Wage Rules

Minimum Wage and Overtime

By both State and Federal law, any employer with 2 or more employees over the age of 16, within a calendar year, is subject to minimum wage and overtime requirements (1, 2). The minimum wage in Michigan for employees 18 or older is $8.50 per hour. Employers are only required to pay overtime if they are also required to pay minimum wage. (Under Medicaid, employees must be at least 18 years of age.)

One exception to the overtime rules is for domestic employers who have an employee that lives with them. That employee is required to receive minimum wage but is not required to receive overtime (2).

Stipends:

Overnight Shifts

When an employee shift covers a normal nighttime period, they must be paid as if working a day shift, unless the shift at night is as described below.

Where an employee is scheduled to work a 24 hour shift, the employer can exclude up to 8 hours as a sleeping period. This exclusion can only be made if the employer provides adequate sleeping accommodations and the employee can enjoy uninterrupted sleep for at least 5 hours. If the employee cannot obtain 5 consecutive hours of sleep, the entire time must be treated as regular work time (2). An employee must be paid for any period of the sleeping period where they are required to provide services.

On-Call Shifts

If an employee must remain on-call while at home or somewhere other than the employer’s premises, the employee is considered to be not working and can be paid a stipend if the employer so chooses. If the employee is required to remain on the employer’s premises while on-call, then the employee is considered to be working and must be paid their regular wage (minimum wage and overtime, if applicable)(1).

 

Sources:

(1) Wage & Hour Division, Michigan Department of Labor and Economic Growth (DLEG), (2) Federal Fair Labor Standards Act (FLSA), (3) IRS Publication 926 – Household Employer’s Tax Guide, (4) IRS Publication 15 – Employer’s Tax Guide, (5) Michigan Employment Security Act (MES), (6) UIA Fact Sheet #36 – Claiming Unemployment Benefits in Michigan