H&L Quarterly – January 2025

01 Jan H&L Quarterly – January 2025

Michigan Supreme Court Restores Minimum Wage and Sick Leave Laws

Back in late-July of 2024, the Michigan Supreme Court (MSC) issued an opinion that will be taking effect very soon. In the case of Mothering Justice v. Attorney General, the MSC overruled previous actions of the Michigan Legislature, reinstating major changes to the state’s minimum wage and paid sick leave laws. Specifically, the court held that the original versions of the Earned Sick Time Act and the Improved Workforce Opportunity Wage Act were to be reinstated. 

The initial proposed laws were the result of a 2018 petition drive that collected more than 280,000 signatures. The legislature chose not to put the proposed laws on the ballot, and instead simply adopted its provisions. However, meaningful changes had been made by the legislature between the time the laws were proposed and the time they were adopted. Then-Governor Rick Snyder signed the legislation shortly before he left office, but the laws have been subject to court challenges ever since. In a 4-3 decision, the MSC held that lawmakers had violated the state constitution by adopting the laws after having made material changes to their content. In its majority opinion, MSC Justice Elizabeth Welch wrote “Allowing the Legislature to bypass the voters and repeal the very same law it just passed in the same legislative session thwarts the voters’ ability to participate in the lawmaking process.” 

The MSC’s ruling means that a new wage schedule, adjusted for inflation as determined by the state treasurer, will go into effect on February 21, 2025. Thereafter, the hourly minimum wage will be adjusted every year through 2029. The law also will gradually eliminate a lower minimum wage for tipped workers in restaurants, and the sick leave provisions mean that many businesses will be required to provide workers with paid time off.

The source for this article was reporting that can be found at: https://apnews.com/article/michigan-court-minimum-wage-sick-leave-c3c6196bec7aec5e274e0d0e69b84a40. A link to the Michigan Supreme Court’s website containing a full copy of the Mothering Justice v. Attorney General decision can be found here: https://www.courts.michigan.gov/4a2778/siteassets/case-documents/uploads/opinions/final/sct/165325_115_01.pdf. 

Magistrate Update

Just a few weeks ago, we reported on the the appointment and reappointment of several different magistrates within the workers’ compensation system. One of the judges recently reappointed has since passed away, in a very sad and unexpected turn of events. Magistrate Richard Ehrlich died just a few days before the new year, and his new term was set to begin on January 27, 2025. No formal indication has been given as to when another magistrate will be appointed as his replacement. 
 

Legislative PushIn late 2024, Democrats in both the Michigan House and Senate proposed legislative reforms to the workers’ compensation system. Among the proposed changes were a broader definition of disability, elimination of the post-injury wage earning capacity, elimination of a plaintiff’s obligation to seek restricted work, a conclusive presumption of disability when an employee loses employment within 100 weeks of return to favored employment, an increase of the maximum payable rate from 90% state average weekly wage to 100% State Average Weekly Wage, the expansion of total and permanent benefits to include a neurocognitive disorder or a traumatic or stress-related disorder, and the ability to add use fringe benefits to increase a plaintiff’s compensation rate beyond two-thirds of state average weekly wage.

Ultimately, these proposed reforms did not make it out of committee or to a vote before the end of last year’s legislative term. Shortly thereafter, the November 2024 election resulted in the Democrats losing their majority in the State House, and it no longer appears that the proposed reforms will be moving forward. We believe that the workers’  compensation attorneys who worked toward enacting these reforms still wish to make changes, and if any concrete progress is made in that regard, we will provide all the updated information that we have. 

Ministerial DetailsThe Michigan Department of Labor and Economic Opportunity (LEO), which has jurisdiction over the workers’ compensation system, recently made several small but important annual changes. For 2025, the State Average Weekly Wage rose to $1,292.23. This means that the maximum payable weekly wage in cases involving a 2025 injury totals $1,164.00. The follow link gives you access to the full State Average Weekly Wage charts: https://app.leo.state.mi.us/WORCS/Resources. LEO also raised the travel reimbursement rate to $0.70 per mile, as indicated in updated documentation located at: https://www.michigan.gov/leo/-/media/Project/Websites/leo/Documents/WDCA-Calculation-Program/Travel-Reimbursement-Rates.pdf?rev=f2f027d3434d4f6c927b0f552fdb89b9&hash=F8B761B36538666F4180D2417D29A328. Lastly, LEO changed the web address of the Average Weekly Wage and Compensation Rate Calculator, which is now located at:  https://app.leo.state.mi.us/WORCS/BenCalc/CalculationOptions.