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Nobody ever said running a business was easy. As an employer, you have many things to handle, and compliance is just one of them.
In addition to U.S. Federal regulations, each state has its own share of employment-related laws that business owners need to be aware of. Here, we’re highlighting some of these key state-specific requirements, and offering guidance to help you keep up.
Bear in mind that this list is not comprehensive, and there may be local or industry-specific employment requirements that your business needs to comply with. It’s best to consult with counsel to ensure compliance with all applicable laws, as Justworks does not provide legal advice.
Payroll Tax Accounts
Because Justworks reports state unemployment taxes on behalf of customers who utilize Justworks’ PEO services, Justworks may need to collect account information such as your account number and current rate. You can read more about it here: State Unemployment Insurance.
Independent Contractors
When deciding whether to classify workers as employees or independent contractors, there are a few things your business should consider, including the varying tests that apply under different federal and state employment laws, and the potential penalties and other liabilities for misclassifying employees as independent contractors.
You can read our general Help Center article on contractors, and view information on how to determine if someone is a contractor or employee in Michigan in the relevant section at the link below.
Mineral*: Michigan Independent Contractors
Michigan Labor and Economic Opportunity (LEO): Independent Contractor or Employee
Pay Requirements
Minimum Wage & Overtime
Michigan’s minimum wage requirement is higher than the federal minimum wage. Further information about on minimum wage, overtime, and other related rules and regulations in Michigan can be found at the links below.
Michigan Labor and Economic Opportunity (LEO): Minimum Wage & Overtime FAQs
Mineral*: Michigan Minimum Wage and Overtime
Pay Equity
Michigan employers with two or more employees are prohibited from discriminating against employees on the basis of sex and are required to offer equal pay for equal work in roles with similar working conditions. Exceptions to this include:
- Pay based on seniority or merit system
- A system that measures earnings by quantity or quality of production
- Pay differential based on a factor other than sex
Mineral*: Michigan Pay Equity and Transparency
Leave
Paid Sick Leave
Employers in Michigan with 10 or more employees must provide up to 72 hours of paid sick leave annually, while those with fewer than 10 employees must offer up to 40 hours of paid leave, plus an additional 32 hours of unpaid leave.
Mineral*: Michigan Sick Leave
Jury Duty and Witness Leave
Employers must allow employees time off (no need to be paid) to attend to jury duty. Employers can mandate the employee attend work when not on a jury if the number of hours they work plus time spent on jury duty doesn't exceed the number of hours they normally
work or go beyond their normal quitting time. An employee can always voluntarily agree to work more hours.
Employers must also allow employees time off (no need to be paid) to testify when subpoenaed.
Mineral*: Michigan Jury Duty and Court Leave
Leave for Crime Victims
Employers must allow employees who are crime victims to take leave if their testimony in court is required or requested. Employers also must allow an employee who is a victim representative to take leave if the employee wants to attend court proceedings to be present for the victim's testimony. Employees with paid sick leave benefits covered by Michigan law (see Paid Sick Leave section above) who are sexual assault or domestic violence victims (or whose family member was the victim) must be allowed to use paid sick leave benefits for matters related to the crime (e.g., go to a victim services organization, participate in legal proceedings, or obtain related legal services).
Mineral*: Michigan Victim Leave
Harassment & Discrimination
In addition to protections under federal law, [state] law prohibits discrimination by covered employers, because of an employee’s membership in any protected class, including race, color, religion, national origin, sex, pregnancy, childbirth or related medical conditions, age (40 or over), marital status, sexual orientation, gender identity, military status, or disability in places of public accommodation.
Elliot-Larsen Civil Rights Act (ELCRA)
The Elliot-Larsen Civil Rights Act (ELCRA) outlines protected classes for Michigan employers with one or more employees to include age, color, religion, race, national origin, height, weight, hairstyle, familial or marital status, pregnancy, childbirth, or related medical conditions, sexual orientation, and gender identity or expression. The ELCRA also expands workplace protections against the discrimination of an employee’s rights in their decision to have an abortion.
Michigan Department of Civil Rights: Elliott-Larsen Civil Rights Act
Persons with Disabilities Civil Rights Act (PWDCRA)
Michigan’s Persons with Disabilities Civil Rights Act (PWDCRA) outlines that Michigan employers with one or more employees must provide reasonable accommodations to individuals with a disability unless the accommodation poses an undue hardship for the employer. Unlike the federal law Americans With Disabilities Act (ADA), such accommodations do not need to include the transfer of the employee to a different job or a leave of absence unless the employer has 15 or more employees.
Michigan Department of Civil Rights: Persons with Disabilities Civil Rights Act
Mineral*: Michigan Employment Discrimination and Accommodations
Separation
Final Pay & Document Requirements
In Michigan, final wages for separating employees should be issued no later than the next regularly scheduled payday.
Accrued, unused vacation time need not be paid out to the employee unless the employer’s policy requires it. Employers should clearly set forth in writing any policy with respect to unused vacation.
Additionally, employers must also provide an unemployment insurance notice (Form UIA 1711, “Unemployment Compensation Notice to Employee”) to all separating employees, regardless of the reason for leaving. You can access the form here.
Mineral*: Michigan Separation
Michigan Labor and Economic Opportunity (LEO): Payment of Wages at Termination
Michigan Labor and Economic Opportunity (LEO): Payment of Fringe Benefits at Termination
Michigan Labor and Economic Opportunity (LEO): How to file a claim for unemployment insurance benefits
Business Closings and Layoffs
The Federal Worker Adjustment and Retraining Notification (WARN) Act imposes certain notices and other obligations on covered businesses before conducting large-scale business closures, layoffs, or relocations.
US Department of Labor (DOL): Worker Adjustment and Retraining Notification (WARN) Act Advisor
Michigan Labor and Economic Opportunity: Worker Adjustment and Retraining Notification Act (WARN)
Mineral*: Michigan Layoffs
Notes
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Disclaimer
This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, legal or tax advice. If you have any legal or tax questions regarding this content or related issues, then you should consult with your professional legal or tax advisor.