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Michigan Governor Seeking to Make up to 200,000 More Workers Overtime Eligible

By Stephen R. Gee / Oct 28, 2019

Last week, Michigan Governor Gretchen Whitmer formally announced her intent to increase the white collar exemption salary threshold by more than the new federal threshold increase which was announced several weeks ago. If Governor Whitmer is successful in this endeavor, Michigan could see as many as 200,000 more workers overtime eligible. Gov. Whitmer’s newly-reorganized Department of Labor and Economic Opportunity (“LEO”) has filed a request for rulemaking to increase the state law salary threshold above $35,568 ($684 a week) for the bona fide executive, administrative, or professional overtime exemption (“EAP”). Gov. Whitmer has not yet specified what dollar amount she has in mind. Once the formal rulemaking process begins, it is expected to take between six to twelve months, during which Gov. Whitmer claims LEO officials will seek input from businesses and laborers before setting the new salary threshold.

Gov. Whitmer’s proposal adds Michigan to a growing list of states that have either already raised their overtime exempt salary thresholds above the new Federal minimum or are seeking to do so: California ($62,400 by 2022), New York (above $58,000 by the mid-2020s), Washington ($79,872 by 2026), Pennsylvania ($45,500 by 2022), Massachusetts ($64,000 by 2022), and Maine ($64,000 by 2022). Only Pennsylvania and Maine have yet to officially enact their plans.

Gov. Whitmer’s proposal will only proceed to formal rulemaking once the Michigan Office of Regulatory Reinvention (“ORR”) approves LEO’s request for rulemaking. It is unclear however when LEO officials plan to begin their outreach to Michigan businesses. Technically, Michigan employers are not entitled to review LEO’s proposed new salary threshold until after the ORR receives LEO’s draft rules and separately grants LEO approval to hold a public hearing on the draft rules. At that time, LEO’s draft rules will become available online through the formal notice of hearing. Michigan businesses can opt to directly contact LEO to request the notice of hearing be sent directly to them, either electronically or in writing.

Should you have any questions concerning labor or employment law matters, please contact Stephen R. Gee at sgee@clarkhill.com or any other member of Clark Hill’s labor and employment business unit team.