Missouri Repeals Paid Sick Leave Mandate — But Minimum Wage Still Rises to $15/hr in 2026

Background: What Proposition A Did — and What HB 567 Reversed

In November 2024, Missouri voters approved Proposition A by a margin of 57.6%, establishing two major labor law changes: a phased increase in the state minimum wage culminating at $15 per hour in 2026, and a new statewide earned paid sick leave (PSL) mandate requiring employers to provide one hour of leave for every 30 hours worked. The PSL obligation took effect May 1, 2025.

Just six weeks later, the Missouri Legislature passed House Bill 567. Governor Mike Kehoe signed the bill into law on July 10, 2025. The law did not contain an emergency clause, so the repeal of the PSL provisions took effect on August 28, 2025 — the first day of the General Assembly session following the signing. Because Proposition A was a statutory change (not a constitutional amendment), the Legislature was able to amend it without a voter referral.

Paid Sick Leave: Repealed Effective August 28, 2025

The earned paid sick leave mandate operated for approximately four months — from May 1 through August 27, 2025. During that window, employers with gross receipts over $500,000 were required to allow employees to accrue at least one hour of paid sick and safe leave per 30 hours worked, with employers with 15 or more employees allowing accrual of up to 56 hours per year, and those with fewer than 15 employees capping accrual at 40 hours per year.

As of August 28, 2025, Missouri employers are no longer legally required to provide PSL. The Missouri Department of Labor and Industrial Relations has confirmed that employers may voluntarily continue to offer paid sick leave, but the mandate itself has ended. Employers who had existing PSL policies prior to Proposition A taking effect are not required to maintain them under HB 567.

Minimum Wage: $15.00 Per Hour from January 1, 2026

The $15.00 minimum wage took effect January 1, 2026, as originally scheduled under Proposition A. HB 567 retained this increase in full. Missouri's minimum wage applies to private employers with annual gross receipts exceeding $500,000. Employers below that threshold may pay lower rates, though federal minimum wage rules may still apply if the employer engages in interstate commerce.

Tipped Employee Wages

Missouri permits a tip credit: employers may pay tipped employees a direct cash wage of at least 50% of the state minimum wage, with tips expected to bring total hourly compensation to the full $15.00 minimum. At the 2026 rate, the minimum direct cash wage for tipped employees is $7.50 per hour.

If an employee's tips do not bring total hourly earnings to $15.00, the employer must pay the difference. This tip makeup calculation must be applied on a workweek basis, not a per-shift or per-day basis. Overtime for tipped employees is also calculated on the regular minimum wage: time-and-a-half of $15.00 equals $22.50 per hour, which applies even to tipped employees when overtime is triggered.

Remaining Compliance Considerations

Although the PSL mandate has been repealed, employers should review and retain records of PSL accrual and usage for the May 1 – August 27, 2025 period. The Missouri Department of Labor can audit prior periods, and employees who experienced PSL violations during that window may still bring administrative complaints or civil actions. Anti-retaliation protections that existed under the PSL law during its effective period similarly remain relevant for any adverse action taken against employees for PSL-related activity before August 28.

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