DETROT ? Want to know what impact the increase in Michigan’s minimum wage will have on your business? Butzel Long, one of the state’s largest law firms, has summarized the potential consequences in a Legal Alert prepared by attorney Robert Boonin.
What are the unintended consequences?
As of October 1, the following employees ? who are currently exempt from being paid overtime ? may become eligible for overtime pay premiums:
Outside sales employees (i.e., sales employees who make sales by going to the customers? places of business);
Commissioned sales employees of retail and service establishments;
Car sales personnel and automobile mechanics will no longer;
Truck drivers who are USDOT regulated;
Domestic caregivers;
Doctors, lawyers and teachers who are not paid on salary basis;
Computer employees who are paid at least $27.63 per hour;
Newspaper delivery personnel;
Babysitters; and
Employees of small market newspapers and radio or television stations.
In addition, the ability to dock Michigan based salaried exempt employees for full day absences may be lost once the new minimum wage goes into effect.
Also, after October 1:
Hospitals will no longer be able to take advantage of the 8/80 rule available to them under federal law, and therefore will have to revert back to the traditional rule requiring overtime pay for all hours worked over 40 in a workweek;
Police and firefighters will lose their ability to accrue an extra 240 hours of compensatory time off, in lieu of being paid overtime.
What efforts are underway to correct this problem?
Currently, Butzel Long attorneys are actively involved in a coalition that is working towards obtaining a legislative solution to this problem. These efforts include obtaining a legislative correction that neutralizes the unintended consequences. The objective is to make sure that the minimum wage increase is limited to just increasing the minimum wage. Employer groups and others are contacting their legislators seeking a remedy. If our economy is to avoid a major disruption, the legislature must act before the end of the current legislative session.
How can employers assist in solving this problem?
Your involvement in the effort to ensure that the Michigan Legislature addresses this issue is encouraged. The more our state legislators hear from concerned employers and citizens, the better the chances are that ? despite the political issues involved during this election year ? the Legislature will take action in a timely manner. Please contact your legislators and the Governor?s office and ask them to fix this problem. Butzel Long?s attorneys have assisted employers, trade associations, and concerned citizens in preparing correspondence to their legislators. If you would like a template for a letter to communicate your organization?s concerns, please contact Robert Boonin, Miriam Rosen, or your Butzel Long attorney. Action is needed now to encourage legislators to support a bill that will likely be introduced in the near future.
Butzel Long?s attorneys are also available to assist employers in reviewing operations to prepare for compliance with the state overtime requirements if the Legislature does not correct the problem before October 1. There is not much time before the new rules go into effect, so this is one situation where employers should not sit back and hope for a legislative cure. Please look for updates on this issue on our Wage and Hour Information Center, Butzel.Com
This e-alert was prepared by Robert Boonin, a shareholder in the Labor and Employment Practice Group at Butzel Long. For additional information or if you have questions, please contact Robert A. Boonin or any Butzel Long labor and employment law attorney.
