The headline numbers
Wage phase-in disrupted by 2024 Mothering Justice ruling reinstating Improved Workforce Opportunity Wage Act. Subsequent 2025 House Bill 4002 set current rates: $12.48 starting February 2025; $13.73 in February 2026.
Michigan currently allows a tip credit, but it's being phased out. Direct wage today is $4.74/hour, with tips required to bring total earnings to at least the full minimum of $12.48. The phase-out schedule moves toward eliminating the tip credit entirely. Tipped wage was scheduled to phase out by 2030 per the original Mothering Justice ruling, but House Bill 4002 (2025) restored a tip credit structure with annual wage increases.
Tip pool rules
Tipped wage was scheduled to phase out by 2030 per the original Mothering Justice ruling, but House Bill 4002 (2025) restored a tip credit structure with annual wage increases.
Universal rules that apply in every state regardless of tip credit status:
- Managers and supervisors cannot keep any portion of tips, even in a valid tip pool. This is a federal rule under FLSA Section 203(m)(2)(B) and applies in Michigan.
- Workers must keep all tips minus valid tip pool / tip-out contributions.
- If the employer uses a tip credit, only customarily tipped employees can be in the tip pool. To include BOH (cooks, dishwashers), the employer must pay full minimum wage to all participants.
Sidework and the 80/20 rule in Michigan
No active state rule.
The federal 80/20 rule was struck down by the 5th Circuit in Restaurant Law Center v. DOL (2024) and is no longer enforceable as a federal regulation. Whether sidework time over 20% triggers full-minimum-wage protection in Michigan depends entirely on state-level enforcement. If your state doesn't have its own active rule, all sidework hours within the tipped occupation may be paid at the tipped wage.
Local minimums that may apply
Several cities and counties in the U.S. set higher minimum wages than their state. Local minimums always supersede state minimums where applicable. Check whether your city has its own ordinance:
- No major city-level minimum wage ordinances in Michigan currently — the state minimum applies statewide for tipped workers.
Notable state-specific items
- Tip credit was nearly eliminated in 2024 ruling, then restored with modifications by 2025 legislation
- Detroit and other cities have local income taxes
How to verify the current numbers
Wages, indexed minimums, and tip credit rules change. Always cross-check before relying on specifics:
- State labor agency: https://www.michigan.gov/leo/
- State revenue agency (for tax info): https://www.michigan.gov/taxes/
- Federal DOL Wage and Hour Division: dol.gov/agencies/whd