Global Compliance Desk – Michigan
Michigan: Upcoming Amendment to Sick Leave Law
On July 31, 2024, the Michigan Supreme Court reinstated the 2018 version of the Earned Sick Time Act (ESTA) which is expected to take effect on February 21, 2025. This amendment shall be significant for Michigan employers as it expands the paid sick leave available to eligible employees by reinstating the earlier entitlement.
Increase in the Scope of Earned Sick Leave Entitlement
Currently, under the Michigan Paid Medical Leave Act of 2019, Michigan employers with 50 or more employees are required to provide non-exempt employees with paid sick leave accrued at a rate of 1 hour for every 35 actual hours worked.
Effective February 21, 2025, all Michigan employers (regardless of the number of employees) will be entitled to accrued paid sick leave at a rate of 1 hour for every 35 actual hours worked.
Accrual Limit of Earned Sick Leave
Currently, under the Michigan Paid Medical Leave Act of 2019, a non-exempt employee is entitled to accrue 40 hours of paid sick leave in a benefit year. A non-exempt employee can carryover up to 40 hours of accrued paid sick leave from one benefit year to the next, however, employers are not required to permit employees to use more than 40 hours of accrued leave in a single benefit year.
A benefit year is any consecutive 12-month period used by an employer to calculate an eligible employee’s benefits.
Effective February 21, 2025, all employees are entitled to accrue up to 72 hours in a benefit year. The sick leave law will apply to all employees and not just non-exempt employees.
Take Away – Employers must take proactive steps to comply with the amendments before February 21, 2025. They must review and potentially revise their policies to align with the upcoming changes to the existing sick leave requirements. However, there are still uncertainties about the implementation of the new law, such as whether frontloading sick leave will be allowed, how alternative leave policies might affect carryover, and the potential impact of a private right of action, etc., which will be clear once the law takes effect.
