Attorney General admits Michigan's minimum wage increase poses difficulties

Republican lawmakers are not the only ones raising concerns about Michigan’s minimum wage changes. Attorney General Dana Nessel has filed a motion with the state’s Supreme Court, asking for guidance on how to implement inflation adjustments.

Nessel specifically pointed out how the court’s broad language in its July ruling could lead to five possible options for when and how to adjust the minimum wage over time, with the state Department of Treasury’s approach and the Department of Labor and Economic Opportunity’s approach also at odds with each other.

“Respectfully, the Michigan Department of Treasury has read this Court’s opinion in earnest and believes there exist ambiguities as to how to interpret and implement this Court’s directives in accounting for inflation for the graduated wages for the 2025 through 2028 time period,” Nessel wrote. “Clarification is needed on (1) how to calculate the inflation rate for 2025 through 2028, (2) the meaning of the term “credit,” (3) whether the Court intended to exclude the 90% graduated increase for tipped wages, and (4) the effective dates for each year’s wage increases beginning in 2026.”

The minimum wage in Michigan is currently $10.33 per hour for non-tipped workers and $3.93 per hour for tipped workers. Following the Michigan Supreme Court’s decision last month, the minimum wage will rise to at least $12 an hour starting Feb. 21. By 2025, employers must grant their employees one hour of earned sick leave per 30 hours worked. Tipped workers will receive the same minimum wage as non-tipped by 2029.

Republicans opposed the changes, arguing that small businesses will be forced to raise prices and lay off workers.

State Rep. Matthew Bierlein, R-Vassar, highlighted Wednesday the results of a new survey of roughly 450 small and medium-sized business owners, using it to argue that the changes will spell economic disaster.

“Many local job providers throughout our region and the state are already moving in this direction and supporting their hardworking staff without court mandates,” Bierlein said. “In February, that all goes out the window, and new burdensome directives will cause havoc for small business owners and artificially spike costs. These directives will force some to lay off their employees, cut hours or close entirely. I have spoken with many business owners and employees who are scared about the effects these new measures will have.”

The new survey shows a 13-point drop since February in optimism among business owners about both short and long-term prospects.

But 48% of respondents also reported they expect staffing levels to remain basically unchanged in the year ahead, and 43% expect an increase in their number of employees next year.

Nessel has asked the court to rule on the motion by Sept. 15.