Michigan Employment Law 2026

2.1 Wage and Hour Rights

Minimum Wage (2026)

Michigan’s minimum wage increased effective January 1, 2026, under the Michigan Improved Workforce Opportunity Wage Act (IWOWA).

Current Michigan minimum wage (2026): $13.73 per hour

Effective date: January 1, 2026

Statutory authority: Michigan Improved Workforce Opportunity Wage Act, Public Act 337 of 2018 as amended

Official text of IWOWA:

According to Michigan Compiled Laws:

“Every employer shall pay to each employee wages at a rate of not less than the following amounts per hour: Beginning January 1, 2026, $13.73.”

Source: Michigan Improved Workforce Opportunity Wage Act Citation: MCL 408.414a as amended Official statute: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-408-414a Available at: https://www.michigan.gov/leo/bureaus-agencies/ber/wage-and-hour/publications_rules_statutes Last amended: 2024 (effective February 21, 2025 with annual adjustments)

Scheduled Future Increases:

• January 1, 2027: $15.00 per hour (projected)
• Additional increases in subsequent years tied to inflation

Minor Employees (Ages 16-17):

Employees between ages 16 and 17 may be paid 85% of the standard minimum wage:

• 2026 rate for minors: $11.67 per hour (85% of $13.73)

Source: MCL 408.414a(2) Provision: “An employer may pay 85% of the minimum hourly wage rate to a minor who is 16 years of age or older but less than 18 years of age.”

Training Wage (First 90 Days):

Newly hired employees under age 20 may be paid a training wage for their first 90 calendar days of employment:

• Training wage: $4.25 per hour

Source: Fair Labor Standards Act, 29 U.S.C. § 206(g) Official text: https://www.dol.gov/agencies/whd/minimum-wage/ Limitation: Training wage applies only for first 90 consecutive calendar days after hire

Tipped Employee Minimum Wage

Michigan permits a tipped minimum wage for employees who customarily receive tips.

2026 tipped minimum wage: $5.49 per hour

Effective date: January 1, 2026

Tip credit requirement: Employer must ensure employee receives at least $8.24 per hour in tips (difference between full minimum wage and tipped wage)

According to Michigan Compiled Laws MCL 408.414a:

“An employer in the restaurant, hotel, or similar business where gratuities have been customarily recognized as part of the employees’ remuneration may credit the gratuities received by a tipped employee against the minimum hourly wage.”

Tipped wage calculation: 40% of full minimum wage ($13.73 × 0.40 = $5.49)

Employer obligations for tipped employees:

1. Inform employees of employer’s tip provisions before employment begins
2. Employee must regularly receive tips
3. Combined tipped wage plus tips must equal or exceed full minimum wage
4. If tips plus tipped wage fall below minimum wage, employer must pay the difference

Source: MCL 408.414a(3) Official text: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-408-414a

Phase-out of tip credit: Under amendments to IWOWA, the tip credit will be gradually eliminated by February 21, 2030, requiring all tipped employees receive full minimum wage before tips.

Scheduled tip credit phase-out:

• February 21, 2026: 60% of minimum wage (from 40%)
• February 21, 2027: 70% of minimum wage
• February 21, 2028: 80% of minimum wage
• February 21, 2029: 90% of minimum wage
• February 21, 2030: 100% of minimum wage (full minimum wage before tips)

Coverage and Exemptions

IWOWA applies to:

• Employers with two or more employees
• Employees who work in Michigan
• Employees age 16 and older

Source: MCL 408.414(1)

IWOWA does not apply to:

• Employees subject to Railroad Unemployment Insurance Act
• Federal employees
• Certain agricultural employees under specific conditions

Enforcement and Penalties

Employees who believe they are not receiving proper minimum wage can file complaints with the Michigan Department of Labor and Economic Opportunity.

Source: Michigan Department of Labor and Economic Opportunity, Wage and Hour Division Available at: https://www.michigan.gov/leo/bureaus-agencies/ber/wage-and-hour Phone: 517-284-7800 Toll-free: 855-464-9243

Penalties for violations:

• Back wages owed to employee
• Liquidated damages
• Civil fines up to $1,000
• Potential criminal penalties for willful violations

Overtime Requirements

Michigan requires overtime compensation for covered employees who work more than 40 hours in a workweek.

