Your hardworking team at SBAM, bolstered by your faithful answers to our calls to action have resulted in desperately needed changes to the Earned Sick Time Act and the passage of legislation preserving the tipped wage system for bars and restaurants.
Important ESTA Updates

Small Business Owner Guide to New Minimum Wage and Paid Sick Leave Requirements
As of February 21, 2025 ALL businesses operating in the State of Michigan will be subject to new minimum wage and paid sick leave requirements. Businesses with 1-10 employees must comply with the Earned Sick Time Act by October 1, 2025; businesses with 11+ employees must comply as of February 21, 2025.
ALL businesses are required to nofify employees of ESTA entitlements by March 23, 2025.
SBAM has curated the Earned Sick Time Act Toolkit, a comprehensive set of customizable policies, worksheets, and more.
New Rules for Michigan Small Businesses
As of February 21, 2025, small businesses operating in the State of Michigan are be subject to new rules on minimum wage, paid sick leave, and tipped wage.

Minimum Wage Increase
New minimum wage schedule
Minimum Wage | Tip Wage % | Tip Wage | |
February 21, 2025 | $12.48 | 38% | $4.74 |
January 1, 2026 | $13.73 | 40% | $5.49 |
January 1, 2027 | $15.00 | 42% | $6.30 |
January 1, 2028 | $15.00 + CPI | 44% | – |
January 1, 2029 | CPI | 46% | – |
January 1, 2030 | CPI | 48% | – |
January 1, 2031 | CPI | 50% | – |

New Accrual Based Sick Leave Requirements
This decision from the Court requires all employers, including those with fewer than 50 employees, to offer paid sick leave to all employees, including part-time. It will require nearly every employer to make changes to the way they accrue sick time.
UPDATE: The Governor has signed HB 4002 on February 21, 2025, impacting the Earned Sick Time Act implementation.
Additional Resources
On-Demand Webinars & Briefings

ESTA FAQs
Please note – this will take you to a separate page where your member login will be required to view the webinar. It’s at the bottom of the web page. Available only to SBAM’s Basic, Premium, VIP and Elite members.

ESTA Compliance Webinar
Please note – this will take you to a separate page where your member login will be required to view the webinar. It’s at the bottom of the web page. Available only to SBAM’s Basic, Premium, VIP and Elite members.
Media Coverage
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- Detroit News
- Crains GR
- Bridge MI – What to know about Michigan’s pending minimum wage changes
- Capitol Confidential – Walth creators stung by Michigan minimum wage ruling
- Mlive – Michigan’s minimum wage will top $12 next year as high court reinstates 2018 ballot initiatives
- TV 6 (UP) – Michigan Supreme Court ruling to raise minimum wage
- Michigan workers to see new sick time requirements next year
- Created Equal: How Michigan Supreme Court’s ruling on minimum wage, sick leave will affect workers and businesses
Why Is it Changing?
Prior to the 2018 election, advocates introduced voter initiatives mandating employer-provided paid sick time and a $12 per hour minimum wage. These proposals gathered requisite signatures to appear on the 2018 ballot. However, Michigan’s Constitution mandates that initiatives amending statute first appear before the legislature prior to appearing on the ballot. The legislature adopted the proposals and later amended them to lessen the impact. This action, now called “adopt and amend,” prevented the original proposals from appearing on the ballot. Those who gathered initial signatures filed a lawsuit and raised the legal question of whether a legislature can amend a voter-initiated statute that it adopted within the same two-year legislative term in which it was adopted.
The trial court found in favor of the plaintiffs, saying the ‘adopt and amend’ practice was unconstitutional. The court of appeals disagreed and upheld the practice. The final decision rests in the hands of the Michigan Supreme Court, who announced Wednesday, July 31, 2024, that the legislature’s actions were unconstitutional, meaning that the initially adopted ballot language is now law.