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Michigan Hikes Minimum Wage to $9.25 Per Hour

May 28, 2014

Yesterday, Michigan Governor Rick Snyder signed a bill increasing the minimum wage in Michigan gradually over the next four years from the current $7.40 per hour to $9.25 per hour. The first increase goes into effect on September 1, 2014, and increases the minimum wage to $8.15 per hour. A second increase goes into effect on January 1, 2016 that increases the minimum wage to $8.50 per hour, followed by a third increase at the beginning of 2017 to $8.90 per hour, and a final increase to $9.25 per hour at the beginning of 2018. After 2018, subsequent annual increases will occur tied to the current rate of inflation, provided the state unemployment rate does not exceed 8.5%. Any such increase is capped at 3.5% per year.

There are a number of other provisions in the new law about which employers in Michigan should be aware. For example, the bill permits an employer to pay a “training hourly wage” of $4.25 per hour to a new employee less than 20 years of age for the first ninety days of their employment. The minimum wage for employees under 18 years of age is lowered to 85% of the minimum wage in effect at the time (so, effective September 1, 2014, $6.93 per hour). Finally, effective September 1, 2014, tipped employees are eligible to receive an hourly wage of 38% of the state minimum wage ($3.10 per hour), an increase from the current minimum wage for tipped employees of $2.65 per hour.

For more information, please contact the author of this alert, James Hermon (313-568-6540; jhermon@dykema.com), any of the Labor & Employment attorneys listed to the left, or your Dykema relationship attorney.

As part of our service to you, we regularly compile short reports on new and interesting developments and the issues the developments raise. Please recognize that these reports do not constitute legal advice and that we do not attempt to cover all such developments. Rules of certain state supreme courts may consider this advertising and require us to advise you of such designation. Your comments are always welcome. © 2017 Dykema Gossett PLLC.