Governor Rick Snyder has signed into law legislation that will increase Michigan's minimum wage to $9.25 per hour by 2018.
Under the compromise bill, which received bipartisan support in both chambers of the state Legislature Tuesday, the minimum wage will gradually increase from $7.40 to $9.25 per hour by 2018.
Meanwhile, the rate for tipped employees will be 38 percent of the regular minimum wage.
The wages will rise based on a five-year rolling average of inflation, but no more than 3.5 percent.
The governor says, "This is something that’s good for Michigan, it’s good for the hardworking people of Michigan, and I believe economically sound in terms of hopefully creating an environment for long-term economic success."
The legislation differs from the bill that passed a House committee earlier Tuesday that would have raised the wage to $8.50 without inflationary increases.
The action came a day before the Raise Michigan Coalition is expected to submit signatures for a voter-initiated act that would gradually raise the minimum wage to $10.10 per hour.
It's now unclear where the ballot proposal stands as it attempts to amend a minimum wage law that no longer exists, due to the governor's signing of the new law.