On February 21, 2025, the Michigan Earned Sick Time Act (ESTA) officially took effect, replacing the Paid Medical Leave Act (PMLA) and expanding sick time benefits for employees across the state. ESTA imposes new compliance requirements on Michigan employers and significantly broadens employee eligibility for paid sick leave. However, just before the law went into effect, Michigan Governor Gretchen Whitmer signed a last-minute amendment making several key changes.

Key Changes Under ESTA

1. Updated Definition of “Employee”

The amended ESTA narrows the definition of “employee” by excluding the following categories:

• Individuals employed by the U.S. government;
• Unpaid trainees or unpaid interns;
• Individuals employed under the Youth Employment Standards Act; and
• Individuals working under an employer policy that:
  1. Allows the individual to self-schedule their working hours; and
  2. Prohibits the employer from taking adverse action if they choose not to work a minimum number of hours.

2. Sick Time Accrual

Under ESTA, employees now accrue 1 hour of sick time for every 30 hours worked, with different requirements based on employer size:

• Employers with 10 or fewer employees must provide 40 hours of paid earned sick time annually, but have until October 1, 2025, to begin providing this benefit.
• Employers with 11 or more employees must provide at least 72 hours of paid earned sick time annually.

Notably, unlike the original version of ESTA, the amended Act does not require unlimited carryover of unused sick time. Instead, employers may cap carryover at:

• 72 hours for employers with 11 or more employees, and
• 40 hours for employers with 10 or less employees.

Employers may restrict the use of accrued sick time until an employee reaches their 120th calendar day of employment.

3. Frontloading and Carryover Options

Employers that choose to frontload the 72 hours at the start of the year are:

• Not required to allow carryover of unused sick time.
• Not required to calculate or track accrual of sick time.
• Not obligated to pay out unused sick time at the end of the year.

If an employee separates from employment and is rehired within two months, their unused sick time must be reinstated.

4. Updated Leave Request & Documentation Rules

If the need for paid earned sick time is foreseeable, employers can require up to seven days’ advanced notice.

If the need is unforeseeable, employers may require employees to give notice either:

• As soon as practicable, or
• In accordance with the employer’s written sick time policy, if:
  • The employer provided the policy in writing after February 21, 2025, and
  • The policy allows employees to provide notice after becoming aware of the need for sick time.

Employers may request reasonable documentation for absences lasting three (3) or more consecutive days. Employees must be given at least 15 days to provide the requested documentation, and employers are required to reimburse any out-of-pocket expenses the employee incurs in obtaining it. Unlike the original version of ESTA, the amended Act allows employers to take adverse personnel action if an employee uses paid earned sick time for a purpose not covered under the law.

5. Protections and Enforcement Updates

The amended ESTA prohibits an employer, or any other person, from interfering with, restraining, or denying the exercise of, or the attempt to exercise, any right protected under the ESTA. It also prohibits an employer from taking retaliatory personnel action or discriminating against an employee because the employee has exercised a right under the ESTA.

The amended ESTA also removed the rebuttal presumption of a violation of the ESTA if an employer took an adverse personnel action against a person within 90 days after that person engaged in certain protected activities under the ESTA.

Unlike the original ESTA, the amended ESTA does not provide employees a private cause of action.

Final Thoughts

With ESTA now in effect, Michigan employers must ensure compliance with the expanded sick leave provisions to avoid potential legal exposure. Given the last-minute changes, employers should review their policies, update their employee handbooks, and communicate these changes to their workforce.

For guidance on ESTA compliance or assistance with policy implementation, contact one of the employment attorneys at MHS.