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Governor Signs Amendments on Minimum Wage and Paid Sick Leave Mandates

Governor Signs Amendments on Minimum Wage and Paid Sick Leave Mandates

Gov. Rick Snyder signed into law changes to the minimum wage and paid sick leave initiatives last Friday. With the original legislation being extremely burdensome to Michigan’s business community, a coalition of Michigan job providers including the Small Business Association of Michigan formed “Small Business for a Better Michigan” to advise the legislature to make needed changes to the burdensome legislation.

Many of the recommendations from this coalition were included in the final draft that passed and made these two proposals workable for Michigan’s business community. Below are summaries of both the Minimum Wage and Paid Sick Leave legislation that have now been signed into law.

 

Minimum Wage –

The original proposal passed in September would have gradually raised the minimum wage to $12 an hour by 2022 and would eliminate the tipped wage so that tipped workers would be paid $12 an hour by 2024. After much discussion, the legislature decided to pass an amendment to this proposal which would push the minimum wage increase out so that it will gradually raise to $12.05 by 2030. Also included in this proposal; the legislature eliminated the minimum wage’s adjustment to the Consumer Price Index (CPI), as well as brought back the tipped credit that exists currently, but gradually raised tipped wage to $4.58/hour by 2030.

Click here for the full bill language.

 

Paid Sick Leave –

The Original Un-amended Proposal Included:

  • Requires a company to provide 72 hours of paid earned sick time (one hour of paid leave for every 30 hours worked)
  • Small businesses with fewer than 10 employees would have to provide 40 hours paid sick leave and up to 32 hours of unpaid sick leave
  • Only federal employees are exempt meaning all employers including state and local government, private, non-profits, churches, agriculture and more  will be required to comply with the policy
  • This legislation includes part-time employees
  • Sick leave can be used for a wide and potentially unrestricted list of reasons, including for care of any person related by blood “or affinity” – a vague regulatory term
  • No proof (i.e. doctors note) is required to take sick leave; liability lies with the employer
  • Does not require notice of employer prior to use of paid sick time
  • Empowers state bureaucrats with new investigatory and regulatory authority including civil penalties.

 

The Amended and Adopted Proposal Includes:

  • Requires a company to provide 40 hours of paid earned sick time (one hour of paid leave for every 35 hours worked, but maxed out a 1 hour of leave per week). It also allows businesses to front-load Paid Earned Sick time to avoid dealing with the accrual process internally.
  • Employees immediately accrue Paid Sick Leave hours, but cannot use that time until after 90 days of employment.
  • Exempt from this proposal – Employers with under 50 employees, seasonal employees, variable hour employees, part-time employees, Independent Contractors, high salary employees, employees covered by collective bargaining agreements, flight deck crews, and employees who primarily work outside of the state.
  • Sick leave can be used if the employee, their child, spouse, parent, grandparent, sibling, or grandchild is sick.
  • An eligible employee shall, when requesting to use paid medical leave, comply with his or her employer’s usual and customary notice, procedural, and documentation requirements for requesting leave. The employer must give an eligible employee at least 3 days to provide the employer with documentation.
  • There is a rebuttable presumption that an employer is in compliance with this act.

Click here for the full bill language.

 

 

As you can see, the newly adopted proposal is much easier to comply with as a small business and will be much less egregious to the small business community. Please note that this a summary of both proposals, and does not include all provisions that will need to be followed once enacted.

 

For more information and updates like this, join SBAM’s Grassroots Network. Any questions or comments, please contact Micah Babcock, Grassroots Coordinator and Policy Advisor at micah.babcock@sbam.org

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