As of February 21, 2025, Michigan’s Earned Sick Time Act is officially in force bringing major implications for staffing agencies and employers statewide. This legislation requires most Michigan employers to offer paid sick leave to their employees, including many temporary and contract workers commonly placed by staffing firms.
🧾 What Does the Act Require?
The Earned Sick Time Act mandates that:
- Employers must provide 1 hour of paid sick leave for every 30 hours worked.
- Employees can accrue up to 40 hours of paid sick time per year.
- Leave can be used for:
- The employee’s own illness or medical appointments,
- A family member’s illness or care needs,
- Instances of domestic violence or sexual assault (including related legal and support services).
This law applies to all employers with at least one employee, though the accrual and usage rules vary slightly based on business size.
What It Means for Staffing Firms
Staffing firms are often in a unique position when it comes to labor laws. Because your firm is the legal employer of record for temporary workers, you’re responsible for ensuring compliance with this new sick leave requirement even if your clients are the ones directing day-to-day work.
Key implications:
- Payroll Adjustments: Systems must be updated to track hours worked and calculate accrued leave for temporary employees.
- Employee Communication: Your firm should clearly explain the new policy to workers including how they can request leave and what documentation may be required.
- Contract Clarity: It’s critical to define who bears the cost of sick leave in contracts with clients. Will your agency absorb the cost, or will you pass it through in your bill rates?
Penalties for Non Compliance
Failing to comply with the Earned Sick Time Act can result in:
- Fines,
- Legal action from employees,
- Damage to your firm’s reputation as a compliant, ethical employer.
What Should You Do Now?
To stay ahead:
- Review your current sick leave policies :Do they meet or exceed the new Michigan law?
- Audit your payroll and HR systems to ensure proper tracking and accrual of hours.
- Train internal staff and update handbooks to reflect the new sick time policies.
- Communicate with clients about how this may affect contracts and placements.
Final Thoughts
Legislation like Michigan’s Earned Sick Time Act represents a broader trend in employment law: expanding worker protections even for temporary and contingent employees. For staffing firms, compliance isn’t just about avoiding penalties it’s about staying competitive, building trust with workers, and strengthening long term client relationships.
Need help navigating compliance? Madison Resources can provide guidance and payroll solutions to make it easier for your firm to adapt to changing labor laws.
Explore our website to find more Legislative Updates. Madison Resources is the premier payroll funding and back office support partner to the staffing industry. Grow with confidence.