This past year brought about significant changes to Michigan employment law, especially in regards to minimum wage and paid sick leave.
In 2022, the Michigan Court of Claims reinstated Michigan’s original Improved Workforce Opportunity Act (IWOWA) and Earned Sick Time Act (ESTA), ruling that the adopt and amend tactic used to pass the Paid Medical Leave Act were unconstitutional under Michigan’s Constitution. This ruling immediately voided the Paid Medical Leave Act and the amended version of the IWOWA, reinstating all provisions of the 2018 IWOWA and ESTA. The Court of Appeals did issue a stay until February 20, 2023.
So how did we get here, and what does this mean for employers moving forward?
Path to the new requirements
In 2018, two ballot initiatives were circulated, one to change Michigan’s minimum wage laws, including minimum wage for tipped employees, and the other to change rates for accumulated paid sick time. Before the initiatives were put on the ballot, the Legislature passed ESTA and IWOWA. Shortly after that, in a lame-duck session, the Legislature amended both Acts. The amended Acts significantly overhauled the initial ballot initiatives. In May 2021, several groups brought a petition directly to the Court of Claims, challenging the constitutionality of the amended Acts. The Court agreed to hear the plea.
On July 19, 2022, the Michigan Court of Claims held that the “adopt and amend” strategy that the legislature used violated the Michigan Constitution....
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