Last Minute Earned Sick Time Changes Michigan Employers Need to Know
Hours before the Michigan’s Earned Sick Time Act (ESTA) was set to take effect on February 21, 2025, the Michigan Senate and House passed major revisions. Those changes have officially been signed by the Governor. Here’s what Michigan employers need to know about these last minute changes to ESTA.
Check out our video recap for a deep dive into the changes.
Here are key updates Michigan employers need to know:
- Small business compliance delayed. Organizations with 10 or less employees now have until October 1, 2025 to implement their changes.
- Employee definition clarified. It excludes government workers, independent contractors, unpaid interns, and youth employees (ages 14 – 17).
- Front loading simplifies compliance for full-time employees — tracking or accrual is no longer required for full time employees if an employer front loads at least 72 hours.
- But prorated front loading for part-time employees still requires tracking to ensure they wouldn’t have accrued more than what was front loaded.
- Carryover limits introduced. Carryover can now be capped at 72 hours (large employers) and 40 hours (small businesses).
- Waiting period extended. Employers can have new employees wait 120 days to use sick time (up from 90 days).
- Rehire rules relaxed. Previously, employers had to reinstate sick time if rehiring within six months; now, they only need to reinstate it if rehiring within two months. This change, in particular, benefits employers of seasonal workers. Workers employed for fewer than 120 days are not entitled to use sick time.
- PTO integration allowed. Employers can use a single PTO bank if at least 72 hours are available for ESTA use.
- Employee lawsuits restricted. Civil suits must go through Michigan’s Department of Labor and Economic Opportunity (LEO).
- 30-day grace period for policy rollout. LEO is giving employers until March 23, 2025 to update and implement policies, but accrual still started on February 21, 2025.
Why it matters: Employers get more flexibility, especially with front loading and PTO policies, while compliance burdens (like tracking and carryover) are reduced. Small businesses have more time to comply, and seasonal employers may avoid coverage altogether.
Need help implementing these changes? We’re here to help. Contact our team of HR experts today.
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