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Publications | January 26, 2023
2 minute read

The Earned Sick Time Act and Increase to Minimum Wage are Gone (for Now)

In a 3 – 0 ruling with two concurring opinions, the Michigan Court of Appeals today issued an opinion that reverses an earlier decision of the Michigan Court of Claims which had reinstated the original Improved Workforce Opportunity Wage Act (IWOWA) and Earned Sick Time Act (ESTA) adopted in 2018. The Court of Appeals disagreed with the ruling from the Court of Claims and held that the prior amendments to those laws are constitutionally valid and gave its decision immediate effect. The court ruled that the so called “adopt and amend” strategy used by the Michigan legislature to amend the original ballot initiatives is constitutional and within the powers vested in the legislature. The majority opinion provided an extensive analysis of its ruling including quoting from the transcripts of the legislative debate on the Michigan Constitution.

What this means for employers is that the Paid Medical Leave Act (as it is now called) and IWOWA provisions in effect last year will remain in effect pending further action by the Michigan Supreme Court or the legislature. If the Court of Appeals decision is appealed to the Michigan Supreme Court, and it decides to hear the appeal, that court is unlikely to issue a decision before next year. At least for now, any plans to change your sick time policies can be put on hold.

Warner’s Appellate and Supreme Court Practice Group represented the Michigan Manufacturers Association in the Court of Appeals as an amicus party advocating for the Court of Claims to be reversed, and our appellate group will continue to communicate major developments as they occur in the appellate courts.

If you would like to hear more about this opinion, watch attorney Steve Palazzolo’s podcast “Warner Employment News from the Law Shanty” below to get his take on the Court of Appeals ruling and what it means for employers.

If you have questions, please contact a member of Warner’s Appellate and Supreme Court Practice Group or Labor and Employment Practice Group.

ESTA Is Gone (for Now)