Michigan House Bill HB4492

Michigan 2025-2026 Regular Session

• Introduced: 5/13/25
• Refer: 5/13/25

Caption

Labor: hours and wages; sharing gratuities with other employees; allow an employer to require. Amends sec. 4d of 2018 PA 337 (MCL 408.934d).

Impact

If enacted, this bill will have a significant impact on labor laws in Michigan, particularly affecting employees who earn tips. The structured wage increases outlined in the bill suggest a gradual approach to aligning the minimum wage for tipped workers with standard wage levels. For instance, starting from February 21, 2025, the bill mandates that minimum wage for such employees shall be set at 38% of the established minimum wage, incrementally increasing to 50% by January 1, 2031. This could enhance income predictability for workers relying on gratuities, as it requires clear documentation and consent from employees regarding wage structures.

Summary

House Bill 4492 aims to amend the Improved Workforce Opportunity Wage Act by introducing specific provisions regarding the minimum hourly wage for employees who receive gratuities. The bill stipulates that employers may establish a reduced minimum wage for these employees, contingent upon certain conditions. Key among these conditions is that the gratuities received must equal or exceed the difference between the minimum wage and the regular wage established under Section 4. This legislative change is intended to clarify the relationship between gratuities and wages for employees working in industries reliant on tips, such as the restaurant and hospitality sectors.

Contention

Notably, the bill raises potential points of contention regarding employer requirements around gratuity distribution. Employers will have the option to require employees receiving gratuities to share them with other staff, which may lead to debates about fairness and employee autonomy. Critics may argue that this could disadvantage individual workers who rely heavily on tips, especially in competitive service environments. Furthermore, the requirement for written employee consent at the time of hire regarding the gratuity sharing policy may spark discussions about worker rights and the extent of employer control over compensation structures.