CLIENT ALERT: Michigan’s New Earned Sick Time Act

Feb 21, 2025

Client Alert: Changes To Michigan’s Paid Medical Leave Law

 

What you need to know

Michigan lawmakers finalized and passed an amended paid sick leave bill just hours before the Earned Sick Time Act (ESTA) was set to take effect. HB 4002 – which took effect upon Governor Whitmer’s signature this afternoon – brings Michigan up to par with some of the most generous sick leave laws nationwide. Irrespective, HB 4002 rolls back some of the most onerous requirements of the prior ESTA.

 

Key Highlights

  • The new paid sick leave act will take effect immediately.
  • Small businesses (10 or fewer employees) have until October 1, 2025, to implement changes required by the law.
  • New small businesses have a three-year grace period.
  • HB 4002 eliminates the unlimited carryover requirements of the ESTA, providing annual caps.
  • HB 4002 eliminates the ability for aggrieved employees to file a private civil action; the sole remedy is within the Department of Labor and Economic Opportunity.
  • HB 4002 clarifies that employers who “front load” PTO for employees may dispense with the need to accrue or rollover PTO.

 

What’s Changing: HB 4002

The table below maps out key policies and requirements changes over the prior Earned Sick Time Act.

 

key policies and requirements changes over the prior Earned Sick Time Act

 

Key Takeaways for Employers

Employers must prepare to update their sick leave policies and handbooks to comply with HB 4002. Smaller businesses that were previously exempt under the prior Paid Medical Leave Act will need to implement systems for tracking accrual and use of sick leave. It will also be essential to review existing front-loading practices and documentation requirements to ensure they align with HB 4002’s more flexible approach. Lastly, employers should consider training management in compliance and best practices in leave administration.

 

Action Items

  1. Audit and Update Policies: Ensure current paid leave policies align with the new requirements, including accrual rates, usage caps, and roll-over provisions.
  2. HR Training: Educate HR staff and management on new enforcement standards.
  3. Employee Communications: Notify employees of their expanded leave rights.

 

For further guidance or assistance in preparing for these changes, please contact our Employment Law team.