SENATE BILL No. 934

 

 

May 8, 2014, Introduced by Senator RICHARDVILLE and referred to the Committee on Committee of the Whole.

 

 

 

     A bill to fix minimum wages for employees within this state;

 

to prohibit wage discrimination; to provide for a wage deviation

 

board; to provide for the administration and enforcement of this

 

act; to prescribe penalties for the violation of this act; and to

 

repeal acts and parts of acts.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 1. This act shall be known and may be cited as the

 

"workforce opportunity wage act".

 

     Sec. 2. As used in this act:

 

     (a) "Commissioner" means the director of the department of

 

licensing and regulatory affairs.

 

     (b) "Employ" means to engage, suffer, or permit to work.

 

     (c) "Employee" means an individual not less than 16 years of

 


age employed by an employer on the premises of the employer or at a

 

fixed site designated by the employer, and includes a minor

 

employed subject to section 15(1) of the youth employment standards

 

act, 1978 PA 90, MCL 409.115.

 

     (d) "Employer" means a person, firm, or corporation, including

 

the state and its political subdivisions, agencies, and

 

instrumentalities, and a person acting in the interest of the

 

employer, who employs 2 or more employees at any 1 time within a

 

calendar year. An employer is subject to this act during the

 

remainder of that calendar year.

 

     Sec. 3. An employer shall not pay any employee at a rate that

 

is less than prescribed in this act.

 

     Sec. 4. Subject to the exceptions specified in this act, the

 

minimum hourly wage rate is:

 

     (a) Before September 1, 2014, $7.40.

 

     (b) Beginning September 1, 2014, $8.15.

 

     Sec. 4a. (1) Except as otherwise provided in this act, an

 

employee shall receive compensation at not less than 1-1/2 times

 

the regular rate at which the employee is employed for employment

 

in a workweek in excess of 40 hours.

 

     (2) This state or a political subdivision, agency, or

 

instrumentality of this state does not violate subsection (1) with

 

respect to the employment of an employee in fire protection

 

activities or an employee in law enforcement activities, including

 

security personnel in correctional institutions, if any of the

 

following apply:

 

     (a) In a work period of 28 consecutive days, the employee

 


receives for tours of duty, which in the aggregate exceed 216

 

hours, compensation for those hours in excess of 216 at a rate not

 

less than 1-1/2 times the regular rate at which the employee is

 

employed. The employee's regular rate shall be not less than the

 

statutory minimum hourly rate.

 

     (b) For an employee to whom a work period of at least 7 but

 

less than 28 days applies, in the employee's work period the

 

employee receives for tours of duty, which in the aggregate exceed

 

a number of hours which bears the same ratio to the number of

 

consecutive days in the employee's work period as 216 bears to 28

 

days, compensation for those excess hours at a rate not less than

 

1-1/2 times the regular rate at which the employee is employed. The

 

employee's regular rate shall be not less than the statutory

 

minimum hourly rate.

 

     (c) If an employee engaged in fire protection activities would

 

receive overtime payments under this act solely as a result of that

 

employee's trading of time with another employee pursuant to a

 

voluntary trading time arrangement, overtime, if any, shall be paid

 

to employees who participate in the trading of time as if the time

 

trade had not occurred. As used in this subdivision, "trading time

 

arrangement" means a practice under which employees of a fire

 

department voluntarily substitute for one another to allow an

 

employee to attend to personal matters, if the practice is neither

 

for the convenience of the employer nor because of the employer's

 

operations.

 

     (3) This state or a political subdivision, agency, or

 

instrumentality of this state engaged in the operation of a

 


hospital or an establishment that is an institution primarily

 

engaged in the care of the sick, the aged, or the mentally ill or

 

developmentally disabled who reside on the premises does not

 

violate subsection (1) if both of the following conditions are met:

 

     (a) Pursuant to a written agreement or written employment

 

policy arrived at between the employer and the employee before

 

performance of the work, a work period of 14 consecutive days is

 

accepted instead of the workweek of 7 consecutive days for purposes

 

of overtime computation.

 

     (b) For the employee's employment in excess of 8 hours in a

 

workday and in excess of 80 hours in the 14-day period, the

 

employee receives compensation at a rate of 1-1/2 times the regular

 

rate, which shall be not less than the statutory minimum hourly

 

rate at which the employee is employed.

