The Michigan Earned Sick Time Act (ESTA), a revised sick leave law, is set to go into effect on February 21st, 2025. It will have an immediate impact on any business that employs one or more full-time or part-time employees. The ESTA requires the employer to accrue sick time for each employee as of the effective date of the law, or the beginning of their employment, whichever is later, and it permits the carryover of the earned but unused sick time from year to year. Employers are required to retain and make available to Michigan’s Department of Labor & Economic Opportunity – Wage and Hour Division records of the hours worked and the paid sick time used by employees, if requested; these records must be maintained for a minimum of three years.
Regardless of a business’ size, employees accrue sick time at the rate of one hour for every 30 hours worked. There are stipulations that affect employee use of this sick time, depending on the size of the employer. Businesses with less than 10 employees must allow the use of accrued paid sick time per employee of 40 hours and an additional 32 hours of unpaid sick time annually. Businesses with 10 or more employees must allow the use of accrued paid sick time of up to 72 hours per year. If a business employs 10 or more employees in 20 or more workweeks (workweeks do not have to be consecutive) in the current or previous year, they are considered part of the “10 or more employees” category. For businesses with less than 10 employees, employees must be allowed to use their 40 hours of accrued paid sick time before utilizing the unpaid sick time.
According to the ESTA, employees may use sick time as it is accrued. It may be used for the mental or physical health of the employee or their family members, meetings at their child’s school related to their health or disability, closures of school or childcare needs related to a public health emergency, and matters related to domestic or sexual assault of the employee or their family members. The employee additionally cannot be required to find a replacement worker in order to use earned sick time.
It is important to note that this 72-hour total sick time requirement is simply an annual minimum imposed by the state of Michigan for full-time employees who accrue to this total. Employers are allowed by the ESTA to accrue more than 72 hours for employees, as well as allow them to utilize more than 72 hours in a 12-month period.
In addition, according to the ESTA, employees may use sick time in the smallest increment of time used by the employer’s payroll system for absences of use of other time. Employers are not required to pay unused earned sick time upon termination of employment unless it’s stated in their policy. The employer may not pay out unused sick time annually in lieu of carrying forward unused hours to the next year. Employers must maintain confidentiality of information provided by the employee as it relates to sick time used.
For general requirements of Michigan’s ESTA, follow this link to the one-page poster published by the Department of Labor & Economic Opportunity: Earned Sick Time Act – Required Poster
Here is a link to frequently asked questions posted on the State of Michigan’s website: Earned Sick Time Act FAQ
As impacts of the new law can vary by situation, and AHP is not in the practice of law, we advise you to consult with your employment attorney to determine your specific business obligations regarding accrued and paid sick time to ensure that your policies comply with the new law that is set to take effect.
