In order to reach a consensus on two rules that would limit changes to the state’s minimum wage and paid sick leave policies that were scheduled to go into effect the next day, the Michigan Legislature worked late into Thursday night in the face of a tight midnight deadline.
Both the Democratic-led Senate and the Republican-led House presented their own plans at the start of the year to change the new sick leave regulations and keep the state’s tipped wage. Ultimately, they came to an agreement with Senate Bill 8 and House Bill 4002, removing a number of obstacles that might have prevented either policy from becoming law.
House Bill 4002, which addressed earned sick leave, was not given to Democratic Governor Gretchen Whitmer until 1:30 a.m. Friday, past the midnight deadline, despite the fact that both bills were sent to her with the hope of a signing. It’s unclear how that will affect the legislation.
In the absence of legislative action, the tipped wage would be phased away by 2030 and the minimum wage would rise to $12.48 on Friday, eventually reaching $14.97 by 2028. Businesses with 10 or more employees must provide 72 hours of paid sick leave annually, while those with fewer than 10 employees must provide up to 40 hours of paid sick leave and 32 hours of unpaid leave accrued over the year.
In July 2024, the Michigan Supreme Court issued a mandate establishing the new regulations. According to the Court’s ruling, members of the Republican-led Legislature in 2018 violated the Constitution by adopting two ballot proposals: one that would have increased the minimum wage and abolished the lower-than-minimum tipped wage rate, and another that would have established new paid sick leave requirements for employers. They also amended both proposals to remove important provisions.
With leaders of the restaurant and hospitality industry predicting that the new laws would close one in five eateries and result in the layoff of 40,000–60,000 restaurant workers, servers and business owners have blasted the court-ordered modifications.
However, on Wednesday, members of the House decided to return Senate Bill 8 to the Senate, allowing Democrats and Republicans to compromise.
Instead of phasing out the tipped minimum wage, the proposal, which was introduced by State Senator Kevin Hertel (D-St. Clair Shores), would raise it from 38% to 50% by 2031 and raise the state minimum wage to $15 by 2027.
However, for the policy to go into force right away, it had to pass a close vote.
To give the bill immediate effect, 25 votes from the chamber’s 37 members were required. Although 26 senators finally voted in favor of giving the bill immediate effect, its future appeared questionable when it only had 20 senators voting in support of it when it left the Senate last Thursday.
Sen. Kevin Daley (R-Lum), Ed McBroom (R-Vulcan), and Rick Outman (R-Six Lakes) were excused from last week’s vote, but Sens. Sarah Anthony (D-Lansing), Jon Bumstead (R-North Muskegon), John Cherry (D-Flint), and Mallory McMorrow (D-Royal Oak), who had previously voted against the effort, were among those in favor of immediate effect.
Senate members also have to agree on House Bill 4002, which would amend the Earned Sick Time Act, after giving Senate Bill 8 immediate effect. Because the bills are tied together, only one of the policies can become effective.
While the Senate’s own sick leave proposal, Senate Bill 15, would have permitted companies with fewer than 25 employees to offer 40 hours of sick leave and 32 hours of unpaid leave instead of 72 hours of paid sick leave, the original version of House Bill 4002 would have excluded companies with fewer than 50 employees from the new sick leave requirements.
Representative Jay DeBoyer (R-Clay Twp.) is the sponsor of House Bill 4002, which, in its ultimate form, mandates that companies give their workers one hour of paid earned sick leave for every thirty hours worked. Instead, small businesses—defined as those with 10 or fewer employees—would be exempt from the rule until October 1 and might choose to offer their staff 40 hours of paid sick leave at the start of the year.
For three years following the employment of their first employee, new companies that have not yet hired an employee prior to House Bill 4002 going into effect would likewise be excluded from the new rule.
At the start of the year, employers with more than ten workers are also permitted to give their staff members 72 hours of paid earned sick leave for immediate use.
Employers who have part-time workers may also give them time off at the start of the year as long as they let them know how many hours they should work in a year and give them time off equivalent to what they would receive if they put in all the required hours. They will earn more sick days if they exceed that quota.
enterprises with more than 10 employees are required to allow their employees to carry over 72 hours of sick leave, while small enterprises are required to allow their employees to carry over at least 40 hours from one year to the next.
Employers who give their employees paid time off at the start of the year are not obligated to allow their employees to carry over sick time to the next year, however they can if they set a larger allowance.
Additionally, the measure removes provisions that permit workers to file a civil lawsuit against their employer for breaking the law and permits businesses to discipline workers who take sick leave for illegal reasons or without providing adequate notice.
For meetings at a child’s school or place of care related to a child’s health, disability, or the effects of domestic violence or sexual assault on a family member, employees may use paid sick leave to attend to their own or a family member’s physical or mental health needs.
In addition, survivors of sexual assault or domestic abuse, as well as family members who care for them, can use sick leave to receive psychological or medical treatment, victim services, legal assistance, relocation due to domestic violence, or any legal services.
