Small Businesses Optimistic Following Supreme Court Hearing on Paid Sick Leave and Minimum Wage Challenge

The National Federation of Independent Business, the state’s leading small business organization, is optimistic after a Michigan Supreme Court hearing today on last year’s action by the legislature to adopt and make changes to two ballot initiatives.

The hearing was to determine if the Court should rule on the constitutionality of legislative changes to the Paid Sick Leave and Minimum Wage ballot proposals that were made during the end of last year’s legislative session.

“While it remains to be seen how the Court will ultimately decide, we feel that our attorneys, and the attorneys representing the legislature, made a stronger argument on the legal basis that supports the legislature’s action,” said NFIB State Director in Michigan, Charlie Owens. “It was clear that the opposition’s arguments seemed to be based more on emotion and opinion than legal fact.”

The issue is whether the Michigan Constitution allows the legislature to adopt, and then amend, a ballot initiative in the same session. NFIB and the Small Business for a Better Michigan coalition had previously filed amicus briefs on both the Paid Sick Leave and Minimum Wage changes with the state Supreme Court asking them to address any question of constitutionality in the legislature’s actions. The briefs were in support of resolutions passed by the House and Senate that also asked for an immediate advisory opinion.

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NFIB and the Small Business for a Better Michigan coalition were successful in persuading the legislature to adopt and make changes to two ballot initiatives that would have imposed the most stringent paid sick leave and minimum wage employer mandate in the country. The changes supported by NFIB included an exemption from the paid sick leave mandate for an employer with less than 50 employees.

Owens said that if the high court were to find that the legislature’s action was unconstitutional, it would result in confusion and chaos for hundreds of thousands of Michigan small business owners.

“In the case of the Paid Sick Leave mandate, those businesses that are currently exempted (less than 50 employees) will suddenly find themselves required to comply with the extreme and complicated ballot proposal version of the law,” said Owens. “Regarding the minimum wage changes, a negative decision by the court would raise the current minimum wage from $9.45 to $10.00 an hour for 2019 and $10.65 in 2020. The tip credit would also be eliminated on a scheduled basis.”