Minimum Wage Law Summaries
Michigan, Minimum Wage Law Summaries
The Michigan Minimum Wage Law of 1964 is located in the Michigan Compiled Laws, Labor Code, at Chapter 408, Sections 408.381 to 408.398 (Michigan Statutes Ann., Secs. 17.255(1) et seq. ). The full text of the law is available beginning at Wages-Hours ¶23-41,001 .
DEFINITIONS
“Employer” means a person, firm, or corporation, including the state and its political subdivisions, agencies, and instrumentalities, and a person acting in the interest of the employer, that employs two or more employees at any one time within a calendar year. An employer will be subject to Michigan's minimum wage law during the remainder of that calendar year (Sec. 408.382, as amended by H. 4177, L. 1997).
“Employee” means an individual not less than 16 years of age employed by an employer on the employer's premises or at a fixed site designated by the employer, and includes a minor employed under the Youth Employment Standards Act (Sec. 408.382, as amended by H. 4177, L. 1997).
“Gratuities” means tips or voluntary monetary contributions received by an employee from a guest, patron, or customer for services rendered to that guest, patron or customer and that the employee reports to the employer for FICA purposes (Sec. 408.387a, as amended by S. 1, L. 1997).
COVERAGE
Michigan's minimum wage law covers most employees over the age of 16, with limited exceptions explained below, that work on the employer's premises. Minors are also covered. Public and private employers that employ two or more persons at any one time are covered employers (Sec. 408.382, as amended by H. 4177, L. 1997).
EXCEPTIONS
Michigan's minimum wage law does not apply to an employer that is subject to the minimum wage provisions of the federal Fair Labor Standards Act, except where the application of the federal minimum wage provisions would result in a lower minimum wage than provided by Michigan law. Each of the following applies to an employer who is subject to the state minimum wage law only by application of this subsection (Sec. 408.394(1), as amended by P.A. 373 (H. 6213), L. 2005, enacted September 22, 2006):
Sec. 408.384a does not apply.
The state minimum wage law does not apply to an employee who is exempt from the minimum wage requirements of the federal Fair Labor Standards Act of 1938.
Notwithstanding Sec. 408.394(1), an employee shall be paid in accordance with the minimum wage requirements of Sec. 408.384 below if the employee meets either of the following conditions (Sec. 408.394(2), as amended by P.A. 373 (H. 6213), L. 2005, enacted September 22, 2006):
Is employed in domestic service employment to provide companionship services for individuals who, because of age or infirmity, are unable to care for themselves and is not a live-in domestic service employee.
Is employed to provide child care, but is not a live-in domestic service employee.
Persons employed in summer camps for not more than four months and employees who are covered under Sec. 14 of the federal Fair Labor Standards Act are also exempt from the minimum wage law (Sec. 408.394(3), as amended by P.A. 373 (H. 6213), L. 2005, enacted September 22, 2006).
Michigan's minimum wage law does not apply to agricultural fruit growers, pickle growers and tomato growers, or other agricultural employers who traditionally contract for harvesting on a piecework basis, as to those employees used for harvesting, until the board has acquired sufficient data to determine an adequate basis to establish a scale of piecework and determines a scale equivalent to the prevailing minimum wage for that employment. The piece rate scale shall be equivalent to the minimum hourly wage in that, if the payment by unit of production is applied to a worker of average ability and diligence in harvesting a particular commodity, he or she receives an amount not less than the hourly minimum wage (Sec. 408.394(4), as amended by P.A. 373 (H. 6213), L. 2005, enacted September 22, 2006)
Notwithstanding any other provision of the minimum wage law, Sec. 408.394(1) and (2) do not deprive an employee or any class of employees of any right that existed on September 30, 2006, to be paid the minimum wage (Sec. 408.394(5), as amended by P.A. 373 (H. 6213), L. 2005, enacted September 22, 2006).
WHAT THE EMPLOYER MUST DO
The minimum wage is $7.40 per hour (Sec. 408.384, as amended by P.A. 81 (S. 318), L. 2005, enacted March 28, 2006).
Detroit “living wage” .- Detroit requires employers entering into or extending service contracts whose total expenditure exceeds $50,000 to pay full-and part-time employees an hourly wage rate that is equal to 125% of the federal poverty level or 100% of the federal poverty level if health benefits are provided. These rates are $10.60 per hour if health benefits are provided, and $13.25 per hour if health benefits are not provided, effective as of June 1, 2008. Employers awarded financial assistance from the city in excess of $50,000 must also pay this hourly wage rate (Detroit Living Wage Ordinance, effective December 16, 1998). Copies of the living wage ordinance are available from the City Clerk's Office, 200 Coleman A. Young Municipal Center, Detroit, MI 48226; telephone, (313) 224-2083.
