Payroll Laws on an Employer Failing to Pay Employees in Michigan
The Michigan payroll laws establish payday and wage standards for employers and their employees. Employers who conduct business in the state must comply with the Michigan Department of Energy, Labor & Economic Growth's paycheck laws; employers who violate them may have to pay civil fines. Unless employers obtain consent from their employees to withhold wages, they may not deduct from their paychecks.
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Wage Deductions
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Michigan's wage deduction laws prohibit employers from deducting from an employee's paycheck without first obtaining written consent to do so. Although some states completely prohibit deductions for cash drawer shortages, equipment breakages or for paycheck advances, Michigan allows it if the employee provides advance written consent. The consent must be obtained freely by employees without fear of employment retaliation. Employers do not have any obligations under Michigan law to pay their employees for fringe benefits. They do not have to pay their employees for unused sick pay, vacation pay or holiday pay.
Compensation
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Employers in Michigan must pay their adult employees a minimum hourly wage of at $7.40, current as of April 2011. The federal minimum wage is $7.25 hourly. However, under Michigan's Minimum Wage Law of 1964, employers can pay minor employees the federal minimum wage. Furthermore, if their employees are 16 to 19 years old, employers can pay them only $4.25 per hour for a probationary period not exceeding 90 days from when they initially hired them. Tipped employees must receive at least $2.65 hourly, but if their tips do not equal or exceed the state's minimum wage, employers must pay the difference. Employers can pay their employees "compensatory pay" in lieu of overtime for hours exceeding 40 hours weekly. After an employee accrues over 240 hours of overtime at time and one-half, her employer must pay her monetary wages.
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Employment Hours and Pay
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Michigan law allows employees to work mandatory overtime if required by their employers. They may also reduce an employee's wages after providing notice and only for hours not yet worked. Additionally, under the Public Act 390 of 1978, the Payment of Wages and Fringe Benefits Act, an employer who voluntarily provides paid vacation can require its employees to use accrued vacation during a plant shutdown or furlough. Employees have a one-year statute of limitations period from the date the violation occurred to file wage and payroll complaints with the Michigan Department of Energy, Labor & Economic Growth.
Paychecks
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Employers cannot impose docking of wages or time as a disciplinary measure or as a penalty against its employees. According to Michigan law, employers can be forced to pay back wages and penalties if they illegally withhold an employee's wages. They may not withhold pay, deduct pay or pay comp time unless they obtain consent to do so. Michigan law requires employers to provide last paychecks on the payday immediately following termination. However, for employees who work in agriculture or crop harvesting, employers must pay them within one day after termination.
Considerations
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Since state laws can frequently change, do not use this information as a substitute for legal advice. Seek advice through an attorney licensed to practice law in your state.
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