 

     (4) Subsections (1), (2), and (3) do not apply to any of the

 

following:

 

     (a) An employee employed in a bona fide executive,

 

administrative, or professional capacity, including an employee

 

employed in the capacity of academic administrative personnel or

 

teacher in an elementary or secondary school. However, an employee

 

of a retail or service establishment is not excluded from the

 

definition of employee employed in a bona fide executive or

 

administrative capacity because of the number of hours in the

 

employee's workweek that the employee devotes to activities not

 

directly or closely related to the performance of executive or

 

administrative activities, if less than 40% of the employee's hours

 

in the workweek are devoted to those activities.

 


     (b) An individual who holds a public elective office.

 

     (c) A political appointee of a person holding public elective

 

office or a political appointee of a public body, if the political

 

appointee described in this subdivision is not covered by a civil

 

service system.

 

     (d) An employee employed by an establishment that is an

 

amusement or recreational establishment, if the establishment does

 

not operate for more than 7 months in a calendar year.

 

     (e) An employee employed in agriculture, including farming in

 

all its branches, which among other things includes: cultivating

 

and tilling soil; dairying; producing, cultivating, growing, and

 

harvesting agricultural or horticultural commodities; raising

 

livestock, bees, fur-bearing animals, or poultry; and a practice,

 

including forestry or lumbering operations, performed by a farmer

 

or on a farm as an incident to or in conjunction with farming

 

operations, including preparation for market, delivery to storage,

 

or delivery to market or to a carrier for transportation to market

 

or processing or preserving perishable farm products.

 

     (f) An employee who is not subject to the minimum hourly wage

 

provisions of this act.

 

     (5) The director of the department of licensing and regulatory

 

affairs shall promulgate rules under the administrative procedures

 

act of 1969, 1969 PA 306, MCL 24.201 to 24.328, to define the terms

 

used in subsection (4).

 

     (6) For purposes of administration and enforcement, an amount

 

owing to an employee that is withheld in violation of this section

 

is unpaid minimum wages under this act.

 


     (7) The legislature shall annually appropriate from the

 

general fund to each political subdivision affected by subsection

 

(2) an amount equal to the difference in direct labor costs before

 

and after January 4, 1979 arising from any change in existing law

 

that results from the enactment of subsection (2) and incurred by

 

the political subdivision.

 

     (8) In lieu of monetary overtime compensation, an employee

 

subject to this act may receive compensatory time off at a rate

 

that is not less than 1-1/2 hours for each hour of employment for

 

which overtime compensation is required under this act, subject to

 

all of the following:

 

     (a) The employer must allow employees a total of at least 10

 

days of leave per year without loss of pay and must provide the

 

compensatory time to the employee under either of the following:

 

     (i) Applicable provisions of a collective bargaining agreement,

 

memorandum of understanding, or any other written agreement between

 

the employer and representative of the employee.

 

     (ii) If employees are not represented by a collective

 

bargaining agent or other representative designated by the

 

employee, a plan adopted by the employer and provided in writing to

 

its employees that provides employees with a voluntary option to

 

receive compensatory time off for overtime work when there is an

 

express, voluntary written request to the employer by an individual

 

employee for compensatory time off in lieu of overtime pay before

 

the performance of any overtime assignment.

 

     (b) The employee has not earned compensatory time in excess of

 

the applicable limit prescribed by subdivision (d).

 


     (c) The employee is not required as a condition of employment

 

to accept or request compensatory time. An employer shall not

 

directly or indirectly intimidate, threaten, or coerce or attempt

 

to intimidate, threaten, or coerce an employee for the purpose of

 

interfering with the employee's rights under this section to

 

request or not request compensatory time off in lieu of payment of

 

overtime compensation for overtime hours, or requiring an employee

 

to use compensatory time. In assigning overtime hours, an employer

 

shall not discriminate among employees based upon an employee's

 

choice to request or not request compensatory time off in lieu of

 

overtime compensation. An employer who violates this subsection is

 

subject to a civil fine of not more than $1,000.00.

 

     (d) An employee may not accrue more than a total of 240 hours

 

of compensatory time. An employer shall do both of the following:

 

     (i) Maintain in an employee's pay record a statement of

 

compensatory time earned by that employee in the pay period that

 

the pay record identifies.

 

     (ii) Provide an employee with a record of compensatory time

 

earned by or paid to the employee in a statement of earnings for

 

the period in which the compensatory time is earned or paid.