Warren “living wage” .- Employers with city service contracts exceeding $50,000 or awarded city financial assistance in excess of $50,000 must pay a minimum wage equal to 125 percent of the federal poverty level for a family of four or 100 percent of the federal poverty level for a family of four (currently $8.50 an hour) if health benefits are provided.
Township of Ypsilanti “living wage” .- Companies receiving township service contracts or financial assistance over $10,000 in a 12-month period must pay employees who work under the contract or grant (as well as employees of their subcontractors or leaseholders) at least $8.50 per hour, or $10.00 per hour if no health benefits are provided (Ordinance No. 99-213, adopted May 4, 1999).
City of Ypsilanti “living wage” .- Every person that receives a service contract or financial assistance of $20,000 or more in a 12-month period from or through the City of Ypsilanti must pay a living wage to all persons who work on the contract or who work in (or whose base of employment is in) the workplace or location that receives the contract or assistance. The living wage is $10.00 per hour when health care is not provided, and $8.50 per hour when health care is provided (Ordinance No. 892, passed and adopted June 15, 1999, effective June 24, 1999).
Ferndale “living wage” .- All employees employed and work performed as part of a service contract with the city must receive an hourly wage no less than $8.50 per hour with health benefits, or otherwise $9.75 per hour if without health benefits. The wage will be adjusted on an annual basis beginning January 1, 2003, and each year thereafter in proportion to the Consumer Price Index for the Detroit Metropolitan Area, as published by the Bureau of Labor Statistics, U.S. Department of Labor (The City of Ferndale Code of Ordinances, Ch. 2, Art. VI, as added by Ordinance No. 933, adopted January 22, 2001).
Ann Arbor “living wage” .- Every contractor/vendor or grantee (see definitions below) must pay its covered employees a living wage as follows: (1) for a covered employer that provides employee health care to its employees, the living wage is $10.85 an hour, or the adjusted amount as described below; (2) for a covered employer that does not provide health care to its employees, the living wage is $12.56 an hour, or the adjusted amount described below. These listed rates are effective as of April 30, 2008.
The amount of the living wage will be adjusted upward each year by a percentage equal to the percentage increase, if any, in the federal poverty guidelines as published by the U.S. Dept. of Health and Human Services. Subsequent annual adjustments will be based on the percentage increase, if any, in the federal poverty guidelines when comparing the prior calendar year's poverty guidelines to the present calendar year's guidelines. Prior to April 1 of each calendar year, the city will notify any covered employer of this adjustment by posting a written notice in a prominent place in City Hall, and, in the case of a covered employer that has provided an address of record to the city, by a written letter to each such covered employer.
“Contractor/vendor” is a person or entity that has a contract with the city primarily for the furnishing of services where the total amount of the contract or contracts with the city exceeds $10,000 for any 12-month period.
“Grantee” means any form of financial assistance to a grantee (a person or entity that is a recipient of any financial assistance from the city in the form of any federal, state or local grant program administered by the city, revenue bond financing, tax increment financing, tax abatement, tax credit, direct grant, or any other form of financial assistance that exceeds $10,000 for any 12-month period (Code of the City of Ann Arbor, Title I, Ch. 23, effective March 21, 2001).
Eastpointe “living wage” .- Employers that contract with the city or that receive financial assistance from the city must pay their employees a wage sufficient to meet basic subsistence needs, defined as a “living wage.” “Living wage” means an hourly rate that on an annual basis (based on 40 hours per week, 50 weeks per year), is equivalent to either of the following (Ordinance No. 901, April 3, 2001):
125% of the federal poverty level; or
100% of the federal poverty level, if health care benefits are provided to the employee.
The 2008 living wage rate is $10.60 with health care benefits and $13.25 if the employee does not receive health care benefits. The 2009 living wage rate is $11.03 with health care benefits and $13.78 if the employee does not receive health care benefits.
Pittsfield Charter Township “living wage” .- Contractors/vendors and grantees of covered financial assistance that employ or contract with five or more individuals and that have not been granted exemptions must pay full-time employees a living wage as established below (Ordinance No. 247, effective April 12, 2001):
if health care is provided, the living wage will be at least $10.20 an hour, or the adjusted wage as described below.
if health care is not provided, the living wage will be at least $11.95 an hour, or the adjusted wage as described below.
