New bill would boost Michigan's minimum wage, limit wage hike for tipped workers
(CBS DETROIT) - A bill introduced in the Michigan Senate would increase the state's minimum wage, while also stopping a drastic increase to wages earned by tipped workers.
Senate Bill 1233 was introduced Tuesday by Republican Senator Wayne Schmidt. The bill would make several amendments to the Workforce Opportunity Wage Act of 2014.
It would immediately raise minimum wage to $12 per hour, and allow for an annual minimum wage increase in starting in 2024. That increase would be based on the yearly rise in the Consumer Price Index.
Raising the minimum wage to $12 per hour is on par with a ballot initiative that had enough signatures to make the ballot in 2018. But that's not the case with minimum wage for tipped workers. They currently make 38% of the minimum wage, which amounts to $3.75. This new bill would increase the rate to 40% of minimum wage. Taking into account the new minimum wage proposed in the bill, tipped workers would earn around $4.80.
That's significantly less than the ballot initiative that could have been in the voters hands In 2018. However, instead of voters deciding the fate of that initiative, the state legislature adopted it as a bill, then amended it just months later in a process known as adopt and amend. Those changes were deemed unconstitutional by the Michigan Court of Claims last year. Because of that ruling, the amended bill was thrown out, and the original bill took its place. That original bill, based on the ballot initiative, would have given tipped workers 80% of minimum wage this year. That amounts to $9.60, which is double what it would be if the bill introduced this week were passed into law. If the new bill does not pass, and the original bill were to stay in place, tipped workers would be paid the full minimum wage by 2024.
Even with the Court of Claims ruling adopt and amend unconstitutional in the case of the 2018 minimum wage law, minimum wage still has not made a significant jump. That's because the Court of Claims stopped it from taking effect until as early as Feb. 19, 2023. That's when those changes will take effect, unless a new law is passed like the one introduced this week, or unless the Court of Appeals overturns the ruling by the Court of Claims.