Michigan Labor Laws - The Complete Guide for 2026 - 2027

Operating a business in Michigan comes with some key compliance requirements that employers need to adopt a strong understanding of in order to avoid certain challenges, or worse.

Here is everything employers need to know about labor laws in Michigan:

Overview of Labor Laws in Michigan

Michigan labor laws cover the following key areas:

• Hiring Laws
• Wage & Hour Laws
• Child Labor Laws
• Leave Laws
• Workplace Health & Safety Laws
• Discrimination Laws
• Workers’ Compensation Laws
• Unemployment Insurance Laws
• Recordkeeping and Posting Requirements

Michigan Hiring Laws

Michigan hiring laws primarily revolve around new hire reporting.

Michigan New Hire Reporting

Michigan employers are required to report details on newly hired, or rehired, employees to the Michigan Office of Child Support (OCS) through the Michigan New Hires Operation Center.

Reporting must be completed within 20 days of the date of hire.

This information is used in child support cases to help locate parents, establish court orders for support, or enforce existing support orders.

Employers will need the following employer and employee information:

• Employee information:
  • Full legal name
  • Home address
  • Social Security Number (SSN)
  • Date of birth
  • Date of hire (first day services performed for pay)
• Employer information:
  • Business name
  • Business address
  • Federal Employer Identification Number (FEIN)

Michigan “Ban-the-Box” Law

While Michigan does not have a statewide “Ban-the-Box” law for private-sector employers, the state does have a “Ban-the-Box” law for state job applications. Specifically, the law removes the question “Have you been convicted of a felony?” from applications.

With the passing of the law in 2018, private-sector employers have been encouraged (not required) to also remove these questions from applications.

Michigan Wage & Hour Laws

Michigan wage and hour laws include topics such as minimum wage, overtime, and equal pay.

Michigan Minimum Wage

Michigan minimum wage is established by the Improved Workforce Opportunity Wage Act (IWOWA). The state includes minimum wage rates for tipped workers, minors, employees in training, as well as a standard rate for all other workers in the state.

Michigan minimum wage can be broken down as follows:

• Standard Rate: $13.73 per hour (effective January 1st, 2026)
• Tipped Rate: $5.49 per hour (40% of the standard minimum wage rate)
  • Employees must receive and report an average of at least $8.24 per hour in tips (effective January 1st, 2026)
• Minor Rate: $11.67 per hour (85% of the standard minimum wage rate)
  • Employees must be under the age of 18
• Training Rate: $4.25 per hour
  • Only for employees under 20 years of age for the first 90 calendar days of employment

Michigan Overtime

Also covered under the IWOWA, employers must be compensated at 1.5 times their normal rate of pay for all hours worked over 40 in a workweek.

There are certain exceptions, but generally employees not covered by the IWOWA are subject to Fair Labor Standards Act (FLSA) overtime rules.

Exemptions include:

• Employees exempt from the minimum wage provisions of the FLSA
• Professional, administrative, or executive employees
• Elected officials and political appointees
• Employees of amusement and recreational establishments operating less than 7 months of the year
• Agricultural employees
• Any employee not subject to Michigan minimum wage provisions

Michigan Payroll Deductions

Michigan’s Payment of Wages and Fringe Benefits Act (PWFBA) establishes regulations for employers taking legally authorized and voluntarily agreed-upon deductions from employee pay.

Common deductions in Michigan include:

• Income tax withholdings
• Social Security and Medicare taxes
• Certain meal, housing, and transportation expenses
• Debts owed to the employer, like for pay advances, loans, or misappropriated funds
• Court-ordered wage garnishments
• Debts owed to the government
• Child support and alimony

The law specifies that employers may deduct for overpayments of wages or fringe benefits due to mathematical or typographical errors under special conditions.

Michigan Pay Stub Requirements

The PWFBA also requires employers to provide employees with a retainable pay statement.

These statements must include the following information:

• Hours worked
• Gross wages paid
• An itemization of deductions
• The dates for which the wages are paid

Michigan Paycheck Delivery Requirements

Michigan employers are required to deliver employee paychecks using one of the following methods:

• Direct deposit
• Cash
• Check
• Money order

Michigan Wage Payment Schedules

Also governed by the PWFBA, Michigan employers are required to pay employees on one of the following pay frequencies: 

• Weekly
• Bi-weekly
• Semi-monthly
• Monthly

Michigan Final Pay

Employers are required to deliver final paychecks to employees on the next regularly scheduled payday for the last pay period the employee worked before quitting or otherwise being terminated.

Michigan law does not require employers to pay out fringe benefits (unused PTO, etc,) upon termination, but employers are required to honor any agreements to do so made during employment or upon hiring.