 

     (e) Upon the request of an employee who has earned

 

compensatory time, the employer shall, within 30 days following the

 

request, provide monetary compensation for that compensatory time

 

at a rate not less than the regular rate earned by the employee at

 

the time the employee performed the overtime work.

 

     (f) An employee who has earned compensatory time authorized

 

under this subsection shall, upon the voluntary or involuntary

 


termination of employment or upon expiration of this subsection, be

 

paid unused compensatory time at a rate of compensation not less

 

than the regular rate earned by the employee at the time the

 

employee performed the overtime work. A terminated employee's

 

receipt of or eligibility to receive monetary compensation for

 

earned compensatory time shall not be used by either of the

 

following:

 

     (i) The employer to oppose an employee's application for

 

unemployment compensation under the Michigan employment security

 

act, 1936 (Ex Sess) PA 1, MCL 421.1 to 421.75.

 

     (ii) The state to deny unemployment compensation or diminish an

 

employee's entitlement to unemployment compensation benefits under

 

the Michigan employment security act, 1936 (Ex Sess) PA 1, MCL

 

421.1 to 421.75.

 

     (g) An employee shall be permitted to use any compensatory

 

time accrued under this subsection for any reason unless use of the

 

compensatory time for the period requested will unduly disrupt the

 

operations of the employer.

 

     (h) Unless prohibited by a collective bargaining agreement, an

 

employer may terminate a compensatory time plan upon not less than

 

60 days' notice to employees.

 

     (i) As used in this subsection:

 

     (i) "Compensatory time" and "compensatory time off" mean hours

 

during which an employee is not working and for which the employee

 

is compensated in accordance with this subsection in lieu of

 

monetary overtime compensation.

 

     (ii) "Overtime assignment" means an assignment of hours for

 


which overtime compensation is required under this act.

 

     (iii) "Overtime compensation" means the compensation required

 

under this section.

 

     Sec. 4b. (1) An employer may pay a new employee who is less

 

than 20 years of age a training hourly wage of $4.25 for the first

 

90 days of that employee's employment. The hourly wage authorized

 

under this subsection is in lieu of the minimum hourly wage

 

otherwise prescribed by this act.

 

     (2) Except as provided in subsection (1), the minimum hourly

 

wage for an employee who is less than 18 years of age is 85% of the

 

general minimum hourly wage established in section 4.

 

     (3) An employer shall not displace an employee to hire an

 

individual at the hourly wage authorized under this section. As

 

used in this subsection, "displace" includes termination of

 

employment or any reduction of hours, wages, or employment

 

benefits.

 

     (4) A person who violates subsection (3) is subject to a civil

 

fine of not more than $1,000.00.

 

     Sec. 4c. On petition of a party in interest or on his or her

 

own initiative, the commissioner shall establish a suitable scale

 

of rates for apprentices, learners, and persons with physical or

 

mental disabilities who are clearly unable to meet normal

 

production standards. The rates established under this section may

 

be less than the regular minimum wage rate for workers who are

 

experienced and who are not disabled.

 

     Sec. 4d. (1) Before September 1, 2014, the minimum hourly wage

 

rate of an employee shall be $2.65 per hour, and beginning

 


September 1, 2014, the minimum hourly wage rate of an employee

 

shall be $2.93, if all of the following occur:

 

     (a) The employee receives gratuities in the course of his or

 

her employment.

 

     (b) If the gratuities described in subdivision (a) plus the

 

minimum hourly wage rate under this subsection do not equal or

 

exceed the minimum hourly wage otherwise established under section

 

4, the employer pays any shortfall to the employee.

 

     (c) The gratuities are proven gratuities as indicated by the

 

employee's declaration for federal insurance contribution act

 

purposes.

 

     (d) The employee was informed by the employer of the

 

provisions of this section.

 

     (2) As used in this section, "gratuities" means tips or

 

voluntary monetary contributions received by an employee from a

 

guest, patron, or customer for services rendered to that guest,

 

patron, or customer and that the employee reports to the employer

 

for purposes of the federal insurance contributions act, 26 USC

 

3101 to 3128.

 

     Sec. 5. (1) The governor shall appoint, with the advice and

 

consent of the senate, a wage deviation board composed of 3

 

representatives of the employers, 3 representatives of the

 

employees, and 3 persons representing the public. One of the 3

 

persons representing the public shall be designated as chairperson.

