A Costly Unemployment Increase: Both the Michigan House and Senate recently voted for a costly increase to unemployment insurance, which now awaits the Governor’s signature.

The last time the weekly unemployment benefits exceeded $600 during the pandemic, the labor force participation fell and took until 2024 to fully recover. In addition to that, a recent Senate Fiscal Analysis indicated that SB 40 is estimated to add $635.6 million in annual costs to employers, which will be covered in the form of increased unemployment assessments. The Unemployment Trust Fund has not yet fully recovered from misuse and fraud during the pandemic and the agency is still in the early stages of modernizing the system to protect it from fraud and abuse. 

New Earned Sick Time and Minimum Wage Changes will ramp up costs and bring major compliance burdens for small businesses across the state. Please visit SBAM’s dedicated landing page to learn more about these new requirements.

Fix the Earned Sick Time Act: While some businesses have concerns about the mandated benefits set to take effect on February 21, 2025, our larger concerns center around implementation issues. Please visit our list of suggested commonsense changes to the Earned Sick Time Act that would ease implementation for employers and employees.

Restore the Tipped Wage Credit: Recent industry surveys show that perhaps 1 in 6 restaurants will close their doors forever and 40,000-60,000 restaurant jobs would be eliminated. Furthermore, servers overwhelmingly support the tipped wage system, which is not surprising, considering that servers, on average, make more than $25/hour. 

Oppose Workers’ Compensation Overhaul (SB 1079-1080): Badly needed reforms to the Workers’ Compensation system in 2011 took Michigan from being one of the most expensive states to one of the most competitive and effective. Since that time, rates have declined by 45% and premiums have been reduced by a cumulative $445 million. Proposed changes would create a system ripe for abuse, increase costs and reduce labor force participation.  

Oppose Paid Family Leave (MI FLOC) Mandate (SB 332-333 and HB 4574-4575): Small businesses are still reeling from the prospects of implementing the Earned Sick Time Act. Adding an additional mandate of 12-15 weeks in paid family leave will increase costs to both workers and small businesses, reduce labor force participation and create a massive new government bureaucracy in the style of the Unemployment Agency. A recent Senate Fiscal Analysis estimated that assessments on employers and employees to total a whopping $16-17.2 billion dollars per year if the benefit was set at 15 weeks. 

Oppose Local Preemption Repeal (HB 6218 / SB 1173 and HB 4237 / SB 171): This costly legislation would add extraordinary regulatory complexity, allowing over 1,800 local units of government to create their own laws concerning wages and employee benefits. This proposal would reduce jobs, discourage population and economic growth throughout the state, and create a confusing web of regulations and employment rules making it harder to operate a small business. 

Oppose Price Controls in Declared Emergency HB 5895-5897 (SB 954-956): This well-meaning legislation puts the state in a price setting position, subjecting small business owners to potential criminal penalties. The industries targeted by this legislation operate on very small margins and the threat of criminal prosecution when increasing prices is an unreasonable regulation given how little control small businesses retailers have over commodity prices. 

Oppose Consumer Protection Act Expansion (SB 1021-1022): This legislation would subject more than 80 industries, many of which are dominated by small businesses, to increased litigation and double regulation. Each of these industries are already subject to state licensing and oversight that carries authority to fine or even close businesses who engage in unlawful practices. The main beneficiaries of this proposal are trial lawyers, not consumers. 

Oppose Mandatory IRA Program (HB 5461): Small businesses are facing many new costs and regulations from the state and federal governments and this proposal adds an additional mandate on employers. A simple amendment to make participation voluntary would remove opposition. 

Oppose the Corporate Income Tax Increase (HB 6217): For decades Michigan had one of the most complex and uncompetitive business tax systems in the world. Since 2011, Michigan has had a simple and competitive corporate tax code. If the legislature is to consider road funding increase proposals, it should be based on user fees, not singling out businesses to cover the cost. 

Protect Independent Contractors (Oppose HB 4390): Small businesses often utilize independent contractors to fulfil important roles and tasks in their businesses, and many independent contractors are small businesses themselves. This bill would severely limit the use of contractors in everyday business and force most contractors into direct employment relationships. This simply does not make sense for most contractors and would severely limit their flexibility.  

Oppose a Ban on Noncompete Agreements (HB 4399): Many small businesses handle sensitive information or client relations and use restrictive covenants as a protection to their business. This bill would ban employers and employees from entering into such agreements, which protect their competitive business interests.  

Oppose Increased Penalties and Requirements for Wages and Benefits (HB 4402-4406): This package of bills presents a series of major problems for small businesses. These bills would drastically increase penalties for wage and fringe benefit violations. SBAM supports enforcing good employment practices, but these bills go as far as to threaten prison time for simple HR accounting errors. These bills also include various mandates that would force employers to reveal wage information and historical data to other employees.