This article addresses changes and updates to Minnesota’s earned sick and safe time law and paid leave law following the 2023-2024 Minnesota legislative session.
Click these links for a summary of changes to the Minnesota Human Rights Act and a number of other employment laws.
Changes to Paid/Earned Sick and Safe Time
In 2023, Minnesota enacted a comprehensive earned sick and safe time system that became effective on January 1, 2024 (click here for a detailed summary of the sick and safe time law). The 2024 Minnesota Legislature made updates and changes to this law. Here are the key highlights:
Minn. Stat. § 181.032 – Required Statement of Earnings by Employer; Notice to Employee
- The changes became effective on May 24, 2024.
- The amendments removed the requirement to provide, in the statement of earnings, (1) the total number of earned sick and safe time hours accrued and available for use, and (2) the hours used during the pay period on the statement of earnings.
- The law still requires that the employer provides this information in a “reasonable system” to each employee at the end of each pay period. In other words, employees still need to have access to and notice of their earned sick and safe time hours.
Minn. Stat. §§ 181.9445, 181.9446, 181.9447, and 181.9448 – Earned Sick and Safe Time (ESST) Law
- The changes became effective on May 24, 2024, except for the amendment to Minn. Stat. 181.9448, subd. 1(a), which will be effective on January 1, 2025.
- Here is a summary of the major changes:
- Base Rate – Minn. Stat. § 181.9445
- “Base rate” instead of “hourly rate” is now used throughout the Earned Sick and Safe Time (ESST) Law, and clarifies what this means for employees paid on an hourly basis at the same and different hourly rates, employees paid on a salary basis, and employees paid solely on commission, piecework, or other basis.
- The definition of “base rate” was clarified to exclude commissions, shift differentials, premium payments for overtime work, premium payments for work on certain days, or gratuities.
- Definition of Employee – Minn. Stat. § 181.9445
- The definition of “employee” has been modified to include someone who is anticipated by the employer to perform work for at least 80 hours in a year for that employer in Minnesota.
- The Legislature clarified who is not an “employee” to include a volunteer firefighter or paid on-call firefighter, an elected official or a person appointed to fill a vacancy as an elected official, and an individual employed by a farmer or family farm (including a corporation) for 28 days or less a year, in addition to independent contractors.
- Acceptable/Eligible Uses of Time – Minn. Stat. § 181.9447
- A couple of additional “eligible uses” were added for earned sick and safe time, including the “need to make arrangements for or attend funeral services or a memorial, or address financial or legal matters that arise after the death of a family member.”
- Documentation – Minn. Stat. § 181.9447
- The Legislature clarified that reasonable documentation for use of earned sick and safe time is required after “three consecutive scheduled workdays,” and if it cannot be obtained in a “reasonable time or without added expense,” then the employee can provide a written statement of the purpose for the use of earned sick and safe time.
- Tracking Hours – Minn. Stat. § 181.9447
- As indicated above, the total number of hours accrued and available for use and hours used during the pay period are no longer required on the statement of earnings, but that information must still be provided to each employee at the end of each pay period through a “reasonable system.”
- More Generous Policies – Minn. Stat. § 181.9448
- The Legislature also clarified that any sick time provided by an employer in excess of the law’s requirements must meet or exceed the standards required under the earned sick and safe time law.
- Remedies – Minn. Stat. § 177.50
- The Legislature confirmed that employers face potential liability if they are not in compliance with the ESST law in the following circumstances.
- If an employer does not provide ESST or does not allow use of ESST, then the employer is liable to all employees for all ESST that should or could have been provided at the employee’s regular rate of pay, plus an additional equal amount as liquidated damages.
- If an employer does not have the records sufficient to determine the ESST owed to employees, then the employer is liable to the employees for an amount equal to 48 hours of ESST for each year that ESST was not provided, plus an additional equal amount as liquidated damages.
- The Legislature confirmed that employers face potential liability if they are not in compliance with the ESST law in the following circumstances.
- Base Rate – Minn. Stat. § 181.9445
Changes to Minnesota’s Paid Leave Law
The 2023 Minnesota Legislature enacted a comprehensive Family and Medical Benefits/Leave Program that is set to become fully effective on January 1, 2026. See Minn. Stat. § 268B. For background and a detailed analysis of this program, please click here.
In summary, this leave program will function in a similar manner to unemployment insurance. Employers will pay premiums to a system managed by the Minnesota Department of Employment and Economic Development (DEED), and employees will essentially apply for leave benefits when needed.
The 2024 Minnesota Legislature made some updates and changes to this law, most of which become effective over time: July 1, 2025, November 1, 2025, or January 1, 2026. Only the changes to definitions became effective on May 24, 2024. Here are the key highlights:
- The Legislature changed the law with regard to premium amounts, and it created a process to allow DEED to adjust annual premium rates. It is currently predicted that when the program launches in January 2026, wages will be taxed at 0.88% in order to adequately fund the new program. Employers can still pass 50 percent of this premium on to employees.
- The Legislature modified a number of definitions, including covered individuals, family member (which now includes the child of a domestic partner), financially eligible, initial paid week, typical workweek, and more.
- The Legislature clarified the weekly benefit amount for an applicant that changed employers within the base period.
- This amount will be calculated based on the highest quarter of wages in the base period.
- The minimum increment of leave is now defined as, at most, one calendar day.
- The Legislature created an appeals process, which includes provisions for filing, hearing, reconsideration, withdrawal, a proceeding with a hearing officer designated by the commissioner of the Department of Employment and Economic Development, including representation, and an appeal of right to the Minnesota Court of Appeals.
- The Legislature added a small employer premium rate for employers with 30 or fewer employees, and small employers will be allowed to apply for assistance grants from DEED.
- The Legislature added data privacy requirements that limit disclosure of data unless in accordance with a court order or to specific government entities.
We anticipate that the Minnesota Family and Medical Benefits/Leave Program will continue to evolve before it launches on January 1, 2026. We will continue to monitor developments regarding this program.
FMJ’s HR & Employment Law Practice Group is available to help review your company’s HR and employment practices, draft new policies and practices, and create and implement strategies for the future. In addition to earned sick and safe time and the Medical Benefits/Leave Program, there have been amendments to the Minnesota Human Rights Act and a number of other recent employment law changes in Minnesota. If you are interested in connecting with the team to discuss questions or concerns about any of these new changes, or any other HR and employment law matters, please contact V. John Ella, Natolie Hochhausen, and the HR & Employment Law Practice Group.
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