Michigan restaurants prepare for pay increases for workers with new laws

DETROIT (FOX 2) - For many workers, it’s a great way to start the new year. Michigan’s minimum wage will increase twice in 2025.

But some in the hospitality industry are rejecting the increase as they worry it could do more harm than good.

The owner of Brady’s Tavern recognizes the hospitality industry has its challenges.

"We couldn’t renegotiate a lease. We’re closing up shop for economic reasons," said owner Bob Berg.

The entrepreneur is confident he’ll find a new location soon and that’s why he’s also concerned about how an increase in the minimum wage will impact the restaurant industry.

"It would overtime become a burden, something that we would have to address in the form of menu price increases," he said. 

The state's minimum wage is currently $10.33. But on Jan. 1, 2025, it will increase to $10.56 and on Feb. 21st of next year it will increase to $12.48.

But Save MI Tips wants tipped workers left out of the minimum wage increase equation.

"We’re asking the legislature to step in and make an adjustment for tipped workers, only leave the regular minimum wage alone; it can go up as the law prescribes," said John Sellek of Save MI Tips.

Many tipped workers don’t want minimum wage jobs because they say their tips allow them to make more than a minimum wage job.

"They do this unique line of work where they have an arrangement with the customer where their ability to deliver good service can result in making double or triple the minimum wage," said Sellek.

Many say they want the governor and law. Makers have to do more to protect tipped-wage workers.

"We just need leadership in the legislature and the governor to let this vote go up on the board in the legislature. We think it's going to pass easily once it’s allowed to go on the board, and we can fix this thing before it’s fully implemented in February," Sellek said.