State Rep. Mike Harris and the Michigan House of Representatives on Thursday approved plans to protect Michigan workers and small businesses by preserving the tipped wage and maintaining flexible paid sick leave options ahead of a fast-approaching deadline.

The House approved the priority legislation with bipartisan support. Last week, the bills passed unanimously out of the Select Committee to Protect Michigan Employees and Small Businesses after hours of testimony from workers and local business owners who pleaded for a fix to the Michigan Supreme Court’s decision that will harm their livelihoods. Three business owners from Harris’ Oakland County district joined Harris to attend a committee hearing and show their support for the House bills.

“I stand with the hard-working people of Oakland County, and today, my colleagues and I are protecting their livelihoods before it’s too late,” said Harris, R-Waterford. “Since the activist Supreme Court decision came out last summer, I’ve heard from countless workers and small-business owners in our community about how the end of the tipped wage and the start of counterproductive sick leave rules will bring layoffs and pay cuts to Michigan workers.”

Harris urged the Democrat-majority Senate to pass the bills swiftly before the Michigan Supreme Court decision imposing new restrictions on workers and small businesses takes effect on Feb. 21.

 “Without our bipartisan plan, doomsday is coming on Feb. 21 for Michigan workers — threatening their pay, their benefits, and their jobs,” Harris said. “The coming elimination of the tipped wage will cause skyrocketing menu prices and plummeting tips for the servers who make well above minimum wage. And the one-size-fits-all sick time mandates will rob workers of flexible time off options, wrap confusing red tape around small businesses, and force small businesses to cut workers’ pay and benefits to make up for the steep costs of compliance. House Republicans have heard from dedicated Michigan workers who want help now, and it’s time for the Senate to get on board and help us get this done.”

Without a legislative fix, the court decision is slated to eliminate the tipped wage and impose a confusing, one-size-fits-all earned sick time mandate that will take away generous, flexible time options from workers while forcing mom-and-pop shops to hire new HR employees just to manage the convoluted sick time system.

House Bill 4001 preserves the tipped wage option (also known as the tip credit) — the wage structure that allows restaurant servers, bartenders, and other tipped workers to have some of their tips count as part of the minimum wage. This wage option keeps menu prices lower and thus incentivizes larger tips. As a result, most tipped workers earn far above minimum wage with their tips.

House Bill 4002 will fix the Supreme Court’s changes to the Earned Sick Time Act by providing clarity and flexibility so Michigan workers can keep good pay, benefits, and time off. The impending sick time regulations are so complex that small businesses will have to hire new workers just to track the use of sick time; this investment will mean less available money for workers’ wages and health care benefits. The coming sick time mandate will also make employees worse off by eliminating flexible paid time off arrangements and reducing vacation time for many employees. Even more confusing is the restriction that prevents businesses from frontloading sick time at the beginning of every year so employees will have it when they need it, without waiting for sick time to accrue.

By clarifying the confusing rules, eliminating the myopic one-size-fits-all approach, and ensuring flexible options, HB 4002 will prevent out-of-control compliance costs that are currently scheduled to reduce worker pay and benefits and strip workers of more flexible time off arrangements. By ensuring that only businesses with 50 or more employees are required to provide sick leave that meets the law’s parameters, the plan will also help ensure smaller businesses are not forced to lay off workers or close by mandates they cannot afford to navigate.

The Democrat majority failed to address this issue in 2024, but House Republicans made the issue a top priority to safeguard the jobs, pay, and benefits of Michigan workers ahead of the Feb. 21 deadline.

HB 4001 passed by a vote of 63-41, and HB 4002 passed by a vote of 67-38. The bills now advance to the Senate for consideration.