On January 1, 2023, Michigan’s minimum wage rate will increase from $9.87 to $10.10 per hour as set by Michigan’s Improved Workforce Opportunity Wage Act of 2018 establishing the annual schedule of increases.
Effective January 1, 2023:
- The minimum hourly wage will increase to $10.10 per hour.
- The 85% rate for minors aged 16 and 17 will increase to $8.59 per hour.
- The tipped employee rate of hourly pay increases to $3.84 per hour.
- The training wage of $4.25 per hour for newly hired employees ages 16 to 19 for their first 90 days of employment remains unchanged.
There is pending litigation that might affect this minimum wage increase:
In 2018, a petition initiative organized by One Fair Wage sought to allow voters to decide on raising Michigan’s minimum wage to $12 an hour by 2022 and raise the minimum wage for tipped workers to 80% of the standard minimum wage in 2022, 90% in 2023 and ultimately match it in 2024.
NFIB working with the Legislature adopted the legislation and then amended it in 2018, putting in lower wage thresholds that increased the minimum wage to $12.05 by 2030 instead of 2022 and kept the tipped minimum wage at 38% of the standard one. As a result, the state’s current hourly minimum wage is $9.87 and $3.75 for workers who are expected to make up the difference in tips.
The Legislature’s amendment has been challenged in court as unconstitutional. On July 19, 2022, the Court of Claims issued a decision that agreed with that challenge and voided the amended versions of the Michigan Improved Workforce Opportunity Wage Act and Paid Medical Leave Act in favor of their original, unamended versions.
On July 29, 2022, the Court of Claims entered an order staying the effect of this decision until February 19, 2023, to give employers and the relevant state agencies time to accommodate the changes required by the ruling.
The Court of Claims’ ruling was appealed with NFIB filing an amicus brief along with several other business organizations. The case was heard by the Appeals Court on December 13, 2022, and a decision is expected by the end of January. The case is expected to be appealed to the Supreme Court no matter what the decision from the Appeals Court.
If the Appeals Court upholds the Court of Claims decision, we will ask to continue the stay until the case makes it through the legal process. That would mean that things will stay status quo for the time being. NFIB has remained closely involved in the court case and will continue to update our members on any decisions or changes.
