LANSING, Mich. — In a late-night session, lawmakers in Lansing reached a compromise on two crucial bills, preserving the state's tipped wage credit and adjusting requirements for employees earning sick time off. The agreement, signed into law by Governor Whitmer Friday afternoon, has sparked mixed reactions from the restaurant industry and advocacy groups.
Justin Winslow, president and CEO of the Michigan Restaurant and Lodging Association (MRLA), hailed the deal as a victory for restaurant owners.
"Despite a lot of noise, I think common sense prevailed," he told FOX 17 Friday.
Winslow emphasized that the compromise would allow restaurants to keep their doors open and staff employed.
However, Saru Jayaraman, president of One Fair Wage, expressed disappointment, saying that the deal is a big step backward for hundreds of thousands of tipped workers throughout the state.
Jayaraman argued that the legislation would cut the pay of tipped workers and perpetuate a system that leaves them vulnerable.
The signed legislation includes:
- House Bill 4002: Amends the 2018 PA 338, providing workers with the right to earn sick time for personal or family health needs, domestic violence/sexual assault issues, and school meetings related to a child's disability or health.
- Senate Bill 8: Revises sections related to minimum wage rates, gratuities, employer responsibilities, and exemptions. The minimum hourly wage rate will increase incrementally to $15 by Jan. 1, 2027.
The compromise establishes a minimum hourly wage rate for tipped employees, set as a percentage of the standard minimum wage.
Starting Friday, Michigan’s minimum wage rose from $10.56 an hour to $12.48 – and will increase incrementally to $15 by January 2027. After that it'll increase based on inflation. For tipped workers, their minimum wage will stay at $4.74 per hour this year — or 38 percent of the standard minimum wage — before gradually increasing each year until it reaches 50 percent of the minimum wage in 2031.
House Bill 4002 addresses paid sick leave. Under the new law, employees earn at least one hour of paid earned sick time for every 30 hours worked. Small businesses, those with 10 people or fewer, must provide up to 40 hours each year. Larger businesses, those with 11 or more employees, must provide up to 72 hours of paid sick leave each year. Requirements for small businesses don't take effect until October 1.
Wages for tipped workers will increase annually from 38% on Feb. 21, 2025, to 50% on Jan. 1, 2031.
One Fair Wage now plans to collect signatures for a referendum, which could potentially freeze the bills passed.
Winslow countered that a referendum would "actually decrease the minimum wage" from the agreed-upon deal.
As the dust settles, restaurant owners and advocacy groups will continue to navigate the implications of this bipartisan deal.
While some see it as a necessary compromise, others believe it falls short of providing fair wages and protections for Michigan's workers.
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