Recent increases in the Michigan minimum hourly wage ($7.15 beginning July 1, 2007, and yet another increase to $7.40 beginning July 1, 2008) have overshadowed the federal minimum wage increase ($5.85 per hour), which took effect on July 24, 2007. Although the federal minimum increase has little impact on Michigan employers because the Michigan rate is higher, they should remain mindful of their obligation to post a notice explaining the protections of the Fair Labor Standards Act (FLSA), together with all other required federal employment law postings. These postings must be in a conspicuous location at each place of business operated by the employer. For your convenience, a printable copy of the current poster may be found at the U.S. Department of Labor’s website. Also, the Michigan Unemployment Insurance Agency has a web page providing a comprehensive list of employee posters required by Federal and Michigan law.
Please note that the federal minimum wage is scheduled to increase to $6.55 per hour on July 24, 2008, and to $7.25 per hour on July 24, 2009. For each increase, a new poster will be necessary.
The recent FLSA minimum wage amendments did not address the minimum wage for tipped employees. It therefore remains at $2.13 per hour. As a consequence, employers with tipped employees enjoy the right to claim a larger “tip credit” (the difference between the federal minimum wage and the minimum wage for tipped employees – currently $3.72). But the FLSA remains unchanged in situations where a tipped employee’s wages plus tips do not exceed the minimum wage – employers must still pay the difference.
With additional changes to both the federal and state minimum wage laws looming, including bills in the Michigan Legislature aimed at eliminating the tip credit and adjusting the minimum wage rate for inflation, we will continue to monitor these issues and keep you updated. If you have any questions or comments regarding this or any other employment issues, please contact a member of Berry Moorman’s Labor & Employment Group.