Effective Jan. 1, 2018, the minimum hourly wage will increase to $9.25 an hour.

This is the final scheduled increase provided for in Public Act 138 — the Workforce Opportunity Wage Act of 2014. Any future adjustments after January 2018 shall not exceed 3.5 percent and will be established by the state treasurer based on the unemployment rate and the consumer price index.

Public Act 138, took effect on May 27, 2014, replacing the Michigan Minimum Wage and Overtime Act (Act 154). WOWA is enforced by the wage and hour division — an agency within the Bureau of Employment Relations. The law generally applies to Michigan employers with two or more employees, age 16 and older.

A copy of WOWA and related resources including the required poster may be obtained by visiting the wage and hour division website at michigan.gov/wagehour.

The training wage remains at $4.25 an hour for newly hired employees aged 16 to 19 for the first 90 days of employment.

WOWA allows employers to take a tip credit on the state minimum wage rate under certain conditions for employees who customarily and regularly receive tips. Employees who are tipped may be paid 38 percent of Michigan’s minimum wage.

The following conditions apply to taking a tip credit on the state minimum wage rate:

• The employee must be in a position that customarily and regularly receives gratuities from a guest, patron or customer for services rendered to that guest, patron, or customer.

• If the gratuities plus the minimum hourly wage rate do not equal or exceed the minimum hourly wage that is otherwise established, the employer must pay any shortfall to the employee.

• The gratuities are proven gratuities as indicated by the employee’s declaration for the Federal Insurance Contribution Act.

• The employee has been informed by the employer of the provisions of Act 138.

If a credit is taken for gratuities received by an employee, then the employment records for each pay period shall contain the credit taken along with a written statement of the amount of gratuities received by the employee. The statement shall be signed by the employee and dated prior to the date on which the paycheck was received.

Employees covered by the overtime provisions of WOWA must be paid one and a half times their regular rate of pay for hours worked exceeding 40 hours in a work week.

For further information, please call the toll-free telephone number of the wage and hour division at (855) 464-9243 or visit the agency’s website at michigan.gov/wagehour.