Court ruling blocks minimum wage hike for Michigan workers next month

A Michigan Court of Appeals panel ruled Thursday that the Legislature's effort in 2018 to adopt and amend ballot initiatives in the same session was legal, blocking a nearly $3 to $8 an hour hike in the state's minimum wage from going into effect next month.

The three-judge panel's unanimous ruling overturns a lower court's decision, which would have allowed the state's minimum wage to jump from $10.10 per hour to $13.03 per hour on Feb. 19. Tipped workers were going to see their hourly minimum soar from $3.75 to $11.73 per hour under a 2018 voter-initiated law that the Legislature amended after adopting.

The appeals court ruled a Republican-controlled Legislature had the constitutional power to change minimum wage and paid sick time laws that had been initiated by citizens through a petition process.

"Because there are no limitations with respect to the amendment of initiated laws beyond the initial 40-session day period for legislative action, the Legislature is free to amend laws adopted through the initiative process during the same legislative session," Court of Appeals Judge Christopher Murray wrote in the majority opinion.

Mark Brewer, a lawyer for the groups that backed the proposals, said his clients were disappointed and would appeal to the Michigan Supreme Court. 

"My reaction is that 658,000 workers have suffered a setback and families are negatively impacted by this ruling," said Chris White, state director of Restaurant Opportunities Centers (ROC) United, a restaurant worker advocacy group that is a plaintiff in the case. "We feel that the people that are the front-line workers of the state deserve an increase in the minimum wage, and it should have happened years ago. And it is our responsibility to work together and fight to make sure that this is remedied by getting a favorable decision in the Supreme Court."

In 2018, Michigan One Fair Wage circulated petitions to have voters consider a proposal to increase the minimum wage to $12 an hour by 2022 from $9.25, at the time, and tie the rate to inflation. At the same time, Michigan Time to Care backed a proposal to generally require employers to provide paid sick time to their workers.

However, the GOP-controlled Legislature adopted the two initiatives before Election Day, preventing the measures from seeing statewide votes.

The moves allowed lawmakers to return after Election Day and change the laws with simple majorities. If voters had approved them, future changes would have required a three-fourths majority of support in the Legislature.

What Legislature did

Republican lawmakers slowed the minimum wage increases, so the minimum wage would climb to $12.05 by 2030, eight years later than under the original proposal, and removed a connection to inflation for future increases.

The legislative version eliminated a provision that sought to increase the minimum wage for tipped workers so it would match the standard minimum wage in 2024. The current minimum wage for tipped workers is $3.75 an hour.

The lawmakers also altered the sick-leave law, exempting small businesses that collectively employed more than 1 million workers from a policy that initially would have applied to every company.

The Legislature's 40-day delay before amendment after enactment complied with the Constitution and "absent some other prohibition, the Legislature was free to amend those public acts just as it could amend any other public acts," ruled Murray, an appointee of Republican former Gov. John Engler.

In a concurring opinion, Judge Michael Kelly labeled the "adopt and amend strategy" "anti-democratic."

"If the individuals responsible for this maneuver ever wonder why public opinion polls consistently cast politicians low when it comes to the virtue of trust, they need look no further than what they did here," Kelly wrote. "It is a direct assault on one of the rights our founding fathers and the drafters of our state constitution held dear: the right of the citizens to petition their government."

But Kelly concurred with the majority opinion and said the strategy passed constitutional muster.

The original voter-initiated law sought to boost the minimum wage for tipped servers to be more in line with the minimum wage other workers in restaurants, such as dishwashers, are ensured.

Workers react

Romona Hall of Detroit, a restaurant industry worker who declined to identify her employer, has been involved in the push to raise Michigan's wage with ROC United, the restaurant worker advocacy group that challenged the Legislature's "adopt and amend" strategy to water down the minimum wage law.

Hall, who's been in the industry on and off for about 30 years, said she makes $3.75 per hour plus tips and that her pay is difficult to predict day-to-day and week-to-week.

"It's not consistent," she said. "And it's not something you can depend on."

The proposed minimum wage increase, Hall said, would have helped — but not enough, given the high rate of inflation.

"It would have helped if we had gotten $15 (an hour) three years ago," she said, "because now everything has gone up so high."

Hall noted the cost of a dozen eggs, which rose 60% in 2022 and hit an average of $4.25 in December, more than her hourly minimum wage.

"That doesn't make sense to me, how everything can go upexcept our wages," she said.

Mothering Justice, another group that filed the suit, said it was disappointed in the delay to the "much-needed and deserved pay increase for Michigan workers" as well as those expecting to receive paid sick time.

"While today’s court ruling is a setback and another needless delay to a commonsense economic policy, we vow to appeal and seek justice before Michigan’s Supreme Court," said Eboni Taylor, executive director of Mothering Justice.

The Michigan Restaurant and Lodging Association expressed "relief" regarding Thursday's opinion and said it would provide some "certainty" to restaurants and hotels that were preparing for the Feb 19 hike.

"Through this ruling, countless restaurants and 50,000 hospitality jobs have been at least temporarily saved," said Justin Winslow, the association's president and CEO. "We are optimistic that the Michigan Supreme Court will recognize the same and allow this industry to redirect its focus to the daunting task of recovering from a pandemic that decimated it so completely.” 

The Michigan Chamber of Commerce said the opinion was "welcome news for Michigan's job providers."

"If the lower court’s ruling had been left to stand, it would have had dire consequences on the state’s employers, overall business climate and economy — all at a time when our state, communities and families can least afford it," said Wendy Block, the chamber's senior vice president of business advocacy and member engagement.

eleblanc@detroitnews.com