Meal and Rest Break Requirements in Michigan

There are no state laws requiring meal and rest breaks in Michigan.

However, the state does follow federal requirements, which generally state:

• Short breaks (5 to 20 minutes) must be paid by the employer.
• Meal breaks (30 minutes or longer) may be unpaid as long as the worker is completely free from all job duties. If an employee must stay on call or answer phones during lunch, that time must be paid.

Michigan Child Labor Laws

Michigan child labor laws are established under the Michigan Youth Employment Standards Act (YESA), and cover key areas such as:

• Hours and break requirements
• Work permits
• Prohibited activities
• Supervision requirements
• Posting and recordkeeping

Hours & Break Requirements

Michigan employers are required to track hours worked to ensure compliance, and should be aware of the following key restrictions:

• Daily and weekly hour limits for workers under the age of 16
• Hour limits for workers ages 16 and 17
• Required meal and rest breaks depending on hours worked

Work Permits

In order to work in the state, minors must obtain a valid work permit through the State of Michigan’s centralized work permit system, overseen by the Wage and Hour Division, as of October 1st, 2026.

School officials must still approve and then issue the permit, which must list the specific employer and job. 

Prohibited Activities

Employers are responsible for ensuring that minors do not perform certain dangerous tasks.

Examples include:

• Operating certain power-driven machinery
• Using meat slicers
• Working with hazardous chemicals
• Operating certain hoisting or heavy equipment

Supervision Requirements

In Michigan, employers must have an employee who is 18 or older working at all times, supervising any minor employees while working. 

Posting & Recordkeeping

Employers are required to post YESA notices in an easily accessible location in the workplace at all times.

Employers are also required to maintain accurate time records for each employee, as well as keep work permits on file.

Michigan Leave Laws

Apart from compliance with the Federal Family and Medical Leave Act (FMLA), the only type of mandated leave in Michigan is that which is established by the Michigan Earned Sick Time Act.

Michigan Sick Leave Law

The Michigan Earned Sick Time Act (ESTA) covers all employers in the state that have one or more employee(s), including any person, firm, business, educational institutions, corporations, limited liability company, government entities, excluding the United States Government.

Covered employers are required to provide paid sick leave to all employees.

All employers must adhere to the following requirements:

• Employees must be able to accrue one hour of paid sick leave for every 30 hours worked. Employers may choose to frontload hours instead.
• Employers may implement a waiting period of up to 120 days before employees may use paid sick leave. However, this is not required.
• Employers may not require employees to search for or secure a replacement worker as a condition for using earned sick leave.
• Employers may restrict the use of paid sick leave to the purposes or reasons outlined by the ESTA.
• Employers must compensate employees at their normal rate of pay for any paid leave time under this law, or the applicable minimum wage rate, whichever is greater.

There is one key difference in requirements that is dependent on the size of the employer, relating to implementing limits on how much paid sick leave an employee may use in a calendar year:

• Employers with 10 or fewer employees: Employers may limit paid sick leave use to 40 hours per calendar year at a minimum.
• Employers with 11 or more employees: Employers may limit paid sick leave use to 72 hours per calendar year at a minimum.

Employers may choose to implement higher limits than those outlined by the law, but no less than 40 and 72 hours, respectively. 

Michigan Workplace Health & Safety Laws

Workplace safety regulations are established and administered by the Michigan Occupational Safety and Health Administration (MIOSHA).

Specifically, MIOSHA has adopted standards for:

• Administration
• Agriculture Operations
• Construction Safety and Health
• General Industry Safety and Health

Michigan Discrimination Laws

Apart from Federal Anti-Discrimination Laws for employers, Michigan businesses must maintain compliance with the Elliott-Larsen Civil Rights Act, as well as Equal pay provisions under the IWOWA.

Elliott-Larsen Civil Rights Act

The Elliott-Larsen Civil Rights Act establishes key requirements and regulations to prohibit and prevent discrimination in employment in the state of Michigan.

That act includes key provisions regarding:

• Protected Classes
• Prohibited Practices
• Exceptions
• Specific Industry / Business Type Regulations

Michigan Equal Pay Law

Under the IWOWA, employers are prohibited from discriminating against an employee on the basis of sex when it comes to compensation for jobs requiring equal skill, effort, and responsibility performed under similar working conditions.

Any disparities in pay must be able to be proven as a result of a seniority system, merit system, another system measuring earnings on the basis of quantity or quality of production, or any other differential other than sex.

Michigan Workers’ Compensation Laws

Workers’ Compensation in Michigan is administered by the Michigan Department of Labor and Economic Opportunity, Workers’ Disability Compensation Agency, and generally covers most employees.

