The minimum wage in Michigan currently sits at $9.65/hr, which runs $2.40 higher than the federal rate. That number has been steadily rising but recently hit a bump in the road.
Michigan’s Then and Now
Michigan was once home to both the American dream and automobile. Since its illustrious beginnings, the state has encountered its fair share of challenges, but the minimum wage is rising again. The state legislated modest yearly wage increases in 2014 to bring the standard from $7.40 to $12.00 by 2030.
It’s an ambitious goal for Michigan as the state grapples with one financial crisis after another, the most recent being Covid-19 restrictions that closed businesses and kept customers at home. The pandemic left its mark on the country’s landscape, but Michigan planned for just such an event.
Future of Minimum Wage in Michigan
Unemployment skyrocketed last year, with 2020’s second quarter hitting 20 percent, triggering a ‘failsafe’ provision. According to the Workforce Opportunity Wage Act of 2018, an unemployment rate of 8.5 percent or higher prevents the scheduled hourly rate increase for the following year. This legislative circuit breaker means the wage hike to $9.87 suggested this year will not be seen until January 2022, provided the economy sufficiently recovers.
Michigan Workers – Same but Different
Like other states, Michigan’s minimum wage differentiates between certain kinds of workers. Those working in tipped professions make $3.67, which works out to be 38 percent of the full rate. There are rules about how businesses can pay service employees, but the gist is that tips and hourly pay must meet the total minimum wage threshold. This rate will rise as its counterpart rises.
The state further separates workers by age. Youth workers up to 17 years of age are paid only 85 percent of the standard minimum wage. Additionally, employees between 18 – 19 years old can be classified as ‘trainees’ and given a subminimum compensation. This trainee grouping can translate into $4.25 an hour for workers during the first 90 days.
There are also differing pay structures for employees with disabilities, apprentices, and ‘learners.’ If an employer is trying to pay someone subminimum wages, there are usually specific conditions for these rates to apply.
Need Help with Your Minimum Wage Questions?
If you’re unsure that your employer is paying you a fair wage, Michigan’s Department of Labor and Economic Opportunity might be the best place to start. There, you can get a good overview from their minimum wage brochure attachment, a more detailed look at the laws on the site, or fill out a wage and benefit claim form.
Additionally, Michigan’s Helping Hand site has several resources for jobs and training, unemployment, health, family support, and other programs that can help if you’re in a bind. It’s designed to reduce barriers and connect residents with the services they need without unnecessary complexity.
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Photo by Brett Jordan on Unsplash
Lindsey is a freelance writer in the personal finance and lifestyle sphere. When she’s not at her laptop, she is likely teaching herself a new hobby with a high potential for injury – such as skiing or cooking. Connect with her on LinkedIn and Twitter.
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