 

Members shall serve for terms of 3 years, except that of the

 

members first appointed, 1 from each group shall be appointed for 1

 

year, 1 for 2 years, and 1 for 3 years. The commissioner shall be

 


secretary of the wage deviation board.

 

     (2) A majority of the members of the board constitute a

 

quorum, and the recommendation or report of the board requires a

 

vote of not less than a majority of its members. The business which

 

the wage deviation board may perform shall be conducted at a public

 

meeting of the board held in compliance with the open meetings act,

 

1976 PA 267, MCL 15.261 to 15.275. Public notice of the time, date,

 

and place of the meeting shall be given in the manner required by

 

that act.

 

     (3) A writing prepared, owned, used, in the possession of, or

 

retained by the wage deviation board in the performance of an

 

official function shall be made available to the public in

 

compliance with the freedom of information act, 1976 PA 442, MCL

 

15.231 to 15.246.

 

     (4) The per diem compensation of the board and the schedule

 

for reimbursement of expenses shall be established annually by the

 

legislature.

 

     (5) The wage deviation board may request data of any employer,

 

subject to the provisions of this act, as to the wages paid and

 

hours worked by the employer's employees and may hold hearings as

 

necessary in the process of obtaining this information.

 

     (6) The wage deviation board shall submit its report to the

 

commissioner, who shall file it in his or her office as a public

 

record together with the regulations established by the board.

 

     (7) At any time after a deviated wage rate has been in effect

 

for 6 months or more, the wage deviation board may reconsider the

 

rate.

 


     Sec. 6. The commissioner may promulgate rules necessary for

 

administration of this act under the administrative procedures act

 

of 1969, 1969 PA 306, MCL 24.201 to 24.328.

 

     Sec. 7. An employer who is subject to this act or any

 

regulation or order issued under this act shall furnish each

 

employee with a statement of the hours worked by the employee and

 

of the wages paid to the employee, listing deductions made each pay

 

period. The employer shall furnish the commissioner, upon demand, a

 

sworn statement of the wage information. These records shall be

 

open to inspection by the commissioner, his or her deputy, or any

 

authorized agent of the department at any reasonable time. An

 

employer subject to this act or any regulation or order issued

 

under this act shall keep a copy of this act and regulations and

 

orders promulgated under this act posted in a conspicuous place in

 

the workplace that is accessible to employees. The commissioner

 

shall furnish copies of this act and the regulations and orders to

 

employers without charge.

 

     Sec. 8. The commissioner shall administer and enforce this act

 

and, at the request of the wage deviation board, may investigate

 

and ascertain the wages of employees of an employer subject to this

 

act. The commissioner and the commissioner's employees shall not

 

reveal facts or information obtained in the course of official

 

duties, except as when required by law, to report upon or take

 

official action or testify in proceedings regarding the affairs of

 

an employer subject to this act.

 

     Sec. 9. (1) If an employer violates this act, the employee

 

affected by the violation, at any time within 3 years, may do any

 


of the following:

 

     (a) Bring a civil action for the recovery of the difference

 

between the amount paid and the amount that, but for the violation,

 

would have been paid the employee under this act and an equal

 

additional amount as liquidated damages together with costs and

 

reasonable attorney fees as are allowed by the court.

 

     (b) File a claim with the commissioner who shall investigate

 

the claim.

 

     (2) If the commissioner determines there is reasonable cause

 

to believe that the employer has violated this act and the

 

commissioner is subsequently unable to obtain voluntary compliance

 

by the employer within a reasonable period of time, the

 

commissioner shall bring a civil action under subsection (1)(a).

 

The commissioner may investigate and file a civil action under

 

subsection (1)(a) on behalf of all employees of that employer who

 

are similarly situated at the same work site and who have not

 

brought a civil action under subsection (1)(a). A contract or

 

agreement between the employer and the employee or any acceptance

 

of a lesser wage by the employee is not a bar to the action.

 

     (3) In addition to bearing liability for civil remedies

 

described in this section, an employer who fails to pay the minimum

 

hourly wage in violation of this act, or who violates a provision

 

of section 4a governing an employee's compensatory time, is subject

 

to a civil fine of not more than $1,000.00.

