Starting January 1, 2024, all Minnesota employers will be required to provide time off to their employees for illnesses and certain safety-related reasons under a new statewide Earned Sick and Safe Time law (there are currently local sick and safe time ordinances in Minneapolis, St. Paul, Bloomington, and Duluth). To help familiarize employers with some of the key aspects of this new law and how it will affect their business, this article provides a brief, high-level overview of what sick and safe time is, what the law requires, and what actions employers will need to take before January 1, 2024 to ensure that their business is compliant.
What is Sick and Safe Time?
The new law will require paid time off for almost all Minnesota employees. The accrued time can be used for a variety of reasons, including the following (among others):
- When an employee has an illness, injury, or other health condition, needs a diagnosis for such health-related matters, or needs to seek preventative care;
- When an employee must be absent from work to care for a family member (as that term is defined under the new law) who has a health condition, or who needs to seek diagnosis or preventative care for such condition;
- When an employee needs to take certain steps relating to domestic abuse, sexual assault, or stalking of the employee or their family member; and
- When an employee must be absent from work to care for a child staying home as a result of a school closure.
Who is Eligible for Sick and Safe Time?
The Earned Sick and Safe Time law will apply broadly to any employee who has performed at least 80 hours of work in Minnesota in a year.
- This includes part-time, temporary, and other employees of a company, as long as they have performed at least 80 hours of work in a year.
- It also means that the law will apply to out-of-state employers with employees performing their work in Minnesota.
The new law will apply to all Minnesota employers, regardless of headcount size. In other words, there is no small-employer exemption. However, employers will not be required to provide sick and safe time to independent contractors.
How does the Earned Sick and Safe Time Accrue?
Sick and safe time may accumulate either on an as-accrued basis throughout the year, or on a frontloaded basis at the start of each year, at the employer’s discretion.
Under the as-accrued method, covered employees generally would accrue one hour of sick and safe time for every 30 hours worked, up to a maximum 48 hours accrued in a year, unless the employer agrees to a higher amount. Employers electing to use the as-accrued method must allow covered employees to carry any unused accrued sick and safe time over from one year to the next, but they may cap the total accumulation of sick and safe time at 80 hours. This means that once an employee’s total accumulated balance reaches 80 hours, they would not accrue additional sick and safe time until they use some of their accrued time.
Alternatively, employers may elect to frontload either 48 hours or 80 hours of sick and safe time to each covered employee’s balance at the start of each year. If the employer frontloads 48 hours, the employer must pay out any unused accrued sick and safe time remaining in an employee’s balance at the end of the year, at the employee’s regular rate of pay. The employer may avoid this payout requirement by instead frontloading 80 hours of sick and safe time at the start of each year. Under the frontload method, employees would not accrue additional sick and safe time during the year and would not be entitled to carry over any unused sick and safe time from one year to the next.
Whether frontloading makes sense for any individual employer can depend on a number of factors, including an employer’s rate of employee turnover and whether or not employees work a predictable number of hours in a year. If this is an option that interests your company, please reach out to our employment team to discuss potential options.
Please note that for purposes of the Earned Sick and Safe Time law, a “year” is 12 consecutive months, but the employer has discretion to determine when the 12-month period starts. For example, an employer may choose to start the 12-month period at the beginning of its fiscal year. It could also choose to start the 12-month period at the employee’s work anniversary. Whatever decision an employer makes regarding the 12-month period will need to be clearly communicated to employees and apply uniformly to all similarly situated employees.
What Steps Should Minnesota Employers be Taking Now to be Compliant by January 1, 2024?
Before January 1, 2024, Minnesota employers, or employers with employees who work 80 hours or more in Minnesota per year, should consider taking the following steps:
- Review and analyze current paid time off policies and procedures to determine whether they will need to be updated and whether re-training will be required;
- Prepare to provide employees with certain written notices that will be required once the new law goes into effect, including, among other things, a written notice of employee rights and remedies under the new law (which must also be incorporated into any employee handbook maintained by the employer, if applicable);
- Determine how your company will measure the 12-month period and ensure that this is reflected in the company’s policies/guidelines surrounding paid sick and safe time;
- Ensure that there is a system in place to document (1) the total number of sick and safe time hours accrued and available for use, and (2) the total number of sick and safe time hours used during the pay period to comply with new record-keeping requirements of Minn. Stat. § 181.032.
Employers would be well-advised to consult with their employment counsel to assist with reviewing and/or developing the relevant notices, policies, and procedures. FMJ’s HR & Employment Law Practice Group is available to help review and analyze your company’s current policies, work through strategies for the future, and help train your staff on new policies related to sick and safe time. If you are interested in connecting with the team to discuss sick and safe time in Minnesota, or any other HR and Employment law matters, please contact Shannon McDonough, Natolie Hochhausen, or Jamie Briones.
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