Michigan’s Paid Time Off Law: Impact on Trucking Companies
Managing earned time off has always been a challenge in the trucking industry. With Michigan’s new Paid Time Off Law coming in 2025, this process is about to get even more complicated. For trucking companies already juggling tight delivery schedules and complex pay structures, this law raises a big problem: how do you provide paid sick leave for drivers who are paid by the mile or load, not by the hour?
If you’re a trucking company owner or manager, you’re likely feeling concerned about how these new regulations will fit into your business. It’s tough enough keeping trucks on the road and customers happy without adding more rules to the mix. And to make matters worse, the law doesn’t clearly explain how industries like trucking should track and calculate paid time off for non-hourly drivers.
In this article, we’ll dive into what we know about the law so far, how it might affect your company, and how you can start preparing. We’ll also share our current thoughts on possible solutions, but we’re waiting for more specific guidance from the state. Lawmakers may not fully realize how tough this will be for the trucking industry, so we expect more direction soon.
Michigan 2025 Paid Time Off Law: Essential Details
Michigan’s Earned Sick Time Act (ESTA) replaces the current Paid Medical Leave Act (PMLA) and becomes effective on February 1, 2025. This new law expands paid time off requirements to include all employers, regardless of their size. Under this law, workers will be able to earn up to 72 hours of paid sick leave each year. Companies that have fewer than 50 employees will still need to provide a mix of paid and unpaid leave.
The goal of the new law is to ensure that all workers in Michigan, including those in part-time or seasonal jobs, have access to paid sick time. Employees will be able to carry over unused hours from one year to the next, although employers can cap how much is used annually.
While the law is clear for hourly and salaried workers, it raises questions for industries like trucking, where most drivers are not paid in a traditional way.
Challenges of Michigan PTO Law for Per-Mile Truck Drivers
One of the biggest complications for trucking companies is that most drivers are paid by the mile or per load, not by the hour. This presents a unique challenge when it comes to tracking and calculating paid sick time. Since drivers don’t earn a fixed hourly wage, it’s unclear how companies will calculate their pay when they take time off.
For example, if a driver usually gets paid $0.60 per mile and averages 500 miles a day, how do you figure out their paid sick leave? This is a problem because trucking companies are not used to tracking hours for most drivers, and the law is not clear on how they should handle this situation.
Another issue is that the law counts all hours worked, not just the first 40 hours of a week, like many other laws. If the law stopped at 40 hours, it would be easier to manage by simply giving drivers 1.33 hours of PTO per week. But that’s not how it works. If a driver works 60 hours a week, they will earn two hours of PTO. This means trucking companies can’t just assume all weeks will be capped at 40 hours for time-off calculations.
We expect these issues to be addressed soon, and more guidance will likely come from the state once lawmakers understand how complicated this law is for the trucking industry. We’ve already asked the state for clarification on how it will specifically affect trucking companies, but we’re still waiting for an official response. As the 2025 deadline gets closer, we anticipate more details, especially since the current rules may not work well for drivers who aren’t paid by the hour.
Tracking PTO for Truck Drivers Under Michigan’s New Law
Right now, there’s no clear answer for how trucking companies should track paid time off for drivers paid by the mile or load. Here’s what we think might happen.
Converting Per-Mile Pay to Hourly for PTO Calculations
One possible solution could be to convert per-mile pay into an hourly equivalent. For example, if a driver typically earns $0.60 per mile and averages 60 miles per hour, the company could calculate that the driver earns $36 per hour. This hourly rate could then be used to calculate the driver’s paid sick leave. However, this approach assumes that mileage and hours remain consistent, which isn’t always the case in trucking.
Using a Base Hourly Rate for PTO in Trucking
Another potential approach is for companies to establish a base hourly rate for paid sick leave. This could be done by averaging a driver’s earnings over a specific period, such as the last three months. This average could then serve as the hourly rate for sick leave. However, this system might not fully account for the variability in a driver’s work and earnings, which can change from week to week.
Why ELD Logs Aren’t Suitable for PTO Tracking
Some might suggest using logged hours from electronic logging devices (ELDs) to track a driver’s working time. However, this isn’t a good solution for trucking companies. ELD data is used to track driving hours for compliance with federal Hours of Service (HOS) regulations, and we wouldn’t want to take those records into a courthouse to debate paid sick leave. ELD logs are designed for safety and compliance, not for payroll purposes, so using them to track paid time off could create legal headaches and raise questions about HOS compliance in unrelated matters.
Again, this is what we think will happen based on the current law. However, we are still awaiting direct answers from the state on how the law will apply to industries like trucking. We expect that there will be more direction coming once lawmakers realize that this approach may not work for drivers who don’t earn an hourly wage. Each possible solution has its challenges, especially if we don’t fully track hours. Even with good intentions, employees might feel shortchanged and could file a complaint with the Michigan Department of Labor.
Preparing Trucking Companies for Michigan’s 2025 PTO Law
Michigan’s new Paid Time Off Law will bring big changes to many industries, and trucking companies will face unique challenges in adapting to these rules. As most drivers are paid by the mile or load, figuring out how to calculate and track paid sick leave is going to be difficult.
Right now, we believe solutions like converting pay to hourly equivalents or setting a base hourly rate might work, but the law isn’t clear on how it will apply to non-hourly drivers.
We’ve reached out to the state for more information and are waiting for further guidance. In the meantime, trucking companies should start preparing by reviewing their payroll systems and thinking about how they will manage this change.
Stay tuned for updates as we learn more about how Michigan’s Paid Time Off Law will affect the trucking industry.
Written by Mike Ritzema
Before founding Superior Trucking Payroll Service, Mike was the CFO of a trucking company with 80 trucks and a thriving brokerage. This experience gave him the perspective that a payroll solution has to make the lives of the office people better. All the solutions he has designed are to benefit everyone. Our company mission is to help trucking families and that includes the company owners, the drivers, and the office.