Michigan employers will have at least six months to prepare for an increase to the state’s minimum wage and stronger paid sick leave requirements following a Friday court ruling that brought swift applause from restaurant owners.
Michigan Court of Claims Judge Douglas Shapiro ruled on July 19 that the GOP-led Legislature’s unprecedented “adopt and amend” strategy used in 2018 to water down ballot initiatives was unconstitutional.
As his order was set to take effect within 21 days, potentially bringing a swift hike in the minimum wage as well as earnings for tipped workers, Shapiro approved a stay on the ruling until Feb. 19 to give employers time to make operational changes.
Shapiro’s initial ruling was especially alarming to some business owners in the hospitality industry who operate with a tipped wage system. Minimum wage in Michigan is currently at $9.87 an hour and $3.75 an hour for tipped workers.
“Judge Shapiro’s decision to stay the implementation of his ruling until February has successfully prevented the immediate economic decimation of full-service restaurants, but it leaves a teetering industry unsure of its future and incapable of making informed decisions to regain stability,” Michigan Restaurant & Lodging Association President and CEO Justin Winslow said in a statement. “We are hopeful that the state of Michigan files for a full stay of Judge Shapiro’s ruling to the Court of Appeals and that ultimately a decision is reached that allows Michigan restaurants a reliable path toward full recovery which includes operating with a tip credit like 42 other states currently do.”
The initial ballot proposals called for increasing Michigan’s minimum wage to $12 an hour and requiring up to 72 hours of paid sick leave per year.
The Michigan Restaurant & Lodging Association estimated implementing wage hikes from Shapiro’s July 19 ruling would cause hospitality business owners a 156 percent labor cost inflation.
JW’s Food & Spirits owner Chris Weavers previously told MiBiz that she did not know how her Grand Haven business would be able to keep up after she already raised prices to keep up with inflation.
News coverage in the food/agribusiness section of MiBiz is made possible by advertising support from Dan Vos Construction Company. Dan Vos Construction strives to serve people and to enhance life, while maintaining long-term relationships with customers, sub-contractors and employees. This advertisement has no effect on editorial consideration in MiBiz.