Michigan's paid sick leave story is one of the most legally dramatic in the country. In 2018, Michigan voters gathered enough signatures to put a paid sick leave initiative on the ballot — then the Republican-controlled legislature used a procedural tactic called "adopt and amend" to pass a weakened version of the law before the election, preventing the ballot measure from going forward. That weakened version — which only covered employers with 50 or more employees — became the law for years.
That changed when the Michigan Supreme Court ruled in Mothering Justice v. Attorney General (decided July 2024) that the adopt-and-amend maneuver was unconstitutional and ordered the original ballot-initiative language to take effect on February 21, 2025. Then came the twist that most online summaries miss: on that very morning, the legislature passed House Bill 4002 and Governor Whitmer signed it as Public Act 2 of 2025, effective immediately. So the Earned Sick Time Act (ESTA) that actually governs Michigan workplaces in 2026 is neither the 2018 ballot text nor the old 50-employee PMLA. It is the amended ESTA: every employer is covered, employees at employers with 11 or more employees can use up to 72 paid hours a year, and employees at small businesses (10 or fewer) can use up to 40 paid hours.
⚖️ Michigan Earned Sick Time Act — At a Glance (2026, As Amended)
The Legal History: Adopt-and-Amend, the Court Ruling, and the Same-Day Amendment
Understanding what the law actually says in 2026 requires a brief history lesson:
- 2018: Advocates gather signatures to put Proposition 18-1 on the ballot — a paid sick leave initiative covering all employers, providing up to 72 hours annually.
- September 2018: The Michigan legislature "adopts" the initiative before the election using the adopt-and-amend tactic — passing the initiative and then immediately amending it to a weaker version that only covered employers with 50+ employees and reduced the annual cap.
- 2019–2024: The weakened Paid Medical Leave Act (PMLA) governs Michigan. Employers with fewer than 50 employees have no obligation.
- July 2024: Michigan Supreme Court rules in Mothering Justice v. Attorney General that the adopt-and-amend tactic was unconstitutional under the Michigan Constitution's initiative process. The original 2018 initiative language is declared the valid law, with an effective date of February 21, 2025 to give employers time to prepare.
- February 21, 2025: ESTA takes effect and covers all Michigan employers. The same morning, the legislature passes House Bill 4002 and Governor Whitmer signs it as Public Act 2 of 2025, effective immediately. The amendment keeps universal coverage and the 72-hour entitlement for larger employers but reshapes the small-business rules (10 or fewer employees; 40 paid hours; no unpaid tier), allows a waiting period of up to 120 days for new hires, sets carryover caps of 72/40 hours, and formally blesses front-loading.
- October 1, 2025: The small-business runway ends. Employers with 10 or fewer employees must accrue, track, and provide paid sick time from this date.
The practical upshot: the "original 2018 ESTA" was law for a matter of hours. Every Michigan employer's obligations today flow from the amended text, which is what the rest of this guide describes.
What the Amended ESTA Requires in 2026
Under the amended Earned Sick Time Act, Michigan employees accrue 1 hour of paid earned sick time for every 30 hours worked, beginning on the first day of employment. Every hour that accrues is paid; the amendment eliminated the unpaid tier entirely. What changes with employer size is how many hours an employee can use in a year:
| Employer Size | Paid Sick Time (Annual Use Cap) | Unpaid Sick Time | Carryover Cap |
|---|---|---|---|
| 11 or more employees | Up to 72 hours | None required | 72 hours |
| Small business (10 or fewer employees) | Up to 40 hours | None required | 40 hours |
Who counts as a small business? An employer for which 10 or fewer individuals work for compensation in a given week, counting full-time, part-time, and temporary workers as well as people supplied through a staffing agency. An employer loses small-business status if it had more than 10 employees on payroll during 20 or more calendar workweeks in the current or preceding calendar year. Because the headcount includes temps and agency workers, an employer hovering around ten should assume it is on the 72-hour side unless it has checked carefully.
Accrual or Front-Loading
Employers have two ways to comply. The default is accrual: 1 hour per 30 hours worked, tracked in payroll, with unused hours carrying over. The alternative is front-loading: granting the full annual amount (72 hours, or 40 for a small business) at the start of the year for immediate use. An employer that front-loads does not have to track accrual or carry unused hours into the next year. Part-time employees may be front-loaded a pro-rated amount based on written expected hours, with a true-up if they work more.
The Optional 120-Day Waiting Period
The amendment lets employers require employees hired after February 21, 2025 to wait up to 120 calendar days after their start date before using accrued sick time. Hours still accrue during the wait; only use is delayed. Employees who were already on the payroll on February 21, 2025 cannot be made to wait. The waiting period is an employer option, not a mandate, so an employer that never wrote one into its policy cannot impose it after the fact.
