Money

Michigan Minimum Wage 2026: $13.73 Now, $15 in 2027, and the Tipped Wage Phase-In

Michigan's minimum wage is $13.73 an hour in 2026 and rises to $15.00 on January 1, 2027. What tipped workers get, how the 2025 law changed the schedule, and what comes after 2027.

Michigan’s minimum wage is $13.73 an hour in 2026, and it rises to $15.00 on January 1, 2027 [1][2]. Tipped workers can be paid a lower cash wage, but that share is climbing every year under a law the Legislature passed in February 2025 [3].

At a glance

Minimum wage, 2026
$13.73 an hour since January 1, 2026 [2]
Tipped cash wage, 2026
$5.49 an hour (40%), tips cover up to $8.24 [1]
Next increase
$15.00 on January 1, 2027 [1][2]
Tipped share by 2031
50% of the full minimum wage [1]
Who must pay it
Employers with 2 or more employees [2]
Michigan minimum wage schedule under the 2025 law
StartingMinimum wageTipped cash wage (share)Tipped cash wage (per hour)
Feb 21, 2025$12.4838%$4.74
Jan 1, 2026$13.7340%$5.49
Jan 1, 2027$15.0042%$6.30
Source: Michigan Bar Journal: The winding road to minimum wage increase and paid sick time for Michigan workers (June 2025) · Checked 2026-10-29 · 2026 rates confirmed against U.S. Department of Labor tables; per-hour tipped amounts are the share times the full rate, rounded to the cent

What changed in 2025

On February 21, 2025, the governor signed Public Act 1 of 2025, which took effect right away [3]. It came after the Michigan Supreme Court ruled in 2024 that the Legislature’s handling of a ballot-initiated wage law broke the state constitution, and gave lawmakers time before the original law took effect [3].

The 2025 law did three main things [3]:

  • Raised the wage faster. The rate went from $10.56 to $12.48 on February 21, 2025, then to $13.73 in 2026, and to $15.00 in 2027.
  • Kept the tip credit, but shrank it. The ballot initiative had aimed to end the tip credit . The 2025 law kept it, but the cash wage employers must pay tipped workers rises every year as a share of the full minimum wage.
  • Kept managers out of tip pools. Managers and supervisors can’t share in employees’ tip pools or take any part of their tips.

Tipped workers: the phase-in

In 2026 the cash wage for tipped workers is $5.49 an hour, which is 40% of $13.73. Tips can count for the other $8.24 [1]. If a worker’s wages plus tips don’t add up to at least $13.73 for every hour worked, the employer has to pay the difference.

The share goes up each year: to 42% in 2027 [3], when the full rate is $15.00, and on up until the tipped cash wage reaches 50% of the state minimum wage in 2031, according to the U.S. Department of Labor [1].

After 2027

Once the rate reaches $15.00, it’s adjusted each year for inflation [1][2]. The state treasurer multiplies the rate by any increase in the Midwest consumer price index, and the new rate takes effect the following January. The increase is skipped for a year when Michigan’s unemployment rate for the year before was 8.5% or higher [3].

Who’s covered

Michigan’s law applies to employers with 2 or more employees [2]. Because the state rate is higher than the federal one, it also applies to jobs covered by the federal Fair Labor Standards Act [2]. Overtime pay starts after 40 hours in a workweek [2].

If you’re underpaid

Write down your hours, pay and tips. Michigan’s Department of Labor and Economic Opportunity (LEO) Wage and Hour Division takes complaints about unpaid minimum wage and overtime; its pages are at michigan.gov/leo.

Sources

  1. U.S. Department of Labor: Minimum Wages for Tipped Employees (state table, revised July 1, 2026)
  2. U.S. Department of Labor: State Minimum Wage Laws (updated July 1, 2026)
  3. Michigan Bar Journal: The winding road to minimum wage increase and paid sick time for Michigan workers (June 2025)

Common questions

What is the minimum wage in Michigan in 2026?

$13.73 an hour since January 1, 2026, for employers with 2 or more employees. It goes up to $15.00 an hour on January 1, 2027.

What is the tipped minimum wage in Michigan in 2026?

$5.49 an hour in cash, which is 40% of the full minimum wage. Tips can cover up to $8.24 of each hour, but if wages plus tips come to less than $13.73 an hour, the employer has to make up the difference.

Will Michigan's tipped wage keep going up?

Yes. Under the 2025 law, the tipped cash wage rises as a share of the full minimum wage each year, to 42% in 2027, and the U.S. Department of Labor reports it reaches 50% of the state minimum wage in 2031.

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