Michigan · private-sector compensatory time · MCL 408.934a(8)
Michigan private compensatory time
MCL 408.934a(8) / Improved Workforce Opportunity Wage Act: a private-sector employee may take not less than 1.5 hours of time off per overtime hour instead of cash — only if the employer allows ≥10 paid leave days/year and there is a CBA/MOU/written plan with a voluntary written request before the OT. Accrual cap 240 hours (no public-safety 480). Over the cap → cash 1.5×. Classic $20 × five 10h, bank 0 → $800 cash + 15h accrued vs /overtime/ $1,100 vs /flsa-7o-comp-time/ private $1,100. At the 240h cap → $1,100 cash. Cash-out / termination at the RR earned when the OT was performed (not 7(o) 3-year average). Not public-agency 7(o).
How Michigan private comp time pays
IWOWA § 4a(1) requires cash 1.5× after 40. Subsection (8) lets a covered employee bank compensatory time off at not less than one and one-half hours for each overtime hour instead of cash that week — but only when the employer allows a total of at least 10 days of leave per year without loss of pay and provides the bank under a CBA/MOU/other written agreement, or under a written employer plan with an express voluntary written request by the employee before the overtime assignment (MCL 408.934a(8)(a)). The election cannot be a condition of employment (8)(c). Accrual may not exceed 240 hours (8)(d).
Classic $20 × five 10-hour days. 50 hours → 10 overtime hours. Empty bank, 240-hour cap, 10 leave days, agreement, not FLSA-covered: 10 × 1.5 = 15 hours accrued; cash is 40 × $20 = $800 versus $1,100 on /overtime/ and versus $1,100 on /flsa-7o-comp-time/ for a private employer (7(o) denies private). A 35-hour week is still $700 with nothing accrued. At the 240-hour cap there is no room: the same 50-hour week is cash $1,100. Bank 237 (3 hours of room): 2 overtime hours become 3h off + 8 overtime hours cash $240 → $1,040, bank 240.
Gates off → cash. Uncheck 10 paid leave days, uncheck the agreement/request, uncheck IWOWA coverage, or check FLSA-covered private: the week pays like /overtime/ ($1,100), zero accrued. FLSA-covered private employees generally cannot substitute federal OT with a private bank — § 7(o) is public-agency only.
Cash-out and termination. On request, unused bank must be paid within 30 days at the regular rate earned when the employee performed the overtime work (8)(e). On voluntary or involuntary termination, unused bank is paid at that same OT-time RR (8)(f) — not FLSA § 7(o)’s greater of the 3-year average or final RR. Forty hours at $20 with a 10-hour bank → $1,000 ($800 + $200). Same facts under 7(o) with a $25 three-year average → $1,050.
$20 · five 10h · bank 0 → $800 cash + 15h accrued (FLSA cash $1,100; 7(o) private $1,100).
$20 · five 7h (35h) → $700, 0 accrued.
$20 · five 10h · bank 240 → $1,100 cash, 0 accrued.
$20 · five 10h · bank 237 → $1,040 + 3h (bank 240).
No 10 leave days · five 10h → $1,100 cash.
FLSA-covered private · five 10h → $1,100 cash.
40h · bank 10 · terminate @ $20 OT-time RR → $1,000 (vs 7(o) $25 3-yr → $1,050).
Sources
- MCL 408.934a — IWOWA overtime + § 4a(8) compensatory time (Michigan Legislature, HTTP 200)
- MI LEO WHD-9909 Comp Time information sheet — 10 leave days / 1.5× / 240h summary (HTTP 200)
- 29 U.S.C. § 207(o) — public-agency cousin contrast (Cornell LII, HTTP 200)
FAQ
How does Michigan private comp time pay?
1.5 hours of time off per overtime hour instead of cash, with a 240-hour cap and a ≥10 paid leave days/year gate. Classic $20 × five 10h, bank 0 → $800 + 15h vs /overtime/ $1,100.
Same as /flsa-7o-comp-time/?
No. /flsa-7o-comp-time/ is public-agency only, allows a 480-hour safety cap, and terminates at the greater of the 3-year average RR or final RR. Here a private employer can bank under IWOWA; termination uses the OT-time RR. Same classic private week: 7(o) cash $1,100; Michigan $800 + 15h.
Same as /overtime/?
No. /overtime/ always pays cash 1.5× after 40 ($1,100 on the classic week). Here the classic week is cash $800 plus a 15-hour bank unless a gate or the 240h cap forces cash.
FLSA-covered private employee?
Check the FLSA-covered toggle — federal cash OT typically controls and the bank is off ($1,100). This page models the IWOWA private-sector bank when Michigan law supplies the OT row.
Who is covered?
Non-exempt employees subject to IWOWA § 4a with the 10 leave-days gate and a voluntary written request/CBA before the OT. This page does not decide FLSA coverage or exemption status.