The amount of the living wage will be adjusted upward annually by a percentage equal to the percentage increase, if any, in the federal poverty guidelines (Ordinance No. 247, effective April 12, 2001).
Monroe County “living wage” .- For-profit service contractors employing or contracting with five or more individuals and doing business with the county must pay covered employees a living wage of $8.70 an hour with health care benefits, or $10.20 an hour without health care benefits. The monetary threshold for covered contracts is $10,000 (October 9, 2001).
Washtenaw County “living wage” .- Certain Washtenaw County service contractors as well as the county must pay nonexempt employees a living wage as follows: for a covered employer that provides employee health care to its employees, the living wage is $10.48 an hour, and for a covered employer that does not provide health care to its employees, the living wage is $12.28 an hour. These rates are effective May 1, 2008 to April 30, 2009. The living wage is to be adjusted at least annually (Adopted October 17, 2001).
Southfield “living wage”.- Covered employers providing contractual services to the city or that receive a tax abatement from the city must pay their covered employees a living wage of $10.33 an hour if health care benefits are provided by the employer, or $12.91 an hour if health care benefits are not provided (Ordinance No. 1478, effective September 8, 2002).
Ingham County “living wage”.- Specified service contractors are required to pay their employees wages that are greater than or equal to a living wage. “Living wage” means an hourly wage rate equal to 125% of the federal poverty line on an annual basis when calculated based on 40 hours per week, 50 weeks per year; provided, however, that costs paid by the employer for an employee's health care benefits may be counted toward up to 20 percent of the hourly rate payable to the employee. The living wage rate is to be adjusted annually. The 2009 living wage rate is $13.78 per hour (Resolution #03-168).
Lansing “living wage.”- The Mayor of Lansing, Michigan, implemented a living wage for the city by executive order. At a minimum, a contractor who is a party to a contract with the city for services and certain grantees receiving economic development assistance from the city shall provide their employees a living wage rate of $13.25 per hour for 2008. The living wage for 2009 is calculated as $13.79 per hour. If the contractor or grantee pays health care benefits on behalf of the employee or the employee's dependents, this hourly obligation may be reduced accordingly. Inquiries and/or complaints regarding the living wage can be directed to City of Lansing, Human Relations and Community Service Department, 4th Floor City Hall, 124 W. Michigan Ave., Lansing, MI 48933 (Telephone: 517-483-4477).
Macomb County “living wage.”- The county shall not enter into any contract for services with any contractor who does not demonstrate that it pays its workforce a living wage. “Living wage” shall mean an hourly rate, which on an annual basis (based on 40 hours per week, 50 weeks per year) is equivalent to either of the following: (1) 125% of the federal poverty level; or (2) 100% of the federal poverty level, if health care benefits are provided to the employee.
Tipped employee credit.- The minimum hourly wage rate of an employee is $2.65 per hour if all of the following occur (Sec. 408.387a, as amended by S. 1, L. 1997):
the employee receives gratuities in the course of his or her employment;
the gratuities equal or exceed the difference between $2.65 per hour and the regular minimum hourly wage;
the gratuities are proven gratuities as indicated by the employee's declaration for FICA purposes;
the employee was informed by the employer of these provisions.
Subminimum wages.- An employer may pay a new employee who is less than 20 years of age a training hourly wage of $4.25 per hour for the first 90 days of employment. The training hourly wage is in lieu of the minimum hourly wage otherwise prescribed above. An employer may not displace an employee to hire an individual at the training hourly wage (Sec. 408.384b, as amended by P.A. 375 (S. 1364), L. 2005, enacted September 22, 2006).
Except as provided just above, the minimum hourly wage for an employee who is less than 18 years of age is 85% of the general state minimum hourly wage (Sec. 408.384b, as amended by P.A. 375 (S. 1364), L. 2005, enacted September 22, 2006). [Note: According to the Michigan Department of Energy, Labor and Economic Growth, the minimum hourly rate for youth under the age of 18 is $6.55 per hour effective July 24, 2008, and $7.25 per hour July 24, 2009; According to the Department, minors 16 and 17 years old may be paid 85 percent of the state minimum hourly rate unless the federal minimum hourly rate is greater than the state 85 percent rate, then the federal rate must be paid. From July 1, 2008, until July 23, 2008, the 85 percent rate of $6.29 per hour applied (Required Poster, General Requirements, The Michigan Minimum Wage Law of 1964, No. WHD-9904 (01/09) and Information Sheet No. WHD-9913 (01/09).]
