Michigan minimum wage was last updated via the Public Act 337 of 2018, Improved Workforce Opportunity Wage Act (IWOWA), which included updates for both 2026 and 2027. The law applies to all employers with at least 2 employees 16 years of age and older.
Here is everything you need to know:
The standard minimum wage in Michigan for 2026 is $13.73 per hour, which went into effect on January 1st, 2026. The law applies to all employers with at least 2 employees who are 16 years of age or older. It's important to note that the standard minimum wage rate will increase again on January 1st, 2027, to $15.00 per hour.
Michigan Minimum Wage Law also includes specific rates for tipped employees, minors, and employees in training. Lastly, the law includes additional provisions around overtime and equal pay.
Employees who regularly recieve and report tips may be compensated at a lower minimum wage rate. For 2026, the tipped minimum wage in Michigan is $5.49 per hour (40% of the standard minimum wage rate).
In order to be compensated at the tipped minimum wage rate, employees must receive and report an average of at least $8.24 per hour in tips for 2026. In other words, the combined amount of wages and tips must at least equal the standard minimum wage rate for the given year. If an employee does not receive enough tips in a given pay period to satisfy the standard minimum wage rate requirement, the employer must make up the difference.
Michigan tipped minimum wage increases each year, and is always a percentage of the standard minimum wage rate. For 2027, the tipped minimum wage rate will increase to $6.30 per hour (42% of the 2027 standard minimum wage rate). The percentage will continue to increase each year until it reaches 50% in 2031.
Employers working in the hospitality industry may want to consider these best practices on navigating minimum wage and tip compliance in restaurants.
Michigan also allows employers to compensate minors under the age of 18 at 85% of the standard minimum wage rate. The minimum wage in Michigan for minors in 2026 is $11.67.
This rate will change each time the standard minimum wage rate changes. For 2027, the rate for minors will increase to $12.75.
The law also includes a training wage rate, which may be used for employees under 20 years of age for the first 90 calendar days of employment. The Michigan training wage is $4.25 per hour and has remained unchanged since the original implementation of the IWOWA.
The following table breaks down all Michigan minimum wage rates from 2025 through 2027:
| Effective Date | Standard Minimum Wage Rate | Tipped Minimum Wage Rate | Required Reported Average Hourly Tips | Minimum Wage Rate for Minors | Training Minimum Wage Rate |
| February 21, 2025 | $12.48 | $4.74 | $7.74 | $10.61 | $4.25 |
| January 1st, 2026 | $13.73 | $5.49 | $8.24 | $11.67 | $4.25 |
| January 1st, 2027 | $15.00 | $6.30 | $8.70 | $12.75 | $4.25 |
There are three additional key areas regarding Michigan Minimum Wage Law, including:
Employees covered by the IWOWA are entitled to 1 and a half times their normal pay rate for hours worked over 40 in a workweek, with some exemptions. Employees not covered by the IWOWA are subject to Fair Labor Standards Act (FLSA) overtime rules.
Exemptions include:
Under Michigan Minimum Wage Law, it is illegal for employers to discriminate against employees on the basis of sex when it comes to compensation. In other words, by paying employees a rate which is less than the rate paid to employees
of the opposite sex for equal work on jobs (requiring equal skill, effort, and responsibility performed under similar working conditions).
If there is a disparity in compensation between two employees of a different sex, the employer must demonstrate that the difference in payment is pursuant to a seniority system, merit system, another system measuring earnings on the basis of quantity or quality of production, or any other differential other than sex.
Employers are required to display the Michigan Improved Workforce Opportunity Wage Act (IWOWA) PA 337 of 2018 poster, so long as they are not covered by FLSA requirements, or if federal minimum wage is less than what is mandated under Michigan Law (which are most employers in the state.
If an employee believes their employer has violated the provisions under the IWOWA, they may either file civil action for recovery of unpaid minimum wages or overtime, or they may file a complaint with the Department of Labor and Economic Opportunity.
All complaints shall be investigated, and civil action will be filed by the department to collect unpaid wages or overtime due the employee and all employees of an establishment. Employees may also be entitled to additional compensation as liquidated damages, costs, and reasonable attorney fees.
Employers may also incur a civil fine of $1,000 to $2,500 depending on the nature of the violation.
Here are some common questions regarding Michigan Minimum Wage Law:
The 2026 Michigan minimum wage is $13.73 per hour.
Michigan’s standard minimum wage rate will increase again on January 1st, 2027. This will impact the standard, tipped, and minor minimum wage rates for the state.
Employees who work in Michigan for employers that have 2 or more employees, 16 years of age and older are covered. Employers subject to both the state and federal minimum hourly wage rate should follow the standard that with greater rights and protections for employees.
Yes. Workers under the age of 18 may be paid 85% of the standard minimum hourly wage rate.
Newly hired employees under 20 years old may be paid $4.25 per hour for the first 90 calendar days of employment.
Yes. Tipped employees may be compensated at the current applicable tipped minimum wage rate, so long as wages and tips combined are equal to or are greater then the standard Michigan minimum wage rate.
Employers who violate the law may be subject to payment of unpaid minimum wages or overtime, additional damages paid to the employee, and fines up to $2,500.
If you are struggling to maintain compliance with Michigan minimum wage requirements, having trouble managing multiple wage rates, or are experiencing other payroll-related challenges in Michigan, it may be time to reach out to a local Michigan payroll company with expertise in your area.
Contact us today to learn more. Or, if you are looking for additional Michigan State Resources, check out this page.