Michigan employers will have to pay a minimum wage of at least $12 an hour and provide expanded sick leave rights to all employees starting February 19, 2023, since the Michigan Court of Claims said it would delay enforcement of a recent ruling that is currently being appealed. On July 19, the court held that the Michigan Legislature improperly usurped a voter initiative that was slated for the 2018 ballot – which led the court to reinstate the 2018 voter-initiated versions of the state’s minimum wage law and paid sick leave law. What actions led to this decision and what does it mean for employers?
State Legislature Adopted and Amended Initiatives
Two ballot initiatives – the Improved Workforce Opportunity Act (IWOWA) and the Earned Sick Time Act (ESTA) – secured enough signatures to go on the November 2018 ballot. Instead of letting the initiatives be voted on, however, the Michigan Legislature decided to adopt both initiatives as proposed. The legislature took this approach because, if the ballot initiatives were passed by the voters, they could only be amended or repealed by the voters or by three-fourths of the legislature.
The ballot initiative version of IWOWA raised the minimum wage to $12 an hour by 2022 with yearly increases thereafter based on inflation. ESTA provided all Michigan employees with 72 hours of annual leave for numerous types of absences. ESTA gave small businesses – with fewer than 10 employees – a small break by requiring that only the first 40...
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