Great Lakes Wire

Michigan's Earned Sick Time Act, amended by House Bill 4002, will take effect on February 21, 2025, for employers with 11 or more employees. For small businesses with 1-10 employees, the act will be effective from October 1, 2025.

The act mandates that most employers provide "earned sick time" for various purposes including personal or family health needs, domestic violence and sexual assault situations, child health or disability issues, and public health emergencies. Entities employing one or more individuals are subject to this law except for the United States Federal Government and small businesses in their first three years of operation.

Under the act, employees eligible for earned sick time exclude those who set their own hours without a minimum requirement, unpaid trainees or interns, workers under the Youth Employment Standards Act (under age 18), and independent contractors.

Small businesses must offer one hour of paid sick leave per every 30 hours worked with a maximum usage cap of 40 hours annually. Larger employers must also provide one hour per every 30 hours worked but can limit usage to no more than 72 hours per year.

Employers may avoid tracking work hours by offering front-loaded paid sick time at the start of each year—40 hours for small businesses and 72 hours for larger entities. Employers using this method need not allow unused time to carry over to subsequent years.

The act does not require payout of unused leave upon employee separation. New hires begin accruing benefits immediately but cannot use them until after a probationary period of up to 120 days. Employers can integrate earned sick time into broader paid leave policies if they meet minimum requirements.

Employees using earned sick time receive payment at their regular wage rate but not less than the state minimum wage as defined by the Improved Workforce Opportunity Wage Act. Certain types of pay such as overtime and bonuses are excluded from these calculations.

Notification procedures are permissible under the act with specific conditions outlined for both foreseeable and unforeseeable uses of earned sick time. Documentation may be requested only after three consecutive days absent.

Enforcement falls under Michigan's Department of Labor and Economic Opportunity with claims permitted within three years from alleged violations. Employers must keep related records for three years and inform existing employees about their rights within a month following House Bill 4002's passage date or March 23rd. New hires should be notified on their employment start date.

SBAM is updating its ESTA Toolkit in response to these changes with further learning opportunities scheduled later in February.