Overtime rate: 1.5 times the employee’s regular rate of pay

When overtime is required:

According to Michigan Compiled Laws MCL 408.414a(1):

“An employer shall not require an employee to work at a rate of pay less than 1-1/2 times the regular rate at which he is employed for any hours over 40 hours per week.”

Source: MCL 408.414a(1) Official text: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-408-414a Federal parallel: 29 U.S.C. § 207 (FLSA)

Calculating overtime:

• Based on hours worked in a single workweek
• Workweek is fixed 168-hour period (7 consecutive 24-hour periods)
• All hours over 40 in workweek trigger overtime
• Vacation, sick leave, and holidays do not count as hours worked for overtime calculation

Overtime exemptions:

Michigan and federal law exempt certain employees from overtime requirements:

Executive, Administrative, and Professional Employees:

Employees performing bona fide executive, administrative, or professional duties are exempt from overtime if they meet both:

• Duties test (primary duties involve management, professional work, etc.)
• Salary basis test (paid predetermined salary not subject to reduction based on hours worked)

Source: MCL 408.414a(4)(a) Federal regulations: 29 C.F.R. § 541 et seq. Available at: https://www.dol.gov/agencies/whd/fact-sheets/17a-overtime

Other common exemptions:

• Outside sales employees
• Certain computer professionals
• Certain commissioned retail or service employees
• Certain seasonal amusement or recreational establishment employees

Special overtime rules for specific employees:

Public safety employees: Fire protection and law enforcement employees have special overtime calculation rules under both state and federal law.

According to MCL 408.414a(3):

“For an employee engaged in fire protection activities… in a work period of 28 consecutive days, the employee receives for tours of duty, which in the aggregate exceed 216 hours, compensation for those hours in excess of 216 at a rate not less than 1-1/2 times the regular rate at which the employee is employed.”

Source: MCL 408.414a(3) Federal parallel: 29 U.S.C. § 207(k)

Meal and Rest Break Requirements

Adults (Age 18 and Over):

Michigan does not require employers to provide meal or rest breaks to adult employees.

Verification: Search conducted of Michigan Compiled Laws Search terms: “meal break,” “rest break,” “employee breaks” Legislative website: https://legislature.mi.gov/ Date: January 7, 2026 Result: No state statute requiring breaks for adult employees

Federal law (FLSA):

Federal law does not require meal or rest breaks for adult employees.

According to U.S. Department of Labor, Wage and Hour Division:

“Federal law does not require lunch or coffee breaks. However, when employers do offer short breaks (usually lasting about 5 to 20 minutes), federal law considers the breaks as compensable work hours that would be included in the sum of hours worked during the work week and considered in determining if overtime was worked.”

Source: U.S. Department of Labor, Wage and Hour Division Topic: Breaks and Meal Periods Available at: https://www.dol.gov/general/topic/workhours/breaks Last updated: Current as of 2026

Employer policies:

• Employers may choose to provide breaks voluntarily
• If provided, short breaks (under 20 minutes) must be paid
• Bona fide meal periods (typically 30+ minutes) may be unpaid if employee is completely relieved of duties

Minors (Under Age 18):

Michigan requires meal breaks for employees under age 18.

According to Youth Employment Standards Act, MCL 409.117:

“A minor under 18 years of age shall not be employed for more than 5 consecutive hours without a 30-minute uninterrupted and duty-free meal break.”

Source: Youth Employment Standards Act Citation: MCL 409.117 Official text: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-Act-90-of-1978 Agency: Michigan Department of Labor and Economic Opportunity

Minor break requirements:

• 30-minute break required after 5 hours of work
• Break must be uninterrupted and duty-free
• Applies to all minors under age 18

Final Paycheck Requirements

Michigan law establishes specific timeframes for providing final wages when employment ends.

