Happier holidays ahead for workers
The Michigan League for Public Policy has a running wish list of policy changes that will better serve workers and their families in the state, and, as the year comes to a close, we wanted to take a look at of some of the wins Michigan’s executive branch has delivered.
The changes have not come quickly or easily, but Gov. Gretchen Whitmer and Attorney General Dana Nessel have brought a noticeable and necessary shift in how workers are treated in the Alpena area and across Michigan.
In 2016, the Barack Obama administration implemented a rule change that would have raised the annual salary threshold below which workers must be paid mandatory overtime pay when they work more than 40 hours in a week, from $23,700 to $50,400. Unfortunately, the rule never went into effect, having been held up in court following a challenge by Michigan’s then-attorney general, Bill Schuette, and several other state AGs.
Then-Gov. Rick Snyder was mum on the issue.
In 2017, a report found that, from 2013 to 2015, approximately 130,000 Michigan workers experienced minimum wage theft, with an average underpayment of $2.05 per hour (or $3,300 if for a full year).
Examples of wage theft include paying workers less than the legal minimum wage, failing to pay overtime, requiring employees to work off the clock, denying workers their meal breaks, taking illegal paycheck deductions, and misclassifying employees as independent contractors to pay a wage lower than the legal minimum.
Again, at that time, there seemed to be little appetite from the attorney general to put resources and energy into pursuing payroll fraud cases and from the governor to make policy changes to address the problem.
The good news is that times have changed with new state leadership.
Michigan now has a governor and attorney general who stand up for the well-being of workers. In April of this year, Nessel announced the creation of a payroll fraud enforcement unit within the Attorney General’s Office to investigate worker claims of wage theft and employee misclassification.
In August, she stood with lawmakers to endorse a bill package that would strengthen laws against payroll fraud and provide protections for whistleblowers who report it.
And, this past October, following heavy advocacy by the League and other organizations, Whitmer announced that, in the absence of the Donald Trump admitstration’s adoption of the Obama overtime rule, her Department of Labor and Economic Opportunity will be raising Michigan’s overtime threshold higher than the national threshold. The level of the threshold will be decided after discussion with labor and business stakeholders around the state.
The governor’s announcement is important, because, while Trump framed his increase of the overtime threshold to $36,000 as a win for workers, it actually leaves out approximately 200,000 Michigan workers who would have been covered under the Obama rule.
Workers earning between $36,000 and $51,000 can be made to work 50, 60, or even more hours a week without receiving the time-and-a-half that nine out of 10 Michiganders support as a right.
So, this holiday season, we hope you will join the League in expressing our gratitude that the executive branch in this state is committed to improving the lives and livelihood of Michigan workers. That is sure to continue in the year ahead, and let’s hope legislative leadership will follow suit and do their part, too.
Peter Ruark is senior policy analyst at the Michigan League for Public Policy.