Michigan Supreme Court Reinstates Voter-Initiated Sick Leave Law

At a Glance

• Effective February 21, 2025, the Earned Sick Time Act (ESTA) applies to all employees in Michigan and covers employees not eligible for sick leave under the Paid Medical Leave Act (PMLA).
• The ESTA contains anti-retaliation and anti-interference provisions, and allows employees to bring a civil action against their employer for violation of the ESTA.
• Employers not previously covered by the PMLA should implement a sick leave policy in accordance with the ESTA, and employers who currently follow the PMLA should review their policies and revise them to comply with the ESTA.

On July 31, 2024, the Michigan Supreme Court reinstated the original Earned Sick Time Act (ESTA) that Michigan voters initiated in 2018. Pursuant to the supreme court’s ruling, effective February 21, 2025, Michigan employers must follow the ESTA, which covers more employers and allows for more sick time than the law previously in effect (the Paid Medical Leave Act, or PMLA). The court also reinstated the accelerated adoption of a $12 minimum wage in Michigan initiated by voters through the Improved Workforce Opportunity Wage Act (IWOWA). This ruling follows a protracted legal challenge to the PMLA.

Procedural and Legislative History

The ESTA/PMLA saga began in 2018, when voters in Michigan initiated the ESTA and IWOWA (which implemented a $12 per hour minimum wage by 2022). Rather than allow voters to decide the fate of those initiatives, the Michigan legislature “adopted” them, and during that same legislative session, amended them. In doing so, the legislature delayed the minimum wage increase until 2030 and narrowed sick leave requirements, as enacted through the PMLA.

As we previously reported, in 2022, the Michigan Court of Claims struck down the PMLA and reinstated the ESTA. However, in 2023, the Michigan Court of Appeals reversed the court of claims and put the PMLA in place. Employers in Michigan have accordingly followed the PMLA for approximately the last five years.

New Sick Leave and Minimum Wage Requirements

Now, employers will need to follow the ESTA, as of February 21, 2025. The ESTA expands Michigan’s sick leave requirements, as compared to the PMLA, in many ways, including:

1. The ESTA applies to any employer with one or more employees, as opposed to the PMLA, which only applied to employers with 50 or more employees.
2. The ESTA requires accrual at a rate of one hour of sick leave for every 30 hours worked; the PMLA required an accrual rate of one hour of sick leave for every 35 hours worked.
3. The ESTA does not allow employers to cap accrual or carryover, but allows employers to cap annual use at 72 hours (for employers with fewer than 10 employees, only the first 40 hours must be paid). This is significantly different from the PMLA, which generally allows employers to cap annual accrual, carryover and annual use at 40 hours.
4. The ESTA applies to all employees in Michigan and covers employees not eligible for sick leave under the PMLA, including employees classified as exempt under the Fair Labor Standards Act (FLSA), part-time employees and temporary employees.
5. Unlike the PMLA, the ESTA does not expressly permit frontloading sick leave.
6. In addition to the reasons provided by the PMLA, the ESTA allows employees to use sick leave for meetings at an employee’s child’s school or place of care related to the child’s health or disability, or the effects of domestic violence or sexual assault on the child.
7. In addition to the individuals covered under the PMLA’s definition of “family member,” the ESTA also covers domestic partners and “any other individual related by blood or affinity whose close association with the employee is the equivalent of a family relationship.”
8. The ESTA does not allow employers to require documentation supporting an employee’s use of sick leave unless the employee is absent for more than three consecutive days.
9. Under the ESTA, paid sick leave may be used in the smaller of hourly increments or the smallest increment that the employer’s payroll system uses to account for absences or use of other time. The PMLA only imposed a minimum increment of one hour.
10. The ESTA contains anti-retaliation and anti-interference provisions, and allows employees to bring a civil action against their employer for violation of the ESTA.

In addition, the supreme court ruled that the IWOWA must be implemented, subject to an adjustment for the passage of time since it was adopted by the legislature. As a result, Michigan’s minimum wage will reach $12 an hour on February 21, 2028. 

Key Takeaways

The institution of the ESTA significantly expands Michigan’s sick leave requirements. Employers not previously covered by the PMLA should implement a sick leave policy in accordance with the ESTA, and employers who currently follow the PMLA should review their policies and revise them to comply with the ESTA.