League opposes Michigan legislation weakening minimum wage, earned paid sick time

Rally at Cadillac Place state office building on April 22, 2021 to fight for minimum wage increase and paid sick leave. | Ken Coleman photo

The Michigan League for Public Policy is deeply concerned about legislation that has already passed out of the Michigan House, which undermines a recent ruling by the Michigan Supreme Court and seeks to weaken earned paid sick time and minimum wage protections for working Michiganders.

To provide some context on how we got here, it’s important to look back at where this began. 

In 2018, Michigan voters were unjustly blocked from having their say on popular earned paid sick time and minimum wage proposals, which were polling at over a 70% approval rating. To stop the proposals from appearing on the ballot, the 2018 Michigan Legislature instead adopted them ahead of the election and later gutted them during that year’s lame duck session. 

After a long, six-year legal battle, the Michigan Supreme Court ruled last year that this adopt-and-amend scheme was unconstitutional. With that ruling, Michigan’s minimum wage is slated to be raised to $12.48 this February and will continue to annually increase, reaching almost $15 by 2028. 

The tipped minimum wage will also be raised to $5.99 next month and will continue to annually increase until it is brought above the subminimum level in 2030. Additionally, all Michigan employers will be required to provide their employees either 40 or 72 hours of paid sick time each year, depending on the number of workers they employ.

Minimum wage and sick leave bills clear Michigan House with bipartisan support after heated debate

However, newly proposed legislation — House Bills 4001 and 4002  — is placing these urgently needed worker protections at risk of being significantly altered, yet again. 

These bills seek to reduce minimum wage increases over the next several years, resulting in a $1,000 to $2,400 annual pay cut for Michigan workers, while also maintaining subminimum tipped wages and exempting 96% of Michigan businesses — those with less than 50 employees — from providing paid sick time. 

HBs 4001 and 4002 would move Michigan in the wrong direction in terms of strengthening economic security for workers and their families, addressing pay inequities, and safeguarding our state’s public health. 

They come at a time when the majority of Michiganders, including both Democrats and Republicans, have said they support the minimum wage and paid sick leave changes set to take effect this February. They also come at a time when our state’s wages continue to lag behind the cost of living and public health continues to be jeopardized by a lack of basic paid sick time coverage for many workers. 

The COVID-19 pandemic truly underscored the importance of paid sick time for all. Without it, many employees must choose to either go without pay or go to work sick. The provisions slated to take effect this February will allow all Michigan workers to take time off when they are sick without fear of experiencing financial hardship, while also reducing the risk of contagious illnesses spreading in workplaces, schools and public spaces. 

However, if HB 4002 passes in the Michigan Senate, these essential protections will be stripped away from nearly 1.5 million working Michiganders, placing workers, families and the general public in harm’s way. 

Furthermore, Michigan’s minimum wage already falls far behind many other states, 17 of which have already passed a $15 minimum wage. These are not just states with large urban centers, but more rural states as well, such as Nebraska and Missouri. 

Currently, Michigan’s minimum wage is only $10.56 an hour. If HB 4001 passes in the Michigan Senate, it would not reach $15 for another four years. In comparison, the minimum wage schedule slated to go into effect this February will provide larger annual pay increases over the next several years and will get Michigan’s minimum wage to almost $15 sooner. 

As the cost of living continues to rise and looming federal cuts begin to harm household budgets, we need to be doing more, not less, to ensure Michigan workers and families are able to afford basic necessities, such as housing, food, utilities and healthcare. This includes the 41% of Michigan households that are already struggling to make ends meet.

Bringing tipped wages above the subminimum level is also critically important from both an economic security and equity standpoint. Contrary to what proponents of these bills have said, we only need to look to the seven states that have already established a single fair minimum wage to uncover strong evidence showing that tipped workers in these states have done as well as or better than tipped workers in states with subminimum tipped wages. 

And, given that Michigan currently has one of the widest gender wage gaps in the country and 74.3% of all tipped workers are women, the changes slated to take effect next month will go a long way in addressing ongoing pay inequities in our state, while ensuring all service industry workers receive more consistent wages that are not as contingent on the tips they make. 

This is especially important for tipped workers in smaller, rural communities where restaurants and bars may not have as large of a customer base as larger, urban communities. 

When workers are healthier, better paid and less stressed, businesses thrive, communities prosper and our state becomes a stronger and more equitable place for all. We hope to see the Michigan Supreme Court’s ruling upheld for the sake of workers, families, public health, local economies and our state as a whole.