What Are Michigan’s Paid Sick Leave Laws in 2025?

Following a state Supreme Court ruling that repealed the 2019 Paid Medical Leave Act (PMLA), Michigan enacted the Earned Sick Time Act (ESTA), replacing the narrower provisions of the old law with more robust benefits and coverage for employees.

The new and improved ESTA became effective on February 21, 2025, and requires nearly all employers in the state to offer paid sick leave.

In this guide, we’ll break down what you need to know about Michigan’s paid sick leave laws—so you can understand your responsibilities as an employer, apply the rules correctly, and stay fully compliant with legal requirements.

Understanding paid sick leave in Michigan

The Michigan paid sick leave law requires nearly all employers with one or more employees to provide paid sick time to eligible workers, which they can use to address their health needs or those of family members.

Compared to the PMLA it replaces, the law under the ESTA has broader provisions. It expands coverage to all employees, except those employed by the US. government, whereas the previous law applied only to employers with 50 or more employees.

Also, the ESTA relies on a more generous definition of an employee, which broadens eligibility to cover previously exempted workers, including remote, seasonal, and part-time employees.

The ESTA is the only applicable law regulating paid leave statewide, and local governments in Michigan are precluded from passing their own sick leave ordinances.

Find out how sick leave laws differ by state.

Which employers must provide paid sick leave?

Any person, business, organization, educational institution, limited liability company, or government entity other than the US government, with one or more employees in Michigan, must offer paid sick leave.

This applies regardless of the employer’s size. However, the amount and type of sick leave an employer is obligated to provide varies depending on whether they are a small or large business.

Under the ESTA, a small business is one that has 10 or fewer individuals on its payroll nationwide during any 20 or more work weeks in the current or previous calendar year. Once the 10-employee threshold has been exceeded for 20 or more work weeks in the current or prior year, the employer will cease to be a small business until it requalifies.

Employers' paid sick time obligations in Michigan are as follows, based on business size:

• 11 or more employees: Employers must provide up to 72 hours of paid sick leave
• 10 or fewer employees: Employers must provide 40 hours of paid sick leave and 32 additional unpaid hours

Multistate employers must apply Michigan’s ESTA rules to employees who are:

• Physically located in Michigan
• Based in Michigan but sent to work out of state by the employer
• Earning 50% of their compensation for time spent working in Michigan
• Employed for a Michigan-based job, even though they reside elsewhere

Who isn’t covered?

The ESTA excludes fewer employees from qualifying for paid sick leave than under the old PMLA, but some remain exempt, including:

• Federal employees
• Unpaid trainees and interns
• Certain railroad and airline industry workers who are covered by federal law
• Individuals employed in accordance with the Youth Employee Standards Act
• Independent contractors who set their own working hours and cannot be disciplined by the employer for failing to work a minimum number of hours
• Volunteers performing services for public agencies without expecting or receiving compensation
• Elected public officials, members of publicly appointed commissions and boards, and similar public office holders, unless the governing entity considers them to be employees

When can sick leave be used?

Permissible reasons for taking sick time under the Michigan paid sick leave law include:

• For the employee’s physical or mental illness, injury, diagnosis, treatment, or preventive care
• To care for a covered family member (biological or foster children, domestic partners, parents, guardians, grandparents, etc.)
• For absences related to domestic violence, sexual assault, where the employee or a family member is a victim
• For school or workplace closures due to a public health emergency
• To attend meetings at a child’s school to address issues related to the child’s health, disability, or the effects of sexual assault or domestic violence on the child

Accrual rules: how sick time builds up

Employees accrue a minimum of one hour of sick leave for every 30 hours worked, including overtime.

There is no cap on the number of hours employees can accrue annually or on a rolling basis, but the hours they are allowed to take can be limited by the employer as follows:

• Larger employers (10+ employees): up to 72 paid hours annually
• Smaller employers (<10 employees): up to 40 paid hours + 32 unpaid hours annually

Employers can provide sick leave using the accrual method or frontload the statutorily required benefits at the beginning of the year. They’re also permitted to use either method for different types of employees.

Usage limits based on employer size

The ESTA forbids employers from capping sick leave usage below the legal annual limits, which are 72 paid hours for large employers and 40 paid + 32 unpaid hours for small businesses. However, they can permit their employees to use more sick time beyond the annual usage cap.

Sick leave can generally be used in hourly or smaller increments based on the system the employer uses to account for absences or use of other time.

Employees can use their earned sick leave as soon as it is accrued, but new hires may be required to wait 120 days from their date of employment before accessing their accrued sick leave. There is no waiting period if sick time benefits are frontloaded.

Similarly, if an employee resigns or is terminated and then re-hired within two months, they’re deemed to have continuous employment, and the 120-day waiting period won’t apply. They can continue accruing and using accrued hours right away.

