Tri-City Sun

State Representative Timmy Beson has urged the Michigan Legislature to address a recent Michigan Supreme Court decision affecting small businesses and workers. The court's ruling, made in July, increases the minimum wage and eventually removes the tip credit for certain service industry employees. Beson emphasized that these changes could negatively impact local job providers, their employees, and consumers in Bay County and throughout Michigan.

In 2018, the Michigan Legislature adopted two citizen-initiated laws to increase the minimum wage and introduce new paid sick leave rules. These laws were later amended to balance economic growth with worker protection. According to Beson, "Our small business sector employs more than 450,000 people statewide and circulates tens of billions of dollars annually. It’s a huge piece of our state and local economies." He warned that businesses might close, lay off workers, or raise prices due to the court's decision.

Beson stated that several bills would be discussed in the coming weeks to prioritize solutions before the changes take effect in February. He stressed the need for an approach that considers all perspectives: "We need a better way forward that understands all sides of this equation."

A survey by the Michigan Restaurant and Lodging Association highlighted potential consequences if extreme elements from the original proposal are implemented as mandated by the Supreme Court. Over 92% of restaurants indicated they would have to raise prices, with many expecting increases between 20-25% by early 2025. Additionally, 66% of restaurant owners said they might have to lay off employees, while 20% feared closure.

Another survey revealed that 83% of Michigan restaurant servers preferred retaining the tipping system. Furthermore, 79% expressed concerns about job loss if tip credits were eliminated. Similar legislation enacted earlier this year in California led to closures, layoffs, reduced hours, and increased use of self-service kiosks.

In September, hundreds of restaurant and bar workers gathered at Lansing's state Capitol demanding legislative changes similar to previous efforts.