Detroit City Wire

The Detroit Regional Chamber's Public Policy and Business Advocacy team has focused on the Earned Sick Time Act (ESTA) and minimum wage reform over the past five months. As Michigan's 103rd legislature began this week, new legislation was introduced in both the Michigan House of Representatives and Senate to amend ESTA and minimum wage laws.

The Chamber outlined five legislative priorities aimed at mitigating significant impacts of the law. One priority is allowing existing paid time off banks to cover sick time instead of requiring separate banks. The Senate version permits a combined PTO/ESTA bank if it meets ESTA requirements, while the House version allows for a PTO/ESTA bank without such conditions.

Another focus is carving out exceptions for small businesses unable to meet ESTA requirements. The Senate bill defines small businesses as those with fewer than 25 employees, whereas the House bill sets the threshold at fewer than 50 employees.

The Chamber also advocates for requiring employees to notify employers within a reasonable timeframe about expected ESTA usage, permitting employers to request documentation for sick time, and allowing exemptions related to staffing ratios. The Senate bill includes an exemption for mandated staffing ratios, while the House bill lets employers establish procedures and documentation regarding sick time management.

Both bills propose removing automatic assumptions favoring employees in cases of unfavorable personnel actions—a provision not found in other states—and allowing for paid time off frontloading, which is currently prohibited.

Although legislative action before February 21 seems likely, changes are not expected within the next 40 days. Businesses are advised to comply with current ESTA requirements in preparation for potential amendments.