On petition of a party in interest or on its own motion, the Director of the Department of Consumer and Industry Services will establish a suitable scale of rates for apprentices, learners, and persons with physical and mental disabilities who are clearly unable to meet normal production standards. The rates may be less than the regular minimum wage rate for experienced workers and workers without disabilities (Sec. 408.387, as amended by S. 1, L. 1997).
NOTICE
Every employer subject to Michigan's minimum wage law, regulations or orders must post copies of the law, regulations or orders in a conspicuous place in the area where employees are employed. The Director of the Department of Consumer and Industry Services will furnish copies of the minimum wage law, regulations, and orders to employers without charge (Sec. 408.391).
ENFORCEMENT
The Director of the Department of Consumer and Industry Services administers and enforces Michigan's minimum wage law (Sec. 408.392).
Investigatory authority.- At the request of the Wage Deviation Board, the director may investigate and ascertain the wages of employees of an employer subject to the minimum wage law (Sec. 408.392).
Confidential records.- The Director of the Department of Consumer and Industry Services and his or her employees will not reveal facts or information obtained in the course of official duties, except as when required by law, to report upon or take official action or testify in proceedings regarding the affairs of an employer covered by the minimum wage law (Sec. 408.392).
Court actions.- If the Director of the Department of Consumer and Industry Services determines there is reasonable cause to believe that an employer has violated Michigan's minimum wage law, and the director is subsequently unable to obtain voluntary compliance by the employer within a reasonable period of time, the director will bring a civil action for the recovery of the difference between the amount paid and the amount that, but for the violation, would have been paid the employee under Michigan's minimum wage law and an equal additional amount as liquidated damages, together with costs and reasonable attorney's fees. No contract or agreement between the employer and the employee or any acceptance of a lesser wage by the employee will bar the action (Sec. 408.393, as amended by S. 1, L. 1997).
Employee's remedies.- If an employer violates Michigan's minimum wage law, the affected employee, at any time within three years, may (1) bring a civil action for the recovery of the difference between the amount paid and the amount that, but for the violation, would have been paid the employee under Michigan's minimum wage law and an equal additional amount as liquidated damages, together with costs and reasonable attorney's fees; (2) file a claim with the director, who will investigate the claims (Sec. 408.393. as amended by S. 1, L. 1997).
WHO TO CONTACT
Wage and Hour Division, Michigan Department of Energy, Labor and Economic Growth, P.O. Box 30476, Lansing, MI 48909-7976. (The physical address for the division is 6546 Mercantile Way, Suite 5, Lansing, MI 48911). Telephone: (517) 335-0400. E-mail: WHINFO@MICHIGAN.GOV.
RECORDKEEPING
Every covered employer must furnish the employee a statement of the hours worked by the employee and of the wages paid, listing deductions made each pay period. The employer must also furnish the Director of the Department of Consumer and Industry Services, upon demand, a sworn statement of the records (Sec. 408.391).
Open records.- The records must be open to inspection by the director, a deputy or any authorized agent of the department at any reasonable time (Sec. 408.391).
POSTING
Every employer subject to Michigan's minimum wage law, regulations or orders must post copies of the law, regulations or orders in a conspicuous place in the area where employees are employed. The Director of the Department of Consumer and Industry Services will furnish copies of the minimum wage law, regulations, and orders to employers without charge (Sec. 408.391). See ¶23-9900 .
PENALTIES
Wage violations.- An employer who fails to pay the minimum hourly wage is subject to a civil fine of not more than $1,000 (Sec. 408.393, as amended by S. 1, L. 1997).
Other violations.- Any person that violates any provision of Michigan's minimum wage law, regulation or order is guilty of a misdemeanor (Sec. 408.395).
An employer who displaces an employee to hire an individual at the training hourly wage is subject to a civil fine of not more than $1,000 (Sec. 408.384b, as amended by P.A. 375 (S. 1364), L. 2005, enacted September 22, 2006).
Discrimination.- An employer that discharges or in any other manner discriminates against an employee because the employee has served or is about to serve on the Wage Deviation Board; or has testified or is about to testify before the board; or because the employer believes that the employee may serve on the board or may testify before the board or in any investigation under the provisions of the minimum wage law, is guilty of a misdemeanor (Sec. 408.395).
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