The Small-Business Runway
Recognizing that most employers with 10 or fewer workers had never tracked sick leave under the old 50-employee PMLA, the amendment gave small businesses until October 1, 2025 to begin accruing, tracking, and providing paid sick time. That date has passed. As of 2026, a Michigan small business with no ESTA-compliant policy is out of compliance, and its employees have been accruing protected time since October 1, 2025 whether or not the employer tracked it.
What Michigan Employees Can Use ESTA Leave For
The amended ESTA allows use of earned sick time for a broad range of purposes:
- The employee's own mental or physical illness, injury, health condition, or preventive care
- Care for a family member (child, spouse, parent, grandparent, grandchild, sibling, or any other individual whose relationship to the employee is "like that of a family") who is ill or needs preventive care
- Absences related to domestic violence or sexual assault experienced by the employee or a family member — including medical care, legal proceedings, safety planning, and relocation
- Closure of the employee's workplace or a child's school/childcare due to a public health emergency
The "like family" language in the ESTA is deliberately broad — broader than most state sick leave laws. If an employee has a close personal relationship to someone who needs care, there is a credible argument that person qualifies under the ESTA's family definition.
Carryover and Year-End Rules
Unused ESTA leave carries over from year to year. Employers must allow carryover of up to 72 hours of unused paid sick time, or up to 40 hours if the employer is a small business, unless they choose a higher limit. Employers that track accrual cannot zero out accrued ESTA leave at year-end. Carryover does not expand the annual use cap, though: an employee at a larger employer who rolls 72 hours forward can still be limited to using 72 hours in the new year.
Employers that front-load the full annual entitlement at the start of each year are exempt from the carryover requirement for the front-loaded amount. Many Michigan HR professionals have found front-loading simpler to administer under the amended law, precisely because it removes both accrual tracking and year-end carryover math.
Vacation and PTO Payout at Termination
Michigan's ESTA does not require payout of accrued sick time at termination. For vacation and general PTO, the Payment of Wages and Fringe Benefits Act (PWFBA) treats vacation pay as a fringe benefit, and MCL 408.473 requires an employer to pay fringe benefits "in accordance with the terms set forth in the written contract or written policy." So a written promise of payout is enforceable — and, equally, Michigan has no default rule filling the gap when the written policy is silent. The remedy for a broken promise is set by MCL 408.488: the Department orders the wages or fringe benefits due plus a mandatory 10% a year on the amount from the time the employer is notified of the complaint, and may add exemplary damages of up to twice the amount if the violation is flagrant or repeated, plus a civil penalty of up to $1,000.
Because the written terms control, the risk for Michigan employers is less a silent policy than an unclear one. A policy that promises payout must be honoured; a policy that says unused vacation is forfeited is enforceable; a policy that says nothing creates no statutory payout duty, though an ambiguous one invites a dispute over what it promised. Write the separation rule down either way.
For Michigan Employers: Post-Restoration Compliance Priorities
- ☐ Determine your employee count, including temps and staffing-agency workers — are you an "11 or more" employer (72 hrs paid) or a small business with 10 or fewer (40 hrs paid, no unpaid tier)?
- ☐ Update all written PTO/sick leave policies to reflect ESTA as amended by Public Act 2 of 2025, effective February 21, 2025
- ☐ If you are a small business previously exempt under the PMLA, your compliance date was October 1, 2025 — if accrual tracking is not yet running, implement it now and reconstruct accrual from that date
- ☐ Decide whether to apply the optional 120-day waiting period to employees hired after February 21, 2025, and write it into the policy if so
- ☐ Train HR and managers on the broader "like family" definition and expanded qualifying uses
- ☐ Decide: per-hour accrual or front-load? Update payroll system accordingly
- ☐ Update termination process — clarify vacation vs. ESTA sick time payout separately in offboarding documentation
- ☐ Post the required ESTA notice — available from the Michigan Department of Labor and Economic Opportunity
Track Your Michigan Sick Time All Year
With up to 72 hours of earned sick time protected by law for Michigan workers (40 hours at small businesses), staying on top of your balance matters. Use our free calculator to track your accrual year-round.
Open the PTO Calculator →Final Paycheck Timing in Michigan
Michigan's final-pay rule is governed by the Payment of Wages and Fringe Benefits Act (Public Act 390 of 1978), and this guide had not stated it. The practical answer most Michigan employees will be held to is the one the Department of Labor and Economic Opportunity administers: wages earned and due are payable on the regularly scheduled payday for the period in which the termination occurs, whether the employee quit or was discharged. LEO applies the same rule to fringe benefits due at termination, unless a written contract or written policy says otherwise — which is the hook for the vacation-payout analysis earlier in this guide.