See also: Understanding Michigan Employment and Labor Laws

Carryover and payout policies

When using the accrual method, employers can pay out unused sick leave annually or permit employees to carry over up to 72 paid hours (large employers) and 40 paid + 32 unpaid hours (small employers) to the next year.

Employers using frontloading can enforce a “use it or lose it” policy, meaning no carryovers or payouts for earned sick time that isn’t taken.

There is no requirement to pay out unused sick leave at termination of employment, unless the employer’s contract or policy stipulates it. Where an employee leaves, either voluntarily or involuntarily, and is reinstated within two months, any previous unused sick leave must be restored.

Calculating pay for sick leave

When employees use earned sick time, employers must pay them at a rate equal to the higher of:

• The employee’s regular hourly or base wage, or
• The effective Michigan minimum wage rate

Bonuses, gratuities, commissions, tips, holiday pay, piece-rate pay, supplemental pay, overtime pay, and other special or premium pay rates need not be included when calculating an employee’s regular wage.

Once used, sick time must be paid no later than the next scheduled payday.

Recordkeeping and enforcement

Employers are required to track hours worked, earned sick time accrual, use, and balances for all employees, and these records are to be retained for at least three years.

The Michigan Department of Labor and Economic Opportunity (LEO) is responsible for overseeing the enforcement of the ESTA.

In addition to civil remedies that may be awarded to affected employees, employers who fail to meet their obligations under the law can face other penalties, including:

• An administrative fine of $1,000 and a potential civil fine up to 8 times the employee’s regular hourly wage for not providing earned sick time
• A $100 administrative fine for each separate violation for noncompliance with the posting or notice requirements

Notice and posting requirements

Employers must display the state’s official poster for sick leave rights in the workplace, in a spot where it is clearly visible. They must also give employees a written notice of their rights under the ESTA at the time of their hiring.

The notice must include specific information, such as:

• The number of earned sick hours to which they’re entitled
• Valid reasons and terms for earned sick leave usage
• The employer’s chosen 12-month period for sick leave accrual
• The employee’s right to file complaints within three years of any violation or from the date the employee learned of the violation
• Information that employees are protected from retaliation or discrimination for exercising their sick leave rights

Anti-retaliation and job protection

Sick leave is job-protected, so employees must be restored to their position upon resumption after the time off.

Employees cannot be denied their leave benefits or disciplined, discharged, threatened, demoted, suspended, or made to suffer any other adverse action for using earned sick time.

Additional notes for Michigan employers

The ESTA replaced the narrower 2019 PMLA, which means that many employers who were previously exempted from providing paid sick leave are now obligated to do so.

Certain employers, such as those working less than 25 hours per week on average, who are granted no coverage under the PMLA, are eligible for sick leave benefits under the ESTA.

Furthermore, accrual rates and limits have been raised, and employers are explicitly prohibited from retaliating against or interfering with employees requesting, exercising, or enforcing their rights.

In case of violation, employees now have more time—three years as opposed to the six months prescribed by the PMLA—to file a complaint with the Wage and Hour Division or bring civil action against the employer.

The ESTA increases the record retention period for sick leave from one to three years and mandates the reinstatement of unused paid sick leave for rehired employees, which was not a requirement under the PMLA.

Michigan’s new paid sick leave law also introduces additional reasons for taking sick leave and categories of people, beyond the usual family members, for whom employees can use their sick time.

With these changes and more in tow, employers must revisit leave-related policies, as well as their onboarding, time tracking, and payroll procedures to ensure they reflect ESTA’s broader scope.

Although ESTA is already in effect, new businesses that didn’t hire an employee on or before February 21, 2022, will have a grace period of three years from the date they employed their first employee to adhere to the act’s provisions. Existing small businesses with no more than 10 employees have until October 1, 2025, to comply.

Staying compliant with Michigan’s paid sick leave law

Taking proactive measures to prepare for or ensure compliance with ESTA will help keep your business out of legal trouble and avoid financial sanctions. This means reviewing your records to ascertain the number of employees you have and modifying your policies where necessary to meet the law’s broader requirements.

Updating your payroll and HR systems and employee handbooks to reflect appropriate sick leave accrual, carryover, usage, and notice rules is critical for mitigating non-compliance risks.

Partnering with Deel PEO helps you stay compliant by providing:

• Simplified sick leave benefits administration with automated accrual, usage, and carryover tracking, and accurate recordkeeping
• Comprehensive payroll, legal, and HR support, ensuring custom policies align with changing state, federal, and local regulations, including Michigan’s earned sick time requirements
• Expert guidance from licensed advisors, dedicated HR and payroll managers, and certified professionals who understand your business needs
• Fully localized onboarding processes for new hires with up-to-date employee handbooks and state-specific documentation

Book a demo now to discover how Deel supports effortless leave management, payroll, and HR compliance in the US and beyond.