In this week’s issue of Warner Employment News From the Law Shanty, Steve Palazzolo discusses the Michigan Court of Claims' opinion and order that voids the 2018 amendments to the Earned Sick Time Act and Improved Workforce Opportunity Wage Act and reinstates both laws as they were originally adopted in 2018.
As a reminder, these laws began as ballot initiatives to require paid sick leave and higher minimum wages and were proposed for the November 2018 ballot. After gathering the requisite number of signatures, the proposals were submitted to the legislature to adopt or reject them, or propose alternatives to be placed on the ballot. The legislature adopted both laws on September 5, 2018, but then amended them during the same legislative session (the so-called “adopt and amend” strategy). The amended laws significantly reduced the paid sick leave and minimum wage requirements in the ballot initiatives. Employee advocacy groups quickly challenged the constitutionality of this adopt-and-amend strategy. On Tuesday, the Court of Claims concluded that the adopt-and-amend strategy was unconstitutional. It voided the amended laws and reinstated the Earned Sick Time Act and Improved Workforce Opportunity Wage Act as they were originally presented and adopted.
If this constitutional quagmire is not appealed, or if the Court of Clams' decision is affirmed on appeal, this ruling will have significant implications for employers. For example, the Earned Sick Time Act (unlike the now-voided Paid Medical Leave Act) applies to all Michigan employers (not just those with 50+ employees), and requires up to 72 hours (rather than only 40) of sick leave per year. Thus, larger employers will have to offer more paid sick leave time than they previously may have, and smaller employers who did not provide paid sick leave will now have to start offering it. The Improved Workforce Opportunity Wage Act, on the other hand, imposes a $12 minimum wage as of January 1, 2022 (compared to $9.87 under the now-voided amended law), and requires tipped workers to receive at least 80% of that wage, with the tip credit to be completely eliminated in 2024.
Warner will continue to monitor the situation as it unfolds. We also will host a webinar on this topic, titled “A Return to the Earned Sick Time Act and Improved Workforce Opportunity Wage Act as Originally Adopted” on July 27, 2022, from 1:00 – 2:00 p.m. We will send out an invitation to the webinar in the coming days and we hope you will attend.
To learn more about the Michigan Court of Claims’ opinion and order, click on the link below to view the video.
Look for additional Warner recordings in the near future from Steve Palazzolo’s podcast “Warner Employment News From the Law Shanty.”
Earned Sick Time and Minimum Wage are Back
