Minimum Wage Proposal in Michigan Dismissed by Supreme Court
The Michigan Supreme Court recently dismissed a petition that sought to put up a ballot question for the November elections on raising the hourly state minimum wage to $15. The effort was led by activist group Raise the Wage MI, who had earlier received approval from the Michigan Board of State Canvassers for a petition that aimed to increase the minimum wage to $12 per hour in 2024, rising to $15 per hour in 2027.
However, the board refused to approve the revised petition, claiming that the proposal’s wording had changed from the initial approval. The group then approached the court to intervene in the matter. Raise the Wage MI argued that their efforts to increase minimum wages would benefit one million workers in Michigan, particularly women, immigrants, and people of color who are subject to harassment and discrimination due to the reliance on tips.
In its order, the Michigan Supreme Court denied Raise the Wage MI’s request, stating that the initial petition must be a “true and impartial statement” of the questions that appeared in the final petition. The court observed that the final petition would have actually eliminated minimum wage rights for thousands of employees instead of raising it.
The court also noted that the initial petition would have eliminated any recognized difference between tipped and non-tipped labor, potentially affecting workers who rely on tips as their primary source of income. The court cited a survey conducted by the Michigan Restaurant & Lodging Association (MRLA), which found that 91 percent of restaurants would offset higher minimum wages by raising menu prices and room rates. Additionally, 58 percent said they would lay off employees and 39 percent stated they may look to sell their business.
The MRLA, which had intervened in the case, welcomed the court’s decision. MRLA CEO Justin Winslow expressed relief and stated that the ruling would allow industry employees and operators to focus on providing hospitality to Michiganders.
The issue of minimum wage is a contentious one, with advocates arguing for higher wages to alleviate poverty and stimulate the economy. Holly Sklar, CEO of Business for a Fair Minimum Wage, claimed that raising minimum wages would strengthen businesses by boosting consumer spending and helping with employee retention.
However, studies have warned about the potential negative impacts of minimum wage increases. A study conducted in June 2023 found that a $2.50 per hour increase in minimum wages resulted in a 14 percent increase in homelessness. The Congressional Budget Office also cautioned in 2019 that raising the federal minimum wage to $15 by 2025 could lead to 1.3 million Americans losing their jobs.
While the court did not take a position on the merits of the minimum wage proposal, it emphasized that policy decisions should be left to the legislature and democratic processes.
The dismissal of the petition in Michigan highlights the ongoing debate surrounding minimum wage laws and their potential impact on workers and businesses. As states continue to grapple with this issue, it is crucial to consider both the benefits and potential consequences of raising the minimum wage. Ultimately, finding a balance that supports workers while also considering the concerns of businesses is essential for creating sustainable and equitable economic growth.
