Minnesota Legislature Passes Significant Employee Leave Laws

By Daniel L. Blanchard & Tara K. Burke
May 26, 2023 - JacksonLewis

Minnesota is now the 12^th state to adopt a statewide program providing compensation to employees during family and medical leaves. It also joined the over 40 state and local jurisdictions mandating employer paid sick leave. Eligible Minnesota employees will be entitled to up to 48 hours of paid sick and safe leave and 20 weeks of family leave benefits. This patchwork of paid leave laws is further complicated in Minnesota where Minneapolis, St. Paul, Duluth, and Bloomington (July 1, 2023) all have paid sick leave laws already on the books. The new state-wide paid sick leave law does not preempt the local ordinances. Employers with employees in those cities will need to meet the most generous leave provisions and other protections of the applicable laws. New legislation also amends existing law requiring accommodations for pregnant and nursing employees.

FAMILY & MEDICAL LEAVE

Minnesota House Bill 2, signed by Governor Walz on May 25, 2023 will provide eligible employee with up to 12 weeks of family leave benefits and 12 weeks of medical leave benefits, subject to a 20-week annual limit. Eligible workers will be permitted to take family and medical leave and receive compensation through the new state family and medical benefit insurance program beginning January 1, 2026. The program will be funded through employer and employee contributions which also begin on January 1, 2026.

Covered Employers

The law applies to all private businesses (as well as state or local government sector employers and charter schools).

Employers may also apply for approval to meet their obligations under the ESST law through the substitution of a private plan that provides the same rights, protections, and benefits as the state-wide ESST law.

Who is Eligible for Paid Family Leave?

To be eligible, an individual must have earned at least 5.3 percent of the state average annual wage in total over the “base period” rounded down to the next lower $100 (currently $3,500 per year).

Seasonal workers who are employed for no more than 150 days and federal employees are not eligible. Self-employed individuals may opt-in to coverage.

Types of Paid Family Leave

A covered individual is eligible for family leave benefits if they take leave from work:

To address their own serious health condition, including pregnancy;
To care for a covered family member with a serious health condition;
To bond with a new child;
To address certain needs related to the domestic abuse, sexual assault, or stalking of the worker or the worker’s family member; and
To address certain needs arising from a family member’s military deployment.

Family member is defined broadly and includes among other things, a child, spouse, domestic partner, parent, sibling, grandchild, or grandparent and includes many relationships by marriage. Covered individuals will also be eligible for leave if they have been selected by an incapacitated person to be their caretaker.

Job and Benefits Protection

Employees who take leave are entitled to continued employee health benefits during leave and to reinstatement to an equivalent position unless the employer can show that the employee would not otherwise have been employed at the time reinstatement is requested.

Notice Requirements

Employers must post a notice prepared by the Department of Labor providing notice of available benefits and provide written notice to employees.

PAID SICK LEAVE

On May 24, 2023, Minnesota Governor Tim Walz signed an omnibus jobs and economic development bill which, among other things, creates statewide paid sick and safe leave entitlements for eligible employees and expands protections for pregnant and nursing employees.

Starting January 1, 2024, Minnesota employees will be entitled to receive up to 48 hours of earned sick and safe time (ESST) in a year.

The ESST law applies to all individuals or businesses with one or more employees.

Who is Eligible for ESST?

Any employee who performs work for at least 80 hours in a year in Minnesota will begin accruing ESST on January 1, 2024.

Independent contractors and certain individuals employed by air carriers as flight deck or cabin crew members are expressly excluded from the definition of “employee” and, therefore, are ineligible for ESST under the new law.

Accrual, Frontloading and Carryover

Under the ESST law, employees begin accruing ESST at the commencement of employment and will accrue a minimum of one hour of ESST for every 30 hours worked up to a maximum of 48 hours of ESST in a year.

Employees who are exempt from overtime requirements are deemed to work 40 hours in each workweek for purposes of accruing ESST, except that an employee whose normal workweek is less than 40 hours will accrue ESST based on the normal workweek.

Employees must be permitted to carry over accrued but unused paid sick leave benefits, but the total amount of accrued but unused ESST must not exceed 80 hours at any time, unless the employer agrees to a higher amount. Moreover, unless the employer maintains a policy that states otherwise, the ESST law does not require an employer to pay out an employee’s earned but unused ESST upon separation from employment.

Instead of allowing employees to accrue ESST, employer may adopt a frontloading approach whereby the employer provides an employee with a lump sum of ESST at the beginning of each year or the commencement of employment.Employers who use the frontloading approach are not required to allow employees to carry-over unused ESST at the end of the year. Under the frontloading approach, employers must provide employees with 48 hours of ESST if the employer pays employees for unused ESST at the end of the year. If the employer does not pay employees for unused ESST at the end of the year, then the employer must frontload 80 hours of ESST.

