The Michigan Legislature significantly amended two recently enacted laws. The first raises the state’s minimum wage. The second requires certain employers to provide their employees with paid medical leave. As many speculated when it chose to pass the two ballot initiatives in September, the outgoing Legislature used the lame duck session to revise these laws and make them less burdensome on Michigan employers. Governor Snyder signed the revised laws. They will take effect 90 days after the current Legislative session ends (sometime between March 20 and April 1, 2019).
The new minimum wage law raises the minimum wage to $9.45 per hour in 2019. The minimum wage rate will increase every January 1 thereafter until it reaches $12.05 in 2030. The new law provides a wage increase for tipped workers. Tipped employees who currently make $3.52 will see their pay rise to $3.59 in 2019, and to $4.58 per hour by 2030.
The new Paid Medical Leave Act (PMLA) applies only to employers who have at least 50 employees. The law also excludes from coverage salaried exempt, temporary, seasonal, part-time (working fewer than 25 hours per week) and private-sector union employees.
Under the PMLA, eligible employees must accrue one hour of paid medical leave per 35 hours worked. The PMLA limits the amount of paid medical leave that can be used in a year to 40 hours (unless the employer chooses to allow more). Employers can comply with the law by frontloading 40 hours of paid medical leave or paid time off each year. In addition, the law requires employers to provide paid medical leave in one hour increments. However, an employer may set a different increment of time if documented in an employee handbook or benefit manual.
The new laws are not without controversy. MI Time to Care is the group that organized the original petition campaign for paid sick leave. It has threatened litigation and to put the original version of the law back on the ballot in 2020.
If you have any questions about either of these laws, please contact any member of Warner + ’s Labor and Employment Practice Group.