Michigan is set to introduce significant changes to its sick leave regulations through the Michigan Earned Sick Time Act (ESTA), which takes effect February 21, 2025. This new law impacts all employers, making compliance preparation essential for businesses of all sizes.

Key Changes Under Michigan’s New Sick Leave Law

Who Is Covered?

• ESTA applies to all employers, except federal employers.
• Covers all employees, including full-time, part-time, and temporary workers.

How Sick Time Accrues

• Employees earn 1 hour of sick leave per 30 hours worked.
• Minimum accrual: 72 hours (40 hours paid, 32 hours unpaid for small employers).
• Sick time accrues from the first day of employment, but usage may be restricted for the first 90 days.
• No limit on carryover, but employers may set an annual usage cap equal to the accrual max.

Permitted Uses for Sick Leave

Employees can use their earned sick time for:

• Personal or family health needs, including illness, injury, or preventive care.
• Public health emergencies, such as business closures due to government orders.
• Domestic violence or sexual assault recovery, including seeking medical care, counseling, legal action, or relocation.
• School or childcare-related absences due to health concerns.

Employer Responsibilities for Compliance

Employers must:

1. Provide Employee Notice: Inform workers of their rights under ESTA.
2. Display Mandatory Posters: Place approved notices in the workplace.
3. Maintain Records for 3 Years: Track sick leave accrual and usage.
4. Prevent Retaliation: Protect employees from adverse actions for using their earned sick time.

How Small vs. Large Employers Are Affected

• Large Employers (10+ employees): Must provide 72 hours of paid sick leave.
• Small Employers (<10 employees): Required to offer 40 paid hours + 32 unpaid hours.
• Employers with multi-state operations must determine state-specific compliance for Michigan employees.

Common Questions About Michigan Sick Leave Policy

Do Employers Have to Pay Unused Sick Leave Upon Termination?

No, the law does not require payout of unused sick leave unless company policy states otherwise.

How Do Salaried Employees Accrue Sick Time?

Sick time accrues based on a standard 40-hour workweek, unless the employee works more.

Can Employers Frontload Sick Leave?

Yes, but it must be prorated for mid-year hires.

Do Businesses with PTO Policies Need to Offer Additional Sick Leave?

If an employer’s PTO policy meets ESTA requirements, separate sick leave may not be required.

Upcoming Changes to Michigan Sick Leave Rules

Legislators are considering potential amendments, such as:

• Exempting small businesses with fewer than 10, 25, or 50 employees.
• Introducing carryover limits or changes to frontloading rules.
• Delaying implementation to provide more preparation time for businesses.

Next Steps for Employers

With Michigan’s sick leave law taking effect in 2025, now is the time for businesses to:

• Review existing policies and update them for compliance.
• Educate HR teams and managers about employee rights and sick leave usage.
• Monitor legislative updates for any potential changes before the implementation date.

For further guidance, consult an HR expert or legal advisor to ensure smooth adaptation to Michigan’s new sick leave law.he legal challenges 2025 may bring. 

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