From Staff Reports

TRAVERSE CITY — The 22-cent minimum wage increase scheduled to go into effect on Jan. 1 probably won’t.

Michigan’s Improved Workforce Opportunity Wage Act of 2018 prohibits scheduled minimum wage increases when the state’s annual unemployment rate for the preceding calendar year is more than 8.5 percent.

The Michigan Bureau of Employment Relations, Wage and Hour Division announced that the state’s scheduled minimum wage increase is not expected to go into effect on Jan. 1, 2021.

The state’s 2020 annual unemployment rate, determined by the U.S. Dept. of Labor’s Bureau of Labor Statistics, is calculated using both average labor force and unemployment levels for January through December.

Michigan’s October unemployment rate continued a downward trend and was 5.5 percent. But the annual average from January through October currently sits at 10.2 percent and is highly unlikely to dip below the 8.5 percent threshold by the time the bureau releases final 2020 unemployment numbers. If, as expected, the annual unemployment rate doesn’t dip below 8.5 percent, then, effective Jan. 1, 2021:

  • Michigan’s minimum wage will remain at $9.65 per hour.
  • The 85 percent rate for minors age 16 and 17 will remains $8.20 per hour.
  • Tipped employees’ rates of pay will remain $3.67 per hour.
  • The training wage of $4.25 per hour for newly hired employees age 16 and 17 for their first 90 days of employment will remain unchanged.

Michigan’s minimum wage rate will next increase to $9.87 in the first calendar year following a calendar year for which the annual unemployment rate is less than 8.5 percent.

More information is available at Michigan.gov/WageHour.

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