Minimum wage increase for Michigan employees takes effect this month

Minimum wage will increase to $9.45 per hour

CNN Money

Michigan workers making minimum wage will get a slight raise in March.

Effective March 29, 2019, Michigan’s minimum wage will increase from $9.25 to $9.45 per hour. 

Overtime requirements remain the same under the Improved Workforce Opportunity Wage Act; non-exempt employees should be paid 1.5 times their regular rate of pay for hours worked over 40 in a 7-day work week.

Employees 16 to 19 years of age

An employer may continue to pay minors 16 to 17 years of age 85 percent of the minimum hourly wage rate. On March 29, 2019, that rate will increase from $7.86 to $8.03 per hour. There is no change to the training wage of $4.25 per hour that may be paid to newly hired employees, 16 to 19 years of age, for the first 90 days of their employment. 

Tipped employees

Public Act 337 of 2018 allows employers to take a tip credit on minimum wage under certain conditions for employees who customarily and regularly receive tips from a guest, patron or customer for services rendered to that guest, patron, or customer.

Tipped employees may be paid 38% of the minimum hourly wage rate, provided:

  • Employees are informed in advance of being paid about the tip provisions, and
  • Employees receive tips and they are proven gratuities as indicated by the employee's declaration for Federal Insurance Contribution Act, and
  • The tips received plus the wages paid equals or exceeds the minimum hourly wage rate and, if not, the employer pays the shortfall.

Effective March 29, 2019, 38 percent of the minimum hourly wage rate will increase from $3.52 to $3.59 per hour.

The increase is less than the $10 per hour proposed by the citizen-backed initiative in November. 

The Republican-led Michigan Legislature changed the bill after the Nov. election, reducing the proposed increase. The citizen ballot proposal called for a $12 minimum wage by 2022, which was pushed back by Republican lawmakers, to 2030. Gov. Rick Snyder signed the legislation in December. 

Snyder also signed another controversial measure that will mandate fewer hours of paid sick leave than the language originally approved for the ballot initiative -- 40 hours versus 72 hours in the original proposal, for companies with more than 50 employees.

The minimum wage will increase to $9.65 in 2020 and to $9.87 in 2021.

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