Employers covered by the Michigan Workers' Disability Compensation Act are required to provide some way of assuring that benefits are paid to their workers if they become injured while on the job. Generally, this is done by obtaining a Workers’ Compensation Insurance Policy.

Who Is Covered?

Most employers are covered by the Workers' Disability Compensation Act. Exceptions include:

• Federal government employees
• Interstate railroad workers
• Seamen on navigable waters
• Longshore and harbor workers

Workers' Compensation Benefits

Employees who are disabled, or die as a result of a work-related injury or disease, must be compensated with benefits paid by the employer, either directly or through an insurance carrier.

Benefits can include:

• Wage Loss Benefits
• Vocational Rehabilitation
• Lump Sum Advance and Redemption Settlement

Michigan Unemployment Insurance Laws

The Michigan Unemployment Insurance Agency (UIA) establishes and administers the unemployment insurance program for the state. Employers with covered employees are required to register for an employer account.

Michigan has one of the more complex unemployment insurance tax rates in the country. While new employers have a standard rate of 2.7% for the first two years of liability, the rate changes in the third, fourth, and fifth years of liability.

For some employers, the unemployment tax rates can be challenging to calculate. Consider reaching out to a Michigan Payroll Company with experience in handling state taxes for help.

UI Benefits

The current maximum weekly benefit is $530 per week, while the dependent benefit rate is $19.99, up to five dependents.

Effective January 1st, 2027, these rates will increase to $614 and $26, respectively.

Recent Updates

Effective July 2026, the following updates took place regarding Michigan unemployment insurance:

• Increased Work Search Requirement: Residents must now complete at least 3 work searches each week to continue receiving benefits.
• Domestic Violence Victim Expansion: Employees who left jobs due to domestic violence or for the safety of a member of their household may now qualify for unemployment benefits.
• Updated Work Share Requirements: Employers participating in Work Share Programs can now reduce weekly hours between 10% and 60% to qualify, instead of previously being restricted to a reduction between 15% and 45%. Work Share programs allow employers to keep employees on payroll while allowing them to collect partial UI benefits.
• Appeal Hearing Consolidation: Employers facing multiple related appeal issues may now request to have one combined hearing instead of multiple.

Michigan Recordkeeping and Posting Requirements

Michigan employers must maintain certain records and workplace posters / notices in order to maintain compliance.

Michigan Recordkeeping Laws

Michigan employers are required to keep general payroll and wage records for up to three years. This includes:

• Employee Details: Name, address, birth date, and occupation / classification.
• Payroll and Time Details: Total hours worked per day and week, gross wages, and net pay per pay period.
• Deductions and Benefits: Itemized list of wage deductions and fringe benefits.

Employers must also keep the following tax, unemployment, and safety records:

• Unemployment Insurance Records: Six years
• Tax Documents: Four years
• Injury Reports: Five years from the date of injury
• Safety Logs: Maintain occupational injury and illness records for five years

Employers are also required to maintain accurate time records for each minor employee, as well as keep work permits on file, so long as the minor is employed (and stays a minor).

Michigan Posting Requirements

Employers in Michigan are generally required to display the following state labor law posters, in addition to any federal posters or notices:

• Michigan Safety and Health Protection on the Job
• MIOSHA Log 300 Forms (annual summary of injuries and illnesses)
• SDS Location Poster and SDS New & Revised Poster (employers that have hazardous chemicals)
• Michigan Whistleblowers Protection Act
• Minimum Wage and Overtime (WHD 9904)
• Michigan Discrimination Law
• Youth Employment
• Michigan Employment Security Act Notice to Employees (regarding unemployment compensation)

Final Thoughts on Michigan Labor Laws

Michigan compliance requirements can prove challenging for employers to manage on their own, especially when it comes to regulations regarding payroll, paid sick leave, and unemployment insurance taxes.

Many businesses are turning to a trusted Michigan Payroll Company with experience in local and state regulations and requirements for help.

To learn more about how the right provider can help your business, contact us today. Or, get started now and find a provider.

Guest Author: Eric Jones

Eric Jones is President of Workforce PayHub, a Michigan payroll services company, and and graduated from Siena Heights University with a BA in accounting and Cleary University with a Master of Business Administration. He has extensive knowledge in HCM & payroll platforms, payroll tax management and specializes in consulting on time and attendance for a wide range of industries. Mid-2022 he moved with his family to a homestead on 15 acres and is trying his hand at gardening and raising animals. In his free time, Eric likes to spend time with his wife and 7 children. He is very active in his Church and acts as the business manager for his previous Parish.