What is the accrual formula under Michigan’s Earned Sick Time Act?

Under MCL 408.963, covered employees accrue at least 1 hour of earned sick time for every 30 hours worked. The statute does not impose an absolute accrual cap, meaning hours continue to accrue proportionally as hours are worked.

What are the annual paid use caps under Michigan ESTA?

For larger employers with 11 or more employees, the annual paid use cap is 72 hours. For small employers with 10 or fewer employees (subject to statutory classification requirements), the annual paid use cap is 40 hours.

When did the Michigan Earned Sick Time Act take effect?

Under 2025 Public Act 2, the act took effect on February 21, 2025 for larger employers with 11 or more employees. Small employers with 10 or fewer employees became subject to the act on October 1, 2025, with a delayed effective date of up to 3 years from the date of the employer’s first hire for businesses whose first employee was hired after February 21, 2022.

Can an employer require a waiting period before an employee uses sick leave?

Yes. Under MCL 408.963(4), an employer may establish a waiting period of up to 120 calendar days from the date of hire before a new employee is permitted to use their accrued earned sick time.

Michigan Wage Compliance Guide • Reviewed October 14, 2026

Michigan Earned Sick Time Act Rules: 2025 PA 2 Accrual & Caps

An authoritative legal guide to Michigan’s revived Earned Sick Time Act (ESTA) under 2025 Public Act 2 (MCL 408.961 et seq.), the 1:30 accrual ratio, small business rules, annual usage caps, carryover mandates, and waiting period limits.

Direct Answer Summary

Following the Michigan Supreme Court's decision in Mothering Justice and the enactment of 2025 Public Act 2, all covered employees in Michigan accrue 1 hour of earned sick time for every 30 hours worked under MCL 408.963. Unlike earlier versions, mathematical accrual is uncapped. Employers may limit annual paid usage to 72 hours (larger employers with 11+ employees) or 40 hours (small employers with 10 or fewer employees). Unused time carries over to the subsequent year up to the annual cap. Employers may impose up to a 120-calendar-day waiting period for new hires. Unused ESTA sick time is not required to be cashed out upon separation (MCL 408.964(5)).

Check Your Earned Sick Time With Our Calculator

Audit accrued hours, check small business eligibility, verify annual usage caps, and test waiting period rules.

Open Earned Sick Time Calculator →

1. Statutory History: Mothering Justice & 2025 PA 2

The history of Michigan's paid sick leave law is defined by major judicial and legislative action. In 2018, voters initiated the Earned Sick Time Act. Before it went to the ballot, the Legislature adopted it and subsequently amended it into the far more restrictive Paid Medical Leave Act (PMLA).

In July 2024, the Michigan Supreme Court held in Mothering Justice v. Attorney General that the adopt-and-amend tactic violated Article 2, Section 9 of the Michigan Constitution. To provide an orderly statutory framework, the Legislature enacted 2025 Public Act 2, replacing the PMLA and reviving the Earned Sick Time Act with comprehensive clarifications.

2. Accrual Rates & Small Business Distinctions

Under MCL 408.963, all non-exempt and exempt employees accrue earned sick time at the uniform rate of 1 hour for every 30 hours worked.

Employer Size Thresholds & Annual Caps

Larger Employers (11+ Employees)

Effective date: February 21, 2025.
Annual paid usage cap: 72 hours.
Annual carryover cap: 72 hours.

Small Employers (10 or Fewer Employees)

Effective date: October 1, 2025.
Annual paid usage cap: 40 hours.
Annual carryover cap: 40 hours.
Eligible new small businesses: up to 3 years from date of first employee hire before coverage applies.

3. Waiting Periods & Usage Rules

Under MCL 408.963(4), earned sick time begins accruing on the first day of employment. However, employers may establish a waiting period of up to 120 calendar days following hire before an employee may use their accrued balance.

Earned sick time may be used in the smaller of hourly increments or the smallest increment the employer uses to account for other absences. Qualifying reasons include:

Mental or physical illness, injury, or health condition of the employee or their family member.
Medical diagnosis, care, treatment, or preventative medical care.
Absences due to domestic violence or sexual assault (medical, counseling, legal, or relocation).
Closure of the employee's primary workplace or child's school due to a public health emergency.

4. Worked Numerical Examples

Example A: Full-Time Employee (Non-Small Employer)

Employee works 2,400 hours during the year for a 50-person firm. Accrual = 2,400 ÷ 30 = 80.0 hours accrued (unlimited accrual). Paid usage cap = 72.0 hours. Maximum carryover to next year = 72.0 hours.

Example B: Small Business Part-Time Employee

Employee works 1,200 hours for a 5-person company after October 1, 2025. Accrual = 1,200 ÷ 30 = 40.0 hours accrued. Annual paid use cap = 40.0 hours. Fully compliant.

Example C: 120-Day Waiting Period Restriction

New hire logs 300 hours during their first 60 days of employment (10 hours accrued). The employer maintains a lawful 120-day waiting period policy. Because only 60 days have elapsed since hire, the employee cannot yet use the 10 accrued hours for paid absence.

5. Official Regulatory Authorities & Citations

Statutory Authority: MCL 408.961–408.974 – Earned Sick Time Act (ESTA).
Enacting Statute: 2025 Public Act 2 (replacing 2018 PA 369 / PMLA).
Judicial Mandate: Mothering Justice v. Attorney General, 514 Mich. 256 (2024).
Enforcement Body: Michigan Department of Labor and Economic Opportunity (LEO) Wage and Hour Division.
Separation Payout Exclusion: MCL 408.964(5) – No mandatory cashout upon separation.

← Return to Michigan State Hub Open the Earned Sick Time Calculator →