Treasury Projects $14.97-An-Hour Minimum Wage By 2028; Seeks Supreme Court Clarification
August 27, 2024
Michigan’s $10.33 per hour minimum wage would increase by $2.15 next year and reach $14.97 in 2028 under the Department of Treasury’s interpretation of a recent Michigan Supreme Court ruling.
The adjustments were included in the Attorney General’s office brief seeking clarification on the Michigan Supreme Court’s July ruling that the 2018 Republican-led Legislature could not adopt and amend ballot initiatives related to the minimum wage and paid sick leave in the same session.
The AG’s office said the court provided July 31 as an end date for calculating inflation, but did “not clearly provide the beginning date.”
“Given the unprecedented situation created by reviving the Wage Act six years later, the State, employers and employees all need clear guidance from this Court on the proper methodology for calculating the minimum wage,” the brief filed on behalf of Attorney General Dana Nessel reads.
The AG’s office wants a decision before Sept. 15 as the deadline for the Michigan Department of Treasury to calculate and publish inflation rates in accordance with 2018 Public Act 337 is Nov. 1.
The Supreme Court held the original proposal would go into effect Feb. 21 and the state should adjust the numbers to take inflation into account.
If the court doesn’t clarify as requested, the Treasury department intends to bring the statutory minimum wages current to July 31, 2024, through an inflationary catch-up beginning Jan. 1, 2019, according to the court filing.
That means the current $10.33 per hour wage jumps to $12.48 in 2025, $13.29 in 2026, $14.16 in 2027, and $14.97 in 2028, according to the AG’s filing.
The AG’s office said clarification is needed on how to calculate the inflation rate from 2025 through 2028 and the meaning of the term “credit.”
The office also seeks clarification on whether the court intended to “exclude the 90 percent graduated increase for tipped wages and the effective dates for each year’s wage increases beginning in 2026.
In the motion, the AG’s office provides alternatives for adjusting the wages for 2025 through 2028 as follows:
- Looking back 12 months before July 31;
- Strictly apply Section 4(2) assuming a year-over-year inflation analysis beginning September 2021;
- Strictly apply Section 4(2) assuming a 12-month averaging analysis; and
- Apply a rolling start year for each of the years and enumerate wages set forth in the Wage Act while maintaining a July 31 end date.
In 2018, activists circulated a citizens’ initiative on a $12-an-hour minimum wage proposal and a paid sick time petition, but neither petition saw a statewide vote as the Legislature adopted the initiative and then moved after Election Day to change the laws with a simple majority.
Article courtesy MIRS News for SBAM’s Lansing Watchdog newsletter
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