistakes. Your price depends heavily on the category your work falls into for pricing (the class code). Put people in the wrong category and you overpay for years. We review your payroll and classifications before you buy.
- Proof of coverage, fast. Need a certificate (proof of coverage) for a general contractor or a landlord before Monday? We turn those around the same business day for most carriers.
- We help lower the score that drives your price. Insurers give you a score based on your past claims that raises or lowers your cost (the experience modification rate). We review it each year, flag errors, and connect you with return-to-work and safety resources that bring it down.
- Real people when a claim happens. When someone gets hurt, we stay involved through the life of the claim, not just at renewal.
Related Michigan guides
Every Michigan business is set up a little differently. These companion guides answer the same question for other situations, plus the national explainers behind the terms used here.
- Business insurance in Michigan (start here)
- I own an LLC: do I need workers comp?
- I'm a sole proprietor: do I need workers comp?
- I own a corporation (C-corp or S-corp): do I need it?
- We're a partnership: do we need workers comp?
- We're a nonprofit: do we need workers comp?
- My workers are 1099: do I still need it?
- Only part-time or seasonal staff: do I need it?
- I only employ family: do I need workers comp?
- Remote or out-of-state staff: do I need coverage?
- What happens if I don't carry workers comp?
- How much does workers comp cost?
- How do I get workers comp (even if turned down)?
- What insurance do I need for a contractor license?
- Workers compensation insurance, explained
- What workers comp costs (national guide)
- Hiring your first employee: what changes
- What workers comp does not cover
- Michigan restaurant workers comp
This guide is general information, not legal advice. Michigan rules and penalty amounts can change, so verify current requirements with the Michigan Workers' Disability Compensation Agency (WDCA) or a licensed advisor before you rely on them. Last updated: July 2026.