Campaign launches to hold referendum on Michigan's new minimum wage law
Advocates for eliminating the lower minimum wage for restaurant servers and other workers who receive customer tips recently announced their campaign to place a referendum on the November 2026 ballot asking voters to repeal the state's new minimum wage law.
The law that took effect in February emerged as a legislative compromise that preempted a Michigan Supreme Court order that would have eventually eliminated the lower minimum wage for tipped workers.
Compared to the court's order, the new law expedites the timeline for boosting the regular minimum wage earned by workers who don't receive tips. It also gradually increases the tipped minimum wage, but it doesn't eliminate it altogether. The referendum campaign to toss the law seeks to put the minimum wage changes in the Michigan Supreme Court order in place.
If organizers collect enough voter signatures, it will set the stage for a temporary suspension of the new minimum wage law before a statewide vote on whether to keep it. That would mean, before the election, tipped workers would see a temporary wage bump while workers earning the regular minimum wage would earn $0.44 less an hour compared with the current law.
Saru Jayaraman, president of the organization One Fair Wage supporting the referendum, blasted the Michigan restaurant lobby's description of the referendum campaign as a pay cut and said the group she leads has long pushed for higher minimum wages for all workers.
State Sen. Kevin Hertel, D-St. Clair Shores, who introduced the minimum wage legislation Gov. Gretchen Whitmer signed into law earlier this year, said slowing down the timeline for increasing the minimum wage would be bad for workers. He also said the policy to preserve a tipped minimum wage came after workers told him that's what they wanted. "I'll let people make up their own mind," he said on a potential referendum vote.
House Minority Leader state Rep. Ranjeev Puri, D-Canton, was the only top legislative leader to vote against Hertel's bill. In a statement, he didn't say whether he would support a referendum to repeal the new minimum wage law, but he said the process is "a critical way for the people of our state to make their voices heard, particularly on issues they feel their government is unresponsive on."
In 2018, a campaign to put a proposal on the ballot to raise the minimum wage and eliminate the tipped minimum wage never had a chance to put the issue to a statewide vote.
Instead, Republican lawmakers blocked a vote by adopting the proposal before the election. After the election, they watered down the minimum wage changes to keep the lower tipped minimum wage intact.
The legal fight that followed ended with a Michigan Supreme Court decision in July 2024 calling GOP lawmakers' "adopt and amend" maneuver illegal and ordering the original minimum wage proposal to take effect starting Feb. 21. The court set a timeline to increase the minimum wage and gradually phase out the lower tipped minimum wage. That prompted lawmakers to scramble to stop the court order eliminating the lower minimum wage from taking effect.
Most states have one minimum wage for workers who don't earn tips, and a lower minimum wage for those who do. If customers' tips don't close that gap, the employer pays the difference. The Michigan Supreme Court order phasing out the tipped minimum wage would have made Michigan the first state to eliminate the lower wage for tipped workers in decades.
But Gov. Gretchen Whitmer signed Hertel's bill into law the same day the court order was scheduled to take effect. She has celebrated the legislation as evidence lawmakers can work together across the aisle. The restaurant lobby celebrated the new law, but it angered labor advocates, including One Fair Wage, which had floated gathering signatures to pursue a voter referendum during the legislative debate on the minimum wage. A June 11 notice from the Michigan's Bureau of Elections sets out the deadlines for providing public comment on the summary for the referendum petition and the election panel's approval, which typically kicks off the process for gathering signatures to land a spot on the ballot.
The referendum campaign immediately garnered pushback from the Michigan Restaurant and Lodging Association, whose President and CEO Justin Winslow said it "would ironically deliver the very pay cuts they claim to oppose" in a statement.
Earlier this year, Michigan's new minimum wage law increased the minimum wage from $10.56 to $12.48 an hour, which matches the scheduled increase included in the court's minimum wage order. But starting next year, the new law kicks in a higher increase to the minimum wage than the court's order, with a minimum wage of $13.73 instead of $13.29. In 2027, the law sets the minimum wage at $15 instead of the $14.16 in the court order. Under the law, subsequent increases to the minimum wage are tied to inflation whereas the schedule in the court order set the minimum wage at $14.97 in 2028, before tying future increases to inflation.
But the court's order set a higher tipped minimum wage compared to the new law, which caps the tipped minimum wage at 50% of the regular minimum wage starting in 2031. The court order, meanwhile, eliminates the lower tipped minimum wage starting in 2030.
Jayaraman said the referendum campaign hopes to submit signatures this year, in time for the state's elections panel to determine enough signatures were collected to suspend the new law and put in place the court-ordered changes before the minimum wage is set to increase to $13.73 next year.
The Free Press asked Jayaraman about the possibility of pursuing an initiative that would preserve the expedited timeline for increasing the minimum wage in the current law and eliminating the lower tipped minimum wage instead of a referendum. She suggested the restaurant lobby calling the referendum a pay cut has more resources than the organization she leads and could pitch in to support such an initiative. "And so we are continuing to fight with what we have for the lowest wage workers in Michigan and for all workers in Michigan," she said. That means at least putting the court-ordered changes in place, she said.
Jayaraman said One Fair Wage is part of a coalition that's coming together for the referendum, but she said the group's other members would be announced later.
Chris White, director of ROC Michigan, a restaurant workers' advocacy group that was a plaintiff in the Michigan Supreme Court case, said in a June 12 phone call that his organization has not yet been approached by the campaign.
Michigan AFL-CIO President Ron Bieber spoke at a One Fair Wage news conference at the beginning of the year to express opposition to legislation to diminish the court's minimum wage ruling. Chad Cyrowski, Michigan AFL-CIO communications director, said in a statement June 12: "Every single Michigander deserves a good-paying job with strong workplace protections — and the Michigan AFL-CIO will continue advocating for them. We have not had a chance to review this proposal with our affiliates and have not taken a position on it."
Contact Clara Hendrickson: chendrickson@freepress.com or 313-296-5743.
This article originally appeared on Detroit Free Press: New campaign wants Michigan voters to toss minimum wage law
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