Gongwer
Aug. 13, 2024
Liz Nass
State Treasurer Rachael Eubanks said she is seeking guidance from the Department of Attorney General on the adopt and amend Supreme Court ruling, requiring her agency to calculate an inflation-adjusted minimum wage, following a presentation with the Detroit Regional Chamber on Tuesday.
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The adopt and amend ruling, decided last month, held the Legislature cannot adopt and later amend voter-initiated laws in the same session. That led to the reinstatement of a law calling to increase Michigan’s minimum wage to $12 per hour by 2022 and bring tipped minimum wage up to the regular minimum wage.
The court decision now requires a revised schedule for the phase-in of minimum wage increases to account for inflation and the years that have passed since the original law would have taken effect. The current minimum wage is $10.33 for non-tipped workers and $3.93 for tipped workers.
Eubanks said that although the court requires Treasury to implement the changes by November, the department is looking for clarification from the attorney general on “a technical standing” of what the wording in the court decision means to figure out a calculation as the court intended.
Eubanks said the department is not close to looking at an actual number or rate yet to adhere to the changes.
As for the implications on revenue in the state, Eubanks said the department is still studying the calculations in the instructions of the court decision, and needs to evaluate the court decision’s effects on the Michigan economy overall at the January Consensus Revenue Estimating Conference.
“Right now, I’m keeping an open mind about it,” Eubanks said. “Could it be no impact? Could it be an increase? Could it be a decrease? It’s too soon to say.”
Eubanks noted the effects to the state could come from two sides: its position as an employer but also with increased withholdings.
Budget Director Jen Flood said initial estimates show the impact to the state as an employer will be “minimal.”
Flood said the administration is working with the Department of Labor and Economic Opportunity in how to enforce this distribution of changing minimum wage, as well as helping employers with “navigating the complex policy.”
“The administration’s take is, how do we support employers through this transition?” Flood said.