On January 26, 2023, the Michigan Court of Appeals reversed the lower court decision that would have gone into effect on February 19, 2023. That decision, among other items, would have increased Michigan’s hourly minimum wage to $13.03 and would have greatly expanded the state’s paid sick leave requirements. The Court of Appeals decision means that employers do not have to make changes to their paid sick leave policies that were drafted in compliance with the Michigan Paid Sick Leave Act that went into effect in 2019. Further, businesses no longer have to scramble to adjust minimum wage rates for both tipped and non-tipped workers as required under the lower court decision. Michigan’s hourly minimum wage will remain at $10.10. The tipped minimum wage remains at $3.84 an hour. 

In the published opinion, the three-judge panel ruled that the Michigan Legislature had the constitutional authority in 2018 to adopt two petition initiatives and then amend their particular policies, instead of having the initiatives go to the ballot that November. The Court explained that the Michigan Constitution does not prohibit the Legislature from adopting laws that were initially brought forward by petition initiative and amending those laws within the same legislative session. 

This ruling will likely be appealed to the Michigan Supreme Court and we will continue to monitor the situation. But for now, Michigan employers can enjoy a sigh of relief as there is no need to update policies and procedures by the February 19, 2023 deadline initially set forth by the lower court.