New Developments for Michigan Employers

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Beginning March 29, 2019, Michigan laws are changing in a way that will greatly impact employers. Specifically, pursuant to the Improved Workforce Opportunity Act (MCL 4008.934). Michigan’s minimum wage will increase from $9.25 to $9.45 an hour. (MCL 408.934).

This increase is only the first of 12 minimum wage increases, with the final increase scheduled to raise minimum wages to $12.05 an hour in 2030. The scaled increase was adopted by the Michigan Legislature following voter’s approval of same in November 2018. See Public Act 368 of 2018. Of further note, tipped employees set wages will also increase as their wages and tips must equal at least the minimum wage. (See MCL §408.934(d)). In order to comply with these changes, Michigan employers will need to revisit the wages of their employees as soon as possible.

Furthermore, effective March 29, 2019, the Michigan Paid Medical Leave Act (MCL §408.961 et. seq.), also known as the “Earned Sick Time Act” will change the requirements for employers to provide paid medical leave to their employees. The Paid Medical Leave Act applies to employers with 50 or more employees only. Such employers in Michigan are now required to provide paid medical leave to their employees for personal or family needs. The term “personal or family needs” provides the right to paid leave in various situations. The leave includes those who are requesting time off due to mental or physical illness, injury relating to domestic violence or sexual assault, and due to closing of the place of employment or a child’s school due to public health emergencies. The Act extends the request for time off to cover either the employees or family member’s needs. (See MCL §408.964).

Under the Act,  the amount of paid leave per employee is based on an accrual calculation, in which the employee earns an hour of paid leave for every 35 hours worked. (See MCL §408.963).  There are limitations to the scope of the Act, however. An employer has the right to limit the amount of paid leave accrued to 40 hours per year and can require that new employees wait until 90 days after the beginning of their employment before they are eligible to use any accrued paid leave. (MCL 408.963). Furthermore, the Act does not apply to all employees working for Michigan employers. The Act specifically excludes those employees who live outside of the State of Michigan, those who are employed for less than 25 weeks a year, and any employee who is exempt from the Fair Labor Standards Act due to being an executive, administrative, or professional employee. (See MCL §408.962). Employers who meet the threshold to be covered under the Act will need to revise their handbooks and leave policies in order to fully advise employees of their rights under the Act.  Furthermore, it is recommended that the new leave policies be included in training and onboarding of all employees. 

Segal McCambridge attorneys provide assistance to companies - revising employee handbooks and training employees and supervisors to make sure that their practices and policies fully comply with all relevant employment laws.

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