Salaried employees are individuals who receive a predetermined fixed amount of compensation at regular intervals, such as weekly or less frequently.
This article aims to provide an overview of the applicable laws and regulations governing the rights and obligations of both salaried employees and their employers in Michigan.
It will cover various topics, including payment, break and leave entitlements, as well as the distinction between exempt and non-exempt employees.
This article covers:
- Payment of Wages for Salaried Employees in Michigan
- Salaried Employees Eligibility for Overtime in Michigan
- Pay for Working Overtime for Michigan Salaried Employees
- Exceptions to Overtime Exemptions for Michigan Salaried Employees
- Violation of Salaried Employees Wages Payment in Michigan
- Male and Female Salaried Employees in Michigan
- Leave Entitlements for Salaried Employees in Michigan
- Break Entitlements for Salaried Employees in Michigan
- Deductions from Exempt Employees’ Salary in Michigan
- Termination of Employment for Salaried Employees in Michigan
In Michigan, employers have specific regulations governing the frequency of employee payments. For those following a regular weekly or bi-weekly schedule, they must pay their employees for work performed during the first 15 days of the previous month by the first day of the current calendar month.
Likewise, payment for work done from the 16th to the last day of the previous month must be made by the 15th day of the current month.
Employers with a monthly payment schedule are required to compensate their employees for all work conducted in the previous month within 15 days of the end of the monthly pay period.
Monitoring payroll cycles and approvals as well as ensuring overtime hours compliance (when applicable based on company policies) can be meaningful. While it’s not mandatory, these records provide valuable information for salaried employees regarding time off and compensation.
Under the Fair Labor Standards Act (FLSA), non-exempt employees are entitled to receive overtime pay at a rate of 1.5 times their regular hourly pay for any hours worked over 40 in a week. This applies when employees work more than eight hours a day or more than five days a week.
Even if employees are paid a salary, they are still eligible for overtime pay if they are non-exempt and work more than 40 hours in a week.
To calculate overtime wages in Michigan, the weekly salary is divided by 40 (or bi-monthly salary by 80) to determine the regular hourly rate, which is then multiplied by 1.5 to obtain the overtime rate.
Michigan has specific exemptions for certain professions from the obligation to receive overtime pay.
Notably, retail and service employees can be categorized as administrative, executive, or professional if over 40% of their workweek activities fall into these roles.
The exempted professions include individuals not covered by minimum wage requirements, agricultural workers, employees of seasonal amusement establishments, public office holders, and administrative, professional, or executive employees like teachers or school administrators.
Learn more in detail about Michigan Overtime Laws.
Overtime pay that remains unpaid can be collected within specific timeframes. The main distinction between Michigan law and Federal Law lies in the statute of limitations. In Michigan, individuals can still collect unpaid overtime up to three years from the date the pay was earned. Conversely, under Federal Overtime law, the time limit is two years, extending to three years only in cases where the employer consciously and intentionally violated the overtime law. Keeping timesheets and records of employee hours can be helpful in such cases.
Furthermore, both Federal and Michigan overtime laws allow for additional compensation, known as liquidated damages, if the employer’s failure to pay overtime was intentional. This additional amount serves as a punishment for the employer, aligning the intent of both laws.
Laws such as the Workforce Opportunity Wage Act (M.C.L.A. § 408.423), the Elliott-Larsen Civil Rights Act (M.C.L.A. § 37.2202), and M.C.L.A. § 750.556 from the Penal Code, address discrimination between sexes in payment of wages.
As per law, any employer in this state, hiring both male and female workers, found engaging in any form of wage discrimination between genders for similar job positions, shall be charged with a misdemeanor.
In Michigan, salaried employees have access to various types of leave. The Paid Medical Leave Act allows employees in larger organizations to receive paid sick leave, earned at a rate of 1 hour per 35 hours worked. Family Medical Leave permits up to 12 weeks of unpaid leave for specific life events, but eligibility requires 12 months of employment and 1,250 hours worked. The Paid Medical Leave Act also provides leave for victims of domestic violence and sexual assault, allowing employees to use medical leave for related purposes.
Employees have the right to serve on a jury without retaliation, and certain state employees may receive unpaid or paid Emergency Response Leave for disaster relief. Military Leave is available for uniformed services members, granting full seniority credit under specific conditions.
In Michigan, neither federal regulations nor state laws require employers to provide meal breaks or rest periods to their employees while they are working. However, if an employer decides to implement a policy offering unpaid breaks, employees must be allowed to completely stop all work-related duties during those designated time periods.
Regarding exceptions to the break law in Michigan, employers must provide breaks to employees who are minors. According to the Michigan Youth Employment Standards Act, minors working for five or more consecutive hours must be given a minimum of 30 minutes for rest or a meal.
To guarantee that employees fully enjoy their entitled leave benefits, especially those dependent on the number of hours worked, tracking work hours might be essential, or the use of automated time-off tracking could simplify the process.
In general, exempt employees must be paid their full salary if they perform any work during the workweek. Deductions are permitted for legally required withholdings and benefit elections. While salaried employees typically do not need to monitor their attendance, there are situations where time and attendance tracking can prove to be beneficial.
However, there are specific situations where deductions from an exempt employee’s salary are allowed under federal law:
- If the employee performs no work during a workweek.
- In the initial or final week of employment based on the actual number of hours worked.
- For absences of one or more full days due to personal reasons (other than sickness or disability).
- For absences of one or more full days due to sickness or disability, if made in accordance with a bona fide paid sick leave plan.
- To offset amounts received from jury or witness fees or military pay.
- For penalties imposed in good faith for significant safety rule infractions as per established workplace policy.
- For unpaid disciplinary suspensions of one or more full days imposed in good faith for workplace conduct rule violations.
- For leave taken under the Family and Medical Leave Act.
If none of these situations apply, an exempt employee must be paid their full salary for any week in which they perform any work, regardless of the number of days or hours worked. It is essential to note that some states may not allow all of these deductions.
Michigan follows the “employment-at-will” principle, allowing employers or employees to end the employment relationship without providing a reason. Private employees are subject to this policy unless their contract specifies otherwise.
Upon termination, the employer must issue the final paycheck on the next payday, even if the exact amount is uncertain, an estimated payment must be provided.
Learn more about Michigan Labor Laws through our detailed guide.
Important Cautionary Note
When making this guide we have tried to make it accurate but we do not give any guarantee that the information provided is correct or up-to-date. We therefore strongly advise you seek advice from qualified professionals before acting on any information provided in this guide. We do not accept any liability for any damages or risks incurred for use of this guide.