State Rep. Will Bruck is urging the Michigan Legislature to address the potential economic impact of recent changes to minimum wage and paid sick leave laws, warning that businesses will struggle to comply if significant action isn’t taken as soon as possible.

A Michigan Supreme Court decision mandates a series of wage increases starting in February 2025, including raising the state minimum wage from $10.33 to $12.48 per hour and phasing out the tip credit for tipped employees. Additionally, the ruling introduces new paid sick leave requirements, affecting every employer, even small businesses.

“These changes are the gorilla in the room staring down Michigan’s economy,” said Bruck, R-Erie. “If we don’t act now, we will see businesses shuttering, job losses, and prices rising across the board. This is an economic disaster waiting to happen, and we have a duty to stop it.”

A recent survey highlights the impact on the restaurant industry, with 82% of servers supporting the current tipping model and 79% fearing job losses if the tip credit is eliminated. Nearly two-thirds of restaurant operators expect to reduce staff, and nearly 20% of full-service restaurants face possible permanent closure.

Under the new paid sick leave policy, even small employers must provide paid leave, including for temporary or seasonal workers, without exemptions. Employers offering more generous benefits will need to alter policies to meet new standards, such as separating sick time from paid time off and adjusting accrual methods. In addition, the elimination and inconsistency of sick time required notice and erratic implementation will negatively affect both employers and employees. 

Business groups, including the Michigan Chamber of Commerce and the Michigan Manufacturers Association, are advocating for adjustments to the paid sick leave policy, including flexible leave allocation and advance-notice requirements for employees. Democratic legislators, and the governor, however, have yet to address these proposals nor even consider them publicly.

“Michigan’s small businesses are fighting to stay alive in a very challenging economy,” Bruck said. “We should be helping them, not handing down mandates that force them to make impossible choices. Instead of burdens, we should be providing support.  The Legislature must act now and provide real solutions to protect both businesses and workers.”

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