 

     Sec. 10. (1) This act does not apply to an employer that is

 

subject to the minimum wage provisions of the fair labor standards

 

act of 1938, 29 USC 201 to 219, unless those federal minimum wage

 


provisions would result in a lower minimum hourly wage than

 

provided in this act. Each of the following exceptions applies to

 

an employer who is subject to this act only by application of this

 

subsection:

 

     (a) Section 4a does not apply.

 

     (b) This act does not apply to an employee who is exempt from

 

the minimum wage requirements of the fair labor standards act of

 

1938, 29 USC 201 to 219.

 

     (2) Notwithstanding subsection (1), an employee shall be paid

 

in accordance with the minimum wage and overtime compensation

 

requirements of sections 4 and 4a if the employee meets either of

 

the following conditions:

 

     (a) He or she is employed in domestic service employment to

 

provide companionship services as defined in 29 CFR 552.6 for

 

individuals who, because of age or infirmity, are unable to care

 

for themselves and is not a live-in domestic service employee as

 

described in 29 CFR 552.102.

 

     (b) He or she is employed to provide child care, but is not a

 

live-in domestic service employee as described in 29 CFR 552.102.

 

However, the requirements of sections 4 and 4a do not apply if the

 

employee meets all of the following conditions:

 

     (i) He or she is under the age of 18.

 

     (ii) He or she provides services on a casual basis as defined

 

in 29 CFR 552.5.

 

     (iii) He or she provides services that do not regularly exceed

 

20 hours per week, in the aggregate.

 

     (3) This act does not apply to persons employed in summer

 


camps for not more than 4 months or to employees who are covered

 

under section 14 of the fair labor standards act of 1938, 29 USC

 

214.

 

     (4) This act does not apply to agricultural fruit growers,

 

pickle growers and tomato growers, or other agricultural employers

 

who traditionally contract for harvesting on a piecework basis, as

 

to those employees used for harvesting, until the board has

 

acquired sufficient data to determine an adequate basis to

 

establish a scale of piecework and determines a scale equivalent to

 

the prevailing minimum wage for that employment. The piece rate

 

scale shall be equivalent to the minimum hourly wage in that, if

 

the payment by unit of production is applied to a worker of average

 

ability and diligence in harvesting a particular commodity, he or

 

she receives an amount not less than the hourly minimum wage.

 

     (5) Notwithstanding any other provision of this act,

 

subsection (1)(a) and (b) and subsection (2) do not deprive an

 

employee or any class of employees of any right that existed on

 

September 30, 2006 to receive overtime compensation or to be paid

 

the minimum wage.

 

     Sec. 11. An employer that discharges or in any other manner

 

discriminates against an employee because the employee has served

 

or is about to serve on the wage deviation board or has testified

 

or is about to testify before the board, or because the employer

 

believes that the employee may serve on the board or may testify

 

before the board or in any investigation under this act, and any

 

person who violates any provision of this act or of any regulation

 

or order issued under this act, is guilty of a misdemeanor.

 


     Sec. 12. Any employer that consistently discharges employees

 

within 10 weeks of their employment and replaces the discharged

 

employees without work stoppage is presumed to have discharged them

 

to evade payment of the wage rates established in this act and is

 

guilty of a misdemeanor.

 

     Sec. 13. (1) An employer having employees subject to this act

 

shall not discriminate between employees within an establishment on

 

the basis of sex by paying wages to employees in the establishment

 

at a rate less than the rate at which the employer pays wages to

 

employees of the opposite sex for equal work on jobs, the

 

performance of which requires equal skill, effort, and

 

responsibility and that is performed under similar working

 

conditions, except if the payment is made under 1 or more of the

 

following:

 

     (a) A seniority system.

 

     (b) A merit system.

 

     (c) A system that measures earnings by quantity or quality of

 

production.

 

     (d) A differential based on a factor other than sex.

 

     (2) An employer that is paying a wage differential in

 

violation of this section shall not reduce the wage rate of an

 

employee to comply with this section.

 

     (3) For purposes of administration and enforcement, any amount

 

owing to an employee that has been withheld in violation of this

 

section is considered unpaid minimum wages under this act.

 

     Sec. 14. An employer operating a massage establishment as

 

defined in section 2 of former 1974 PA 251 that violates this act

 


is guilty of a misdemeanor punishable by imprisonment for not more

 

than 1 year or a fine of not more than $1,000.00, or both.

 

     Enacting section 1. The minimum wage law of 1964, 1964 PA 154,

 

MCL 408.381 to 408.398, is repealed.