Employee Voluntarily Leaving Employment:

According to MCL 408.475(1):

“An employer shall pay to an employee voluntarily leaving employment all wages earned and due, as soon as the amount can with due diligence be determined.”

Exception for hand harvest workers:

“An employer shall pay all wages earned and due to an employee engaged in any phase of the hand harvesting of crops as soon as the amount can, with due diligence, be determined, but, in any event, not later than 3 days after the employee’s voluntary termination of employment.”

Source: Payment of Wages and Fringe Benefits Act Citation: MCL 408.475(1) Official text: https://www.legislature.mi.gov/Laws/MCL?objectName=MCL-408-475 Enacted: 1978

Employee Discharged from Employment:

According to MCL 408.475(2):

“An employer shall immediately pay to an employee who has been discharged from employment all wages earned and due, as soon as the amount can with due diligence be determined.”

Practical application:

• “Immediately” generally means on the same day as discharge
• If calculation requires time, payment must be made as soon as determinable with due diligence
• Typically next regular payday is maximum permissible delay

Source: MCL 408.475(2)

Penalties for late final payment:

According to Michigan Department of Labor and Economic Opportunity guidance:

Employers who fail to provide final paychecks on time may face:

• Civil penalties up to $1,000
• Order to pay unpaid wages
• Potential damages
• Attorney fees if employee files civil action

Source: Michigan Department of Labor and Economic Opportunity Agency: Wage and Hour Division Available at: https://www.michigan.gov/leo/bureaus-agencies/ber/wage-and-hour

Regular Wage Payment Requirements

Michigan establishes requirements for frequency of regular wage payments.

According to MCL 408.472:

Semimonthly payment (twice monthly):

“An employer shall pay to an employee who is owed wages all wages earned by the employee by the following dates:

(a) On or before the first day of each calendar month, the wages earned by the employee during the first 15 days of the preceding calendar month.

(b) On or before the fifteenth day of each calendar month, the wages earned by the employee during the preceding calendar month from the sixteenth day through the last day.”

Weekly or biweekly payment:

“An employer who has established a regularly scheduled weekly or biweekly payday is in compliance… if both of the following conditions are met:

(a) Wages are paid to the employee on the established regularly recurring payday.

(b) The payday occurs on or before the fourteenth day following the end of the work period in which the wages are earned.”

Source: Payment of Wages and Fringe Benefits Act Citation: MCL 408.472 Official text: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-408-472 Last amended: 2018

Key points:

• Employers must pay at least twice per month (semimonthly)
• Alternatively, employers may pay weekly or biweekly
• Payment must occur within 14 days of end of pay period
• Hand harvest workers must be paid weekly unless written contract provides otherwise
• Employers may pay more frequently than required

Permissible payment methods:

• Check
• Direct deposit (with employee consent)
• Electronic transfer (with employee consent)
• Payroll debit card (with employee consent)

Source: MCL 408.472 and 408.473

2.2 Earned Sick Time Requirements

Michigan requires most employers to provide earned sick time to employees under the Earned Sick Time Act, enacted as Public Act 338 of 2018 and significantly amended in 2025.

Coverage and Applicability

Small businesses (fewer than 50 employees):

According to MCL 408.963(2):

“An employee of a small business must accrue a minimum of 1 hour of paid earned sick time for every 30 hours worked, not including hours used as paid time off, but may not use more than 40 hours of paid earned sick time in a year unless the employer selects a higher limit.”

All other employers (50 or more employees):

According to MCL 408.963(3):

“All other employees must accrue a minimum of 1 hour of paid earned sick time for every 30 hours worked, not including hours used as paid time off, but may not use more than 72 hours of paid earned sick time in a year, unless the employer selects a higher limit.”