It can also be used to care for a child or family member whose school or place of employment is closed due to a public health emergency, if the employee’s workplace is closed due to a public health emergency, or if a health provider or health authorities have determined that the employee’s or a family member’s presence poses a risk of spreading an infectious disease to others.
The final version of House Bill 4002 requires employees to give notice as soon as possible, unless employers give their employees a written policy on how to provide notice for unexpected sick time. This, despite the fact that opponents of the court-mandated sick leave changes claimed it would allow employees to no-call no-show for three days without facing any repercussions.
With 26 votes in favor and 10 against, the Senate decided to send the modified House Bill 4002 back to the House shortly after 10:40 p.m.
Along with Senate Majority Floor Leader Sam Singh (D-East Lansing), Senate Majority Leader Winnie Brinks (D-Grand Rapids), Hertel, and Senators Veronica Klinefelt (D-Eastepointe), Sean McCann (D-Kalamazoo), Jeremy Moss (D-Southfield), Dayna Polehanki (D-Livonia), and Paul Wojno (D-Warren), the bill was fully supported by Republicans.
After passing the Senate, the House considered the issue and voted in favor of it 89–21.
According to Brinks, Michigan will have one of the most robust sick leave laws in the country under House Bill 4002. Singh pointed out that no other state requires enterprises with more than ten employees to take 72 hours of paid sick leave, with the closest laws being 56 hours.
In response to a question about if there were any worries about the governor signing the bills before midnight, Singh stated that Whitmer’s team was aware of the discussions that had taken place over the previous few days but that he would let her make the final decisions.
Senate Minority Leader Aric Nesbitt (R-Porter Twp.) continued to criticize the chamber’s Democratic majority, even though the agreement reached between the House and the Senate was preferable to the current situation.
Republicans have been demanding action since August, and it’s regrettable that Senate Democrats waited until the last minute to pass some legislation that will help save tens of thousands of restaurant jobs in the state, Nesbitt said, much like college students do when they have to finish their research paper.Since most Republicans supported a compromise while only a small percentage of Democrats did, our Republicans once again took the lead in both the House and the Senate, Nesbitt said.
Out of the 19 Democratic lawmakers in office, just eight of them supported each of the legislation.
But, despite the victories Republicans were able to achieve with this package, Nesbitt stated that it is not about Republicans and Democrats.
The focus is on working families. It concerns our little enterprises. The goal is to expand our economy. Nesbitt, who declared last month that he is running for the GOP nominee for governor in 2026, said, “This isn’t perfect, but it’s a lot better than what would have been enacted at 12:01 tomorrow morning.”
Michigan House Speaker Matt Hall (R-Richland Twp.) emphasized the significance of reaching an agreement on minimum wage and sick leave rules during a press conference earlier in the day on Thursday.
Because people are going to lose their jobs and small businesses are going to close, this is extremely important for every worker in Michigan as well as every small business that comes to the center and makes a transaction here. According to Hall, there will be a lot of restaurants closing, employees maybe losing their jobs, and their pay being reduced.
Our state will be in complete disaster if we are unable to reach an agreement. Some of these employers have no idea what their employees will be paid tomorrow. There will be complete turmoil since some of these smaller businesses aren’t prepared for the new legal changes that will go into force tomorrow, he said.
The deal was the first trial balloon of the state’s divided government, according to State Representative Bill G. Schuette (R-Midland), who chaired the House Select Committee on Protecting Michigan Employees and Small Businesses that handled the House’s tipped wage and paid sick leave proposals. The Republicans had won a 58-52 majority in the previous election.
According to DeBoyer, the agreement was a result of Hall’s leadership and the House Republican caucus’s approach.If you listen carefully, this is how we will continue to uphold the things that are important to Michigan residents over the next two years. Therefore, this is only a first step, and I believe that this behavior will continue, DeBoyer stated.
A national organization that represents workers in restaurants and service industries has announced its intention to offer a referendum on the bill, which might present another obstacle to the minimum wage changes while they wait for the governor to take action.
One Fair Wage issued a statement denouncing the Legislature’s attempts to reverse the tipped wage and the minimum wage set by the Supreme Court.
According to Saru Jayaraman, president of One Fair pay, politicians are trying to reverse the pay hikes before they even go into effect, despite the Michigan Supreme Court’s decision that they should be enacted. We re mobilizing to ensure voters not politicians have the ultimate say in whether these protections are upheld.
By collecting signatures from voters, citizens can contest recently passed laws through the state’s referendum procedure. If One Fair Wage s volunteers gather 223,099 signatures, the law would be suspended and placed on the ballot, where voters will determine whether or not it takes effect.
Staff Reporter Anna Liz Nichols contributed to this report.
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Eliot Pierce is a dedicated writer for ChiefsFocus.com, covering local crime and finance news. With a keen eye for detail and a passion for storytelling, Eliot aims to provide his readers with clear and insightful analysis, helping them navigate the complexities of their financial lives while staying informed about important local events. His commitment to delivering accurate and engaging content makes him a valuable resource for the community.