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Michigan minimum wage increase set for January 1st, 2023

A person holds several $20 bills.
Igal Ness

Michigan’s minimum wage could go up twice next year.

The first increase will take place at the start of the year. That’s when the general minimum wage goes up to $10.10 an hour and the tipped minimum wage grows to $3.84 an hour, as part of a regularly scheduled annual increase.

The second is less certain. It would bump up the hourly minimum wage for many workers to $13.03 in February. Tipped workers would earn at least $11.73 an hour. But this further increase is at the center of a court battle.

“When you work full time, you should not live in poverty. We know what the cost of living is, and we need to value all work,” Dave Woodward, senior advisor to the One Fair Wage campaign, said of the second, potential increase. He pointed out the sizeable difference earning an extra few dollars per hour would have on an employee’s annual take-home salary.

The court battle over the $13-an-hour wage centers on an action by the Michigan Legislature in 2018. Lawmakers adopted a ballot measure backed by One Fair Wage into law before it went before voters. It laid out a schedule for wage increases. But after adopting the measure, the Legislature significantly weakened it later that same session in a practice known as “adopt and amend.”

A court ruled earlier this year that practice is unconstitutional and restored the law to its original form. The judge then stayed the effect of his decision until mid-February.

An appeals process is currently playing out, with arguments scheduled for December 13.

One Fair Wage president Saru Jayaraman said she expects the fight to rise past the Michigan Court of Appeals to the state Supreme Court.

“We are very confident that the law is so clear on this … that ultimately the Michigan Supreme Court will agree that what was done in 2018 is unconstitutional,” she said.

The adopt and amend ruling also impacted a proposal to change how workers accrue paid sick days.

While workers’ advocates are celebrating the court’s decision to restore the 2018 laws to their original form, some businesses are growing concerned about the impact the wage increase will have.

Wendy Block is the vice president of business advocacy and member engagement for the Michigan Chamber of Commerce.

“It would essentially overnight skyrocket the raise that is required under state law. It would also increase significant new mandates on employers in terms of their leave policies and really have a very detrimental effect on certain industries across Michigan,” Block said.

She argued a tight labor market and existing minimum wage laws make pay in Michigan higher than other states.

The court issued the stay delaying the ruling's effect to give employers and the state time to adjust to the new policy. It’s scheduled to lift on February 19.

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