LANSING — Michigan policymakers are running up against a quickly approaching deadline for sick time and tipped wage changes.
Without intervention from the Legislature, those reforms will go into effect next week, more than half a year since the Michigan Supreme Court cleared the changes last summer.
“No solution, no compromise over the next nine days is is not an acceptable outcome for an industry, and we’ll all be feeling the negative outcome,” said Justin Winslow, CEO of the Michigan Restaurant and Lodging Association.
Currently, the minimum wage is $10.56 and the tipped wage is $4.01.
If a deal isn’t reached by the 21st, some changes would go into effect immediately. The minimum wage would sit at $12.48, while the tipped wage would land at $5.99.
In 2026, the minimum wage would rise to $13.29, and the tipped wage would increase to $7.97. Those increases would continue through 2030, when the minimum wage would sit above $15 an hour and the tipped wage would be eliminated.
Most tipped workers say that they’d expect their take-home pay to decrease if the tipped wage is phased-out, due to potential menu price increases and decreased demand for dining.
“From many servers that I’ve talked to, they currently make anywhere from 20 to $40 an hour in the system that operates today,” said Sen. Kevin Hertel, (D) 12th District, St. Clair Shores. “And they’re worried about their livelihoods, because they’re worried that those tips will reduce if this policy goes into effect.”
Gov. Gretchen Whitmer weighed in publicly Wednesday after remaining coy on the issue in recent weeks, saying in a statement the she is open to a “bipartisan deal that protects servers and wait staff, while also providing certainty to small businesses and helping Michigan remain competitive.”
Whitmer is encouraging lawmakers to kick the can down the road if they can’t reach a deal this week, and to pass a short-term extension through July 1, though lawmakers and the restaurant industry say they’d rather come to an agreement as soon as possible.
“We really hope that they can come up with a comprehensive solution before the deadline, because this issue will will remain the same and will still cause businesses to be unclear up until July,” said Haley Bennett, director of government relations for Traverse Connect.
The Republican plan — HB 4001 — would slightly delay the minimum wage increases and keep tipped wages flat at 38%. Tipped wages would rise to $5.70 in 2029, with inflation-pegged increases in following years.
The Democratic plan — SB 8 — would move up the minimum wage hike and eventually raise the tipped wage to 60%, though this would happen much more gradually through 2034.
“Let’s hope we can just find something somewhere in the middle that will work for everybody. It’s clear we have bipartisan urgency to do something,” said John Sellek, spokesperson for Save MI Tips. “We’ve got Democrats that voted for the House bill in the House. We’ve got Republicans here that could support a compromise in the Senate. We just need to get this thing done.”
The changes will start to go into effect on the 21st, but could be undone by future action from lawmakers.