Michigan Supreme Court Clarifies Minimum Wage Decision

The Michigan Supreme Court’s July 31 opinion in Mothering Justice v. Attorney General sparked a host of questions about existing sick leave policies, the minimum wage, and the future of the “tipped employee credit,” among others.

On Sept 18, the state’s high court clarified aspects of its opinion regarding the minimum wage.

First, the Supreme Court clarified the schedule for increasing the minimum wage and phasing out the credit for tipped workers. Beginning Feb. 21, the minimum hourly wage will be $10.00 plus the state treasurer’s inflation adjustment, with July 31, 2024 serving as the endpoint for that calculation. Meanwhile the tipped workers’ minimum wage will increase to 48% of the general minimum wage. By Feb. 21, 2030, the phase-in schedule contemplated by the Wage Act will be complete, and tipped employees must be paid 100% of the general minimum wage by that time.

Second, in response to questions by the Michigan Attorney General and Gov. Gretchen Whitmer’s administration, the Supreme Court clarified that adjustments to the minimum wage and applicable percentages for tipped workers will occur on February 21st of each year—not January 1st—beginning in 2025 and concluding in 2030.

Finally, concerning the inflation adjustments necessary for determining the minimum wage set to take effect on Feb. 21, 2025, the court confirmed that the inflationary period to consider is Jan. 1, 2019 through July 31, 2024. The high court reiterated that the state treasurer has until Nov. 1, 2024 to complete that assessment.

Meanwhile, with February 2025 on the horizon, lawmakers have introduced a bill (Senate Bill No. 991) that, if enacted, would considerably scale back the wage increases set to take effect while maintaining the tipped worker credit. On Sept. 11, 2024, that bill was referred to the Senate Committee on Labor, where attorneys from Plunkett Cooney will continue to monitor its progress.

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