Michigan Supreme Court’s Ruling Changes Minimum Wage and Sick Leave Laws

The Michigan Supreme Court made a big decision recently, ruling that the state legislature acted unconstitutionally when they changed two important laws about worker pay and sick leave. This ruling means that the original versions of the Improved Workforce Opportunity Wage Act and the Earned Sick Time Act will go back into effect.

This decision is significant for Michigan employers. Starting February 21, 2025, the old laws will be reinstated, meaning changes to the minimum wage and paid sick leave for employees are on the way.

The story started back in September 2018 when the Michigan Legislature initially adopted the two laws but then tried to amend them later in the same legislative session. An advocacy group called Mothering Justice challenged these amendments, claiming they were unconstitutional.

The Court of Claims initially sided with Mothering Justice, but the Michigan Court of Appeals later restored the amended laws. However, the recent Supreme Court ruling reversed that decision, bringing back the original laws that will now mean more benefits for workers.

Now workers can expect a higher minimum wage, which will be set starting at $10 an hour, increasing gradually over the next few years and adjusting for inflation starting in 2029. For tipped workers, their wages will eventually match the regular minimum wage too.

Additionally, when it comes to sick leave, the previous regulations allow for up to 72 hours of paid sick time for larger companies, with smaller companies needing to provide a mix of paid and unpaid leave. This means all employees, regardless of their work status, will have access to paid sick leave.

Employers will have less power to demand paperwork for sick leave, except for longer absences, and will have to cover any costs related to obtaining medical documentation. This could mean extra expenses for employers.

The emotional reactions from the restaurant industry have been particularly strong. Some leaders fear that these changes could lead to many restaurant closures and job losses, especially since many servers rely heavily on tips that may change with the new pay structures.

Overall, this ruling has set the stage for significant changes in employment laws in Michigan, and everyone is encouraged to prepare accordingly well before the deadlines hit.