The bill sponsored by Senate Majority Leader Randy Richardville, R-Monroe, passed 24-14 on Thursday with bipartisan support and now goes to the House, where its future is uncertain. It would raise the minimum wage to $8.15 an hour in September, and then to $9.20 by January 2017 in three 35-cent increments.
"Everybody gained a little bit here and everybody lost a little bit here," Richardville said. "But I think it was good legislation. I think that businesses can plan now for the future."
House Speaker Jase Bolger, R-Marshall, has "grave concerns" about some aspects of the bill, which will be closely reviewed in the House, Bolger spokesman Ari Adler said. He didn't specify a timeline for moving the bill through that chamber.
Republican Gov. Rick Snyder will also review the legislation, which he thinks deserves "an open discussion," according to spokeswoman Sara Wurfel.
Fourteen Senate Republicans and 10 Democrats voted for the bill, while 12 Republicans and two Democrats voted against it.
Richardville designed the bill to nullify an ongoing ballot drive to amend current law to $10.10 an hour by 2017. His bill would repeal the existing wage law and enact a new one, rendering the ballot measure moot.
Richardville proposed a target wage of $8.15 last week but changed it to $9.20 on Thursday after negotiating with Republican and Democratic lawmakers.
The bill would allow the minimum wage to rise by up to 4 percent annually to adjust for inflation starting in October 2017, a measure that wasn't included in the original bill. Democrats say it will limit the need for future legislative action on the issue.
Employees who receive tips, such as restaurant waiters, would see their minimum wage gradually rise to $3.50 an hour from $2.65 an hour by 2017 under the bill. Ballot drive organizers seek to secure a $10.10 minimum wage for those workers, too.
The campaign led by the Raise Michigan coalition has collected more than the 258,000 signatures needed for the measure to appear on the November ballot, organizers said Tuesday.
President Barack Obama has called for a rise in the national minimum wage to $10.10 per hour but Congress has not acted so far.
Raise Michigan member Dessa Cosma-King said Thursday the campaign will continue its efforts passage of the bill.
"It's disappointing to see the Republican-controlled legislature hell-bent on derailing our grassroots effort to help lift Michigan families out of poverty," Cosma-King said in a statement. "The bill they passed today just doesn't go far enough to help struggling Michiganders."
Under Richardville's bill, Michigan's minimum wage would rise to $8.15 an hour on Sept. 1, $8.50 on Jan. 1, 2015, $8.85 a year later and $9.20 on Jan. 1, 2017. It would be adjusted for inflation every October starting in 2017, and could not increase if the state unemployment rate is above 10 percent at any time in the previous year.
Democratic candidate for governor Mark Schauer visited the Senate after the vote and congratulated Richardville on the measure, which Schauer said was "almost identical" to an increase he proposed in November.
"I'm thrilled," Schauer said. "This is the kind of bipartisanship we need at the state capital. This will give a million low-wage earners a raise in Michigan."