On January 1, 2022, the minimum wage in Michigan will increase to $9.87 per hour. This is a 22-cent increase from the current rate of $9.65 per hour, and the first increase in Michigan since 2020, before the COVID-19 pandemic hit.
Michigan law requires automatic annual increases in the minimum hourly wage on January 1 of each year, up to $12.05 through 2030. However, the law also states that when the unemployment rate in Michigan exceeds 8.5 percent for the calendar year before the planned increase, the annual increase will automatically be delayed and there will be no increase in the minimum wage. In 2020, the unemployment rate in Michigan reached 9.9 percent, and as a result the minimum wage did not increase in January 2021.
The state also announced that in 2022 the minimum hourly wage rate for tipped employees will increase 8 cents from $3.67 per hour to $3.75 per hour. Likewise, the minimum hourly wage for employees 16-17 years of age will increase by 19 cents to $8.39 per hour.
Michigan employers will be responsible for paying any shortfalls to an employee if the employee’s hourly rate, including gratuities, does not equal or exceed the new minimum wage requirements.
Please contact your Varnum attorney, or any member of the firm’s labor and employment practice team, with questions about how the increase will affect your workforce.