The Michigan Legislature enacted a new law in December 2018 which requires certain employers to provide certain employees with PAID medical leave for personal or family health needs as well as leave related to domestic violence and sexual assault.
There was a lot of controversy around this new law because it was originally accepted as a ballot initiative for the 2018 election. The original initiative had far more extreme and unrealistic requirements for the employer. It was pushed by “workers” groups along with a new and onerous minimum wage ballot initiative which, if passed, would also have eliminated the tip credit. To avoid these anti-business and costly jobs killing initiatives, the Michigan legislature voted to pass the initiatives themselves thereby circumventing the public votes and allowing them to amend the initiatives to make them more business-friendly.
As a consequence, the final law is more business-friendly but still a new obligation and paperwork burden for employers.
What do you need to do and know as a restaurant owner?
First, the Act applies only to businesses with 50 or more employees. The Act does not define how you determine if you have 50 employees. The ACA (Obamacare) law defines how to calculate 50 employees. The new Michigan law does not. We expect LARA, the Michigan agency tasked with enforcing this Act will come up with some guidelines in the near future.
Second, the law is effective on March 29, 2019 at the same time as the new minimum wage increase.
Third, there are two penalties. $100 for not posting the requirements in a common area for employees to see and $1,000 for any instance of an employer that fails to provide the paid leave.
For those over 50 employees, the law requires that you monitor employees who work over 25 hours per week and accrue 1 paid medical leave hour for every 35 hours worked to a maximum of 40 hours per benefit year. You can talk to Kallas payroll about how to do this.
The law allows an employer latitude to make his or her own notice, procedure and documentation requirements as long as they are written in an employee manual that has been distributed at the time of hiring.
There are definitions as to who is an employee and other rules which are beyond what we can describe in this short article.
KEY – RULE OF THUMB: if you are over 50 employees, you should sit down with a knowledgeable human resource expert on how to document or update your employee manual to address the issues presented by the new Medical Leave Act. If properly designed, your cost to comply could be reduced significantly.