Source: Earned Sick Time Act Citation: MCL 408.961 et seq. Official text: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-408-963 Effective: February 21, 2025 (amendments) Last amended: Public Act 2 of 2025 (Immediate effect February 21, 2025)

Summary of accrual requirements:

Small businesses (fewer than 50 employees):

• Accrual rate: 1 hour per 30 hours worked
• Annual cap on use: 40 hours
• Type: Paid sick time

Larger employers (50 or more employees):

• Accrual rate: 1 hour per 30 hours worked
• Annual cap on use: 72 hours
• Type: Paid sick time

Covered employers:

• All private employers with at least one employee in Michigan
• Classification as “small business” based on employee count

Covered employees:

• All employees who work in Michigan
• Includes full-time, part-time, and temporary employees

Exemptions:

• Federal employees
• Employees covered by collective bargaining agreements under certain conditions
• Certain employees in the construction industry under specific circumstances

Permitted Uses of Earned Sick Time

According to MCL 408.964, earned sick time may be used for:

1. Employee’s own medical needs:
   • Mental or physical illness, injury, or health condition
   • Medical diagnosis, care, or treatment
   • Preventive medical care
2. Family member’s medical needs:
   • Same purposes as employee’s own needs
   • Caring for family member with medical needs
3. Specific qualifying reasons:
   • Closure of employee’s place of business by public health order
   • School or care facility closure for child due to public health emergency
   • Exposure to communicable disease where presence would jeopardize health of others
4. Domestic violence and sexual assault:
   • Employee or family member is victim of domestic violence or sexual assault
   • For medical treatment, victim services, psychological counseling, or legal assistance
   • To relocate due to domestic violence or sexual assault

Source: MCL 408.964 Official text: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-408-964

Definition of “family member”: According to MCL 408.962(f), family member includes:

• Biological, adopted, or foster child
• Stepchild or legal ward
• Child for whom employee has legal custody or guardianship
• Biological, adoptive, or foster parent
• Stepparent or legal guardian
• Spouse or domestic partner
• Grandparent or grandchild
• Sibling

Accrual, Carryover, and Use

Accrual begins:

• Earned sick time accrual starts on February 21, 2025 or date of hire (whichever is later)

When employees can begin using:

• Employees may begin using earned sick time after 90 days of employment

Carryover:

According to MCL 408.963(5):

“An employee may carry over to the immediately subsequent year earned sick time accrued but not used, up to the following amounts:

(a) For an employee of a small business, 40 hours.

(b) For an employee of an employer that is not a small business, 72 hours.”

Employer alternative (frontloading):

According to MCL 408.963(2) and (3):

Employers may provide the full amount of earned sick time at the beginning of the year for immediate use rather than using accrual method:

• Small businesses: 40 hours at start of year
• Larger employers: 72 hours at start of year

Notice and Documentation

Employee notice to employer:

• Employees must provide notice when possible
• Employer may require reasonable notice for foreseeable use
• Cannot require more than 7 days’ advance notice for foreseeable use
• Cannot deny earned sick time for failure to provide notice if use was unforeseeable

Employer may require documentation:

• Only if earned sick time used for more than 3 consecutive days
• Cannot require disclosure of details of health information
• Must accept reasonable documentation

Source: MCL 408.964 and 408.966

Rate of Pay

According to MCL 408.963(9):

“Earned sick time must be paid at the same base hourly rate of pay with the same benefits the employee would have earned during the time the earned sick time is used.”

Retaliation Prohibited

According to MCL 408.968:

“An employer shall not retaliate or discriminate against an employee because the employee has exercised or attempted to exercise a right under this act.”

Source: MCL 408.968 Official text: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-408-968

Enforcement

Complaints regarding violations of the Earned Sick Time Act can be filed with:

Michigan Department of Labor and Economic Opportunity Wage and Hour Division P.O. Box 30476 Lansing, MI 48909

Phone: 517-284-7800 Toll-free: 855-464-9243 Website: https://www.michigan.gov/leo/bureaus-agencies/ber/wage-and-hour

Available at: https://www.michigan.gov/leo Verified: January 7, 2026

Penalties for violations:

• Back payment of earned sick time owed
• Liquidated damages
• Fines and penalties
• Attorney fees for prevailing employees

2.3 Unemployment Insurance Benefits

Overview

Michigan provides unemployment insurance benefits to eligible workers who become unemployed through no fault of their own and meet ongoing eligibility requirements.