The payday deadline comes from the Department's own rule under the Act. The statute, MCL 408.475, sets the standard — an employer shall pay a departing employee "as soon as the amount can with due diligence be determined," and "immediately" on discharge. Mich. Admin. Code R 408.9007 turns that into a deadline: an employer "shall pay all wages due an employee who quits or is discharged … on the regularly scheduled payday for the period in which the termination occurs." Hand harvesters are the exception: under the statute, within 3 days of a voluntary quit; under the rule, within 1 working day of a discharge. An earlier version of this page said the statute and the Department's position could not be reconciled; the rule is what reconciles them.
Complaints for non-payment of wages or fringe benefits must be filed with the Wage and Hour Division within 12 months of the alleged violation.
Frequently Asked Questions
When must a Michigan employer issue my final paycheck?
On the regularly scheduled payday for the pay period in which your employment ended, whether you quit or were discharged. That deadline is set by the Department of Labor and Economic Opportunity's rule under the Payment of Wages and Fringe Benefits Act, Mich. Admin. Code R 408.9007; the statute itself (MCL 408.475) requires payment as soon as the amount can with due diligence be determined. Fringe benefits due at termination follow the written contract or policy. Complaints must be filed with the Wage and Hour Division within 12 months.
What is Michigan's Earned Sick Time Act?
Michigan's Earned Sick Time Act (ESTA) requires every Michigan employer, regardless of size, to provide paid sick time. The law took effect on February 21, 2025 after the Michigan Supreme Court's ruling in Mothering Justice v. Attorney General, and was amended the same day by Public Act 2 of 2025 (House Bill 4002). Under the amended act, employers with 11 or more employees must allow up to 72 hours of paid sick time per year, and small businesses (10 or fewer employees) must allow up to 40 hours of paid sick time per year. There is no unpaid-hours requirement.
When did the current Michigan ESTA take effect?
February 21, 2025. That is the date the Michigan Supreme Court set for the original ESTA to take effect, and it is also the date Governor Whitmer signed Public Act 2 of 2025, which amended the act with immediate effect. Employers with 11 or more employees had to comply from that day. Small businesses (10 or fewer employees) were given until October 1, 2025 to begin accruing, tracking, and providing paid sick time.
How does sick time accrue under the Michigan ESTA?
Michigan employees accrue 1 hour of paid earned sick time for every 30 hours worked, starting on the first day of employment. Employers with 11 or more employees must allow use of up to 72 hours per year; small businesses with 10 or fewer employees must allow up to 40 hours per year. Instead of tracking accrual, an employer may front-load the full annual amount (72 or 40 hours) at the start of the year for immediate use. Employers may require employees hired after February 21, 2025 to wait up to 120 calendar days after their start date before using accrued time.
Does Michigan require vacation payout at termination?
ESTA does not require payout of sick time at termination. For vacation or general PTO, MCL 408.473 requires fringe benefits to be paid in accordance with the written contract or written policy: if the policy promises payout, it is owed; if it is silent, Michigan law does not supply a payout duty. An employer that withholds promised vacation pay owes the amount plus 10% a year from notice of the complaint, and up to twice the amount again in exemplary damages if the violation is flagrant or repeated (MCL 408.488).
How did Public Act 2 of 2025 change the original ESTA?
The original 2018 initiative required 72 paid hours at employers with 10 or more employees, and 40 paid plus 32 unpaid hours at employers with fewer than 10, with a 90-day waiting period. Public Act 2 of 2025, signed February 21, 2025, redefined a small business as an employer with 10 or fewer employees, set the small-business requirement at 40 paid hours with no unpaid tier, allowed a waiting period of up to 120 days for employees hired after February 21, 2025, capped carryover at 72 hours (40 for small businesses), let employers front-load instead of tracking accrual, and gave small businesses until October 1, 2025 to comply.
Can Michigan employers use existing PTO policies to comply with ESTA?
Yes. If a Michigan employer already provides paid time off in at least the amounts required by ESTA (72 hours per year for employers with 11 or more employees, 40 hours for small businesses with 10 or fewer) and allows it to be used for ESTA's qualifying illness, injury, and family-care reasons, the existing policy satisfies the act. The leave does not need to be tracked in a separate ESTA bank as long as the policy meets the law's standards for accrual or front-loading, usage, and carryover.
Sources
- MCL 408.963 — Earned Sick Time Act § 3 (accrual, use caps, carryover, waiting period), as amended by 2025 PA 2
- MCL 408.473 — fringe benefits paid per the written contract or policy
- MCL 408.475 — payment on quitting or discharge
- Mich. Admin. Code R 408.9007 — final pay on the regularly scheduled payday
- MCL 408.488 — remedies: 10% a year, exemplary damages, civil penalty
- Public Act 2 of 2025 (House Bill 4002), approved February 21, 2025
- Michigan Department of Labor and Economic Opportunity — Earned Sick Time Act guidance and FAQs