LANSING, Mich. — A last-minute deadline-beating deal in the state legislature got a signature of approval from the Governor.
House Bill 4002, which amended the expanded paid sick leave requirement, and Senate Bill 8, which adjusts the state's minimum and tipped wages, were both signed by Governor Gretchen Whitmer on Friday.
The pair of bills were passed months after a Michigan Supreme Court ruling restored a 2018 ballot initiative that would have eliminated the tipped wage scale in Michigan.
Businesses, especially in the restaurant industry, claimed the change would have forced many eateries to close.
While the initiative had enough signatures to go to voters in 2018, the then-Republican-controlled legislature passed the measures into law, then amended them during the lame duck session after the November election.
In 2024, the Michigan Supreme Court ruled lawmakers violated the state's constitution when they amended a voter initiative in the same session as when it became law.
Under a new schedule set by the justices, Friday would have been the first step up in the minimum wage and increase in the tipped wage scale. Most companies would also be required to provide paid sick leave to many employees.
However House Republicans and Senate Democrats spent months negotiating another change to the law. With less than 2 hours to spare on Thursday before the law went into effect, both chambers passed the two bills.
Whitmer signed the bills just before noon on Friday.
“I’m proud to sign these two bipartisan bills into law that will raise wages, ensure workers can take time off to care for themselves or their loved ones, and continue growing our economy," said Whitmer. "This commonsense compromise was made possible by the Republicans and Democrats who worked together to forge a fair, bipartisan deal."
What is changing
Michigan's minimum wage will increase in steps to $15 per hour. Here's how it will change:
- $12.48/hour starting February 21, 2025
- $13.73/hour starting January 1, 2026
- $15/hour starting January 1, 2027
The tipped wage scale will remain in place, but workers who earn tips will receive a higher base pay rate.
Here's the breakdown on the new increases to tipped wages:
- 38% of minimum wage starting February 21, 2025
- 40% of minimum wage starting January 1, 2026
- 42% of minimum wage starting January 1, 2027
- 44% of minimum wage starting January 1, 2028
- 46% of minimum wage starting January 1, 2029
- 48% of minimum wage starting January 1, 2030
- 50% of minimum wage starting January 1, 2031
The paid sick leave requirement now won't start until October 1, 2025. All employers will be required to allow employees to accrue at least 1 hour of paid earned sick time for every 30 hours worked.
Small businesses, defined by the law as those companies who employ 10 people or less, must provide up to 40 hours of paid sick leave each year. Larger companies, those with 11 or more employees, must provide up to 72 hours of paid sick leave. Employers can choose to provide more paid sick time than the law's requirement.
Businesses can also choose to provide paid sick leave at the start of each year instead of making them accrue it.
Employees must also be allowed to carry over accrued paid sick leave from year to year. Small businesses have to allow at least 40 hours to be carried over; large companies must allow 72 hours to move to the following year.
Businesses are not allowed to deny employees from using their paid sick leave or retaliate against them for using it.
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