Michigan minimum wage increase, paid sick leave wiped out after appeals panel ruling
A three-judge Court of Appeals panel on Thursday reversed a lower court decision, preventing Michigan’s hourly minimum wage from rising to $13.03 and changing the state’s laws on paid sick leave on Feb. 19. The ruling likely sets up a battle at the Michigan Supreme Court between advocates who pushed for the wage and sick time changes and state attorneys.
The panel, consisting of Court of Appeals Judges Christopher Murray, Michael Kelly and Michael Riordan, ruled the Michigan Legislature, controlled by Republicans at the time, did have the constitutional authority in 2018 to adopt a pair of petition initiatives and amend their respective policies, instead of having the initiatives go to the ballot that November.
In a 20-page published opinion, Murray wrote there is no explicit language in the Michigan Constitution banning the Legislature from adopting laws initially brought forward by petition initiative and amending those laws in the same legislative session.
"The constitutional convention record squarely supports the conclusion that there was no intention to place a temporal limit on when the Legislature could amend initiated laws enacted by the Legislature," Murray wrote.
Michigan's hourly minimum wage will remain at $10.10, thanks to the ruling. The tipped minimum wage remains at $3.84 an hour. The tipped minimum wage is the pay rate given to employees who are expected to make the bulk of their earnings through tips, like restaurant servers and bartenders.
Had the Court of Appeals not reversed the lower ruling, the minimum hourly wage would have increased to $13.03 an hour. The tipped minimum wage would have increased to $11.73 an hour before being eliminated altogether and putting tipped employees at the regular minimum wage on Jan. 1, 2024.
During oral arguments in front of the appeals panel in December, state attorneys representing Michigan’s House and Senate argued the Legislature had the constitutional authority to adopt and amend the initiative in 2018, saying there was no express law preventing the tactic.
Advocates for the initiatives as they were originally written say raising the minimum wage in Michigan would be a strong step toward eliminating economic barriers for the working class.
The case is likely to be appealed to the state’s Supreme Court. Mark Brewer, the attorney representing pro-increased wage group Mothering Justice in the case, told the panel during oral arguments, “I frankly expect that at whatever decision you make, we will end up in front of the Michigan Supreme Court.”
In December 2019, the state's high court declined to hear the issue of adopt-and-amend.
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The Court of Appeals ruling, at least for the moment, affirms the Michigan Legislature’s constitutional authority to adopt petition initiatives as law and amend the initiatives in the same legislative session.
In July, Court of Claims Judge Douglas Shapiro ruled the Legislature acted unconstitutionally in 2018 when it adopted legislation created through a petition initiative originally intended to enact the wage changes, but in the same session amended the language to put in lower wage thresholds that increased the minimum wage to $12.05 by 2030 instead of 2022 and kept the tipped minimum wage at 38% of the standard one.
Shapiro's ruling also addressed a separate petition initiative originally intended to require Michigan employers to provide one hour of paid sick time for every 30 hours of work. Employers with fewer than 10 employees would have to allow employees to accrue up to 40 hours of paid sick time annually, and employers with 10 or more would have to allow employees to accrue up to 72 hours of paid sick time per year.
In 2018, the Legislature amended the petition to remove requirements for employers with fewer than 50 employees.
While all three judges shared the same ruling opinion, Kelly wrote in a separate concurring opinion the tactic used by the Legislature was "anti-democratic" and circumvented the original intent of the petition initiative organizers.
"Although this procedure is permissible under the language of our constitution, this ploy — adopting an initiative into law so as to prevent it from going onto the ballot and then promptly and substantially amending that law in a manner that has left it essentially defanged — is anti-democratic," Kelly wrote. "I cannot believe that this drastic action is what the drafters of our constitution even contemplated, let alone intended."
Business and hospitality advocacy groups in Michigan had expressed concern over Shapiro's initial ruling, saying the increases to minimum wage and earned sick time, as well as the elimination of the state's tipped wage scale, would harm small business owners in Michigan.
"We are relieved and appreciative of the unanimous ‘Adopt and Amend’ decision out of the Court of Appeals today that will allow Michigan and its 18,000 restaurants and hotels to move forward with greater certainty as to their operating future. Through this ruling, countless restaurants and 50,000 hospitality jobs have been at least temporarily saved," Michigan Restaurant & Lodging Association President & CEO Justin Winslow said in a statement.
"We are optimistic that the Michigan Supreme Court will recognize the same and allow this industry to redirect its focus to the daunting task of recovering from a pandemic that decimated it so completely."
Eboni Taylor, executive director of Mothering Justice, said the group will appeal Thursday's ruling.
“We are extremely disappointed by the Michigan Court of Appeals decision to side with the former Republican-controlled Legislature’s ‘adopt-and-amend’ shenanigans. The decision, once again, delays a much-needed and deserved pay increase for Michigan workers,” Taylor said in a statement.
“This is also a devastating blow to Michiganders that deserve paid sick time. The people of Michigan have long waited for earned paid sick time changes to be actualized. Everyone deserves and needs paid time off to take care of themselves or family members, and our economy will see the benefit of a labor ecosystem that honors this. We cannot delay any longer."
Contact Arpan Lobo: firstname.lastname@example.org. Follow him on Twitter @arpanlobo.
This article originally appeared on Detroit Free Press: Michigan minimum wage increase wiped out after appeals panel ruling