Michigan's New Earned Sick Time Act Notice - Compliance Summary
OVERVIEW
Michigan’s new Earned Sick Time Act (“ESTA”) took effect on February 21, 2025. ESTA replaces Michigan’s previous paid leave law and generally requires most Michigan employers to provide earned sick time to employees, including exempt, non-exempt, temporary and part-time employees.
COMPLIANCE SUMMARY
SICK TIME ACCRUAL OR "FRONT-LOADING"
Michigan employers must accrue 1 hour of earned sick time for every 30 hours worked for all employees, including hourly, salary, temporary and part-time employees. For employers with 10 or more employees, compliance began on February 21, 2025. For small employers with 10 or fewer employees, compliance may be delayed until October 1, 2025. For salaried employees, the law allows employers to assume 40 hours worked in a work week unless the employee’s normal work week is less than 40 hours.
Alternatively, the law allows employers to front-load 72 hours of paid earned sick time for full-time employees, or 40 hours for small employers with 10 or fewer employees. Employees who work less than full-time must be front-loaded based upon their anticipated hours, and additional time must be provided if actual hours exceed anticipated hours. If accruals are used, employers may limit carry-over of earned but unused sick time from year-to-year to 72 hours, or 40 hours for small employers. Employers that front-load earned sick time are not required to accrue or carry-over earned but unused sick time from year-to-year. Employers may use existing paid time off policies, including PTO and vacation policies, to comply with ESTA, provided such policies meet ESTA requirements.
LIMITS ON USE OF SICK TIME
Employers with 10 or more workers can limit use to 72 hours per benefit or calendar year. Small employers with less than 10 workers can limit use to 40 hours per benefit or calendar year. All employers can delay use of sick time for new employees for 120 days. The law provides for the use of sick time in 1 hour increments or the smallest increment by the employer’s policies for other absences.
REASONS FOR USE OF SICK TIME
Permissible uses include:
- Employees’ and family members’ mental or physical illness, injury, care or treatment,
- If employee or family member are victims of domestic violence or sexual assault,
- Meetings at child’s school or caregiver related to child’s health, domestic violence or sexual assault, or
- Closure of business or school by order of public officials for health emergencies, including quarantines.
PAYMENT FOR SICK TIME
- For employers with 9 or less workers, all 40 hours of sick time is paid.
- For employers with 10 or more workers, all 72 hours is paid.
- No requirement for payment of accrued and unused sick time upon separation of employment.
NOTICE AND DOCUMENTATION OF SICK TIME
- Employers may require employees to provide prior notice for foreseeable absences and if unforeseen, notice as soon as practicable.
- For absences of more than three consecutive days, employer may require documentation.
- Most employers are required to notify employees of their sick time policy no later than March 23, 2025.
UNION EMPLOYEES
If a collective bargaining agreement (CBA) already provides employees with paid sick leave or paid time off benefits, employers generally are not required to comply with the Earned Sick Time Act until the CBA expires or is renewed after February 21, 2025.
WHAT SHOULD EMPLOYERS DO?
We are working with clients daily to meet the challenges of this new law and to provide workable solutions for clients.
- Review your existing policies for paid benefits such as PTO, vacation and sick time.
- Contact your outside payroll service or in house payroll department to determine their ability to accrue sick time as required by the new law.
- Contact us, so that we can work with you to comply with the new laws’ requirements.
RESOURCES REGARDING THE NEW EARNED SICK TIME ACT FROM THE GOVERNMENT OF MICHIGAN
LEGISLATIVE UPDATES
For important information and insights on major new legal developments check out the Legislative Updates section of kkue.com. For further information or questions regarding Michigan’s Earned Sick Time Act please contact Mark Filipp or Faith Gaudaen.
Mark R. Filipp