2026 Benefit Increases

Maximum weekly benefit rate increased effective January 1, 2026:

New maximum weekly rate: $530

Previous maximum: $446

According to Michigan Department of Labor and Economic Opportunity announcement (December 2024):

“The maximum weekly rate for unemployment benefits is scheduled to increase beginning Jan. 1, 2026, to $530, up from the current $446. The boost is part of bipartisan legislation signed into law by Gov. Gretchen Whitmer in December 2024 to provide stronger financial support for unemployed workers.”

Source: Michigan Department of Labor and Economic Opportunity Published: December 18, 2024 Available at: https://www.michigan.gov/leo/news/2025/12/18/unemployment-weekly-benefit-rate-increases-january-1-2026 Agency: Unemployment Insurance Agency (UIA)

Dependent allowance also increased:

• 2026 rate: $19.33 per dependent (up to 5 dependents)

Important note: Not all claimants receive the maximum weekly benefit rate. Individual benefit amounts are based on the claimant’s wage history and earnings in their base period.

Maximum benefit duration:

• Maximum 26 weeks of benefits (no change in 2026)
• Duration based on base period wages and unemployment rate

Eligibility Requirements

To qualify for unemployment benefits in Michigan, individuals must meet the following requirements:

According to MCL 421.28:

1. Registration requirement: “Register for work at MiTalent.org and have visited a Michigan Works! Association (MWA) service center to begin the reemployment process.”
2. Availability requirement: “Available for work: Willing to accept any suitable full-time employment.”
3. Ability to work: “Able to work: Physically and mentally capable of performing full-time work performed before losing a job or have been trained to do.”
4. Active work search: “Actively seeking suitable full-time work.”

Source: Michigan Employment Security Act Citation: MCL 421.28 Official text: https://www.legislature.mi.gov/Laws/MCL?objectName=mcl-421-28 Last amended: 2025

Monetary eligibility:

• Worked in Michigan during past 12-18 months
• Earned minimum wages during base period
• Base period wages meet state formula requirements

Reason for separation:

• Unemployed through no fault of own
• Not discharged for misconduct
• Did not voluntarily quit without good cause

Application Process

How to file:

Unemployment claims can be filed:

1. Online: Through MiWAM (Michigan Web Account Manager) at https://miwam.unemployment.state.mi.us/
2. By phone: 866-500-0017, Monday-Friday

What you need to file:

• Social Security Number
• Driver’s license or state ID
• Complete employer information for last 18 months
• Employment start and end dates
• Reason for separation
• SF-8 (federal employees) or SF-50 (civilian federal employees)

Source: Michigan Unemployment Insurance Agency Filing information: https://www.michigan.gov/leo Verified: January 7, 2026

Work Search Requirements

According to MCL 421.28, claimants must conduct work search activities, which may include:

“(a) Using resources available at a Michigan works agency office to do any of the following:

(i) Participate in reemployment services and eligibility assessment activities.

(ii) Identify the skills the individual possesses that are consistent with target or demand occupations in the local workforce development area.

(iii) Obtain job postings and seek employment for suitable positions needed by local employers.”

“(d) Applying for an available position with, submitting a resume to, or interviewing with employers.”

Source: MCL 421.28(2)(a)

Disqualifications

Benefits may be denied or reduced if claimant:

• Refuses suitable work without good cause
• Is discharged for misconduct
• Voluntarily quit without good cause attributable to employer
• Is unavailable for work
• Fails to conduct adequate work search
• Receives disqualifying income

Source: MCL 421.29 and 421.27

Appeals Process

Claimants may appeal benefit determinations:

1. File protest within 30 days of determination
2. Request hearing before Administrative Law Judge
3. Appeal to Michigan Compensation Appellate Commission if necessary
4. Judicial review available through Michigan courts

Contact Information

Michigan Unemployment Insurance Agency (UIA)

Phone: 866-500-0017 TTY: 866-366-0004 Hours: Monday-Friday Website: https://www.michigan.gov/leo

Source: Michigan Department of Labor and Economic Opportunity Available at: https://www.michigan.gov/leo Verified: January 7, 2026