Use of ESST

An eligible employee may use ESST as soon as it accrues for any one of the following reasons:

To address an employee’s own: (i) mental or physical illness, injury, or other health condition; (ii) need for medical diagnosis, care, or treatment of a mental or physical illness, injury, or health condition; or (iii) need for preventive medical or health care;
To care for a family member: (i) with a mental or physical illness, injury, or other health condition; (ii) who needs medical diagnosis, care, or treatment of a mental or physical illness, injury, or health condition; or (iii) who needs preventive medical or health care;
For absences related to domestic abuse, sexual assault, or stalking of the employee or the
employee’s family member, provided the absence is to: (i) seek medical attention related to physical or psychological injury or disability caused by domestic abuse, sexual assault, or stalking; (ii) obtain services from a victim services organization; (iii) obtain psychological or other counseling; (iv) seek relocation or take steps to secure an existing home due to domestic abuse, sexual assault, or stalking; or (v) seek legal advice or take legal action, including preparing for or participating in any civil or criminal legal proceeding related to or resulting from domestic abuse, sexual assault, or stalking;
Time needed when the employee’s place of business closes due to weather or other public emergency or when an employee must care for a family member whose school or place of care has been closed due to weather or other public emergency;
When an employee cannot work or telework because the employee is: (i) prohibited from working by the employer due to health concerns related to the potential transmission of a communicable illness related to a public emergency; or (ii) seeking or awaiting the results of a diagnostic test for, or a medical diagnosis of, a communicable disease related to a public emergency and such employee has been exposed to a communicable disease or the employee’s employer has requested a test or diagnosis; and
When it has been determined by the health authorities having jurisdiction or by a
health care professional that the presence of the employee or family member of the employee in the community would jeopardize the health of others because of the exposure to a communicable disease, whether or not the individual has actually contracted the communicable disease.

The definition of “family member” is quite extensive and includes any individual “related by blood or whose close association with the employee is the equivalent of a family relationship.” Employees may also designate one individual annually who will be considered a “family member” for purposes of ESST.

Employers must allow employees to use ESST in the smallest increment of time tracked by the employer’s payroll system, so long as the increment is no more than four hours.

Reinstatement

Paid ESST benefits survive transfers, separations followed by a reinstatement within 180 days, and, in some circumstances, acquisitions by successor companies.

Employer Recordkeeping and Notification

The ESST law contains recordkeeping and notification requirements. Employers must maintain records documenting hours worked and ESST used by employees and make those records available to employees.

Employers must provide notice to employees of their rights to ESST, including the amount of ESST, the accrual year, and how ESST may be used by the employee. The notice must meet other specifications set forth in the law. The Department of Labor and Industry will publish a sample notice. Employers who intend to require employees to provide notice before using ESST, must also give employees a copy of a written policy with reasonable notice procedures. This information must also be included in an employee handbook if an employer maintains and distributes one to its employees.

At the end of each pay period, employers must include in employees’ earning statements both the total number of sick and safe time hours accrued and available for use as well as the total number of earned sick and safe time hours used during the pay period.

Job and Benefits Protection

Employees who take ESST are entitled to continued employee health benefits during leave and to reinstatement of employment at the same rate of pay the employee had been receiving when the ESST leave commenced, plus any automatic adjustments in the employee’s pay scale that occurred during the leave period.

PREGNANT AND LACTATING EMPLOYEES

The omnibus bill also includes amendments expanding existing statutory protections for pregnant and lactating employees which will take effect July 1, 2023 and apply to all employers with one or more employees.

Pregnant Employees

Employers must provide reasonable accommodations to employees experiencing health conditions related to pregnancy or childbirth unless the employer can demonstrate the accommodation would impose an undue hardship on the operation of the employer’s business. The employee and employer shall engage in an interactive process with respect to an employee’s request for a reasonable accommodation.

The new amendments did not change the law’s limits on the information employers can request from employees and the limits on undue hardship. An employer still may not require a pregnant employee to obtain the advice of a licensed health care provider or certified doula claim an undue hardship for the following accommodations: (1) more frequent or (now) longer restroom, food, and water breaks; (2) seating; and (3) limits on lifting over 20 pounds.

In addition, the bill added temporary leave of absence, modification in work schedule or job assignments, seating and more frequent or longer break periods to the potential reasonable accommodations listed in the law.

Lactating Employees

For lactating employees, employers must continue to provide reasonable break times each day to an employee who needs to express milk for any reason. The break times may (but no longer must) run concurrently with any break times already provided to the employee. The law also removed language (i) stating employers were not required to provide breaks if it would unduly disrupt the business and (ii) limiting the time period an employee can take these breaks to the 12 months following birth. Employers may not reduce an employee’s compensation for time used for the purpose of expressing milk.

Additionally, while employers must still make reasonable efforts to provide a room or other location that meets the statutory specification for employees to express milk, they must also now make reasonable efforts to provide a space that is “clean, private, and secure.” Employers are no longer permitted to deny

Notice Requirements

The bill also includes new notice requirements. Employers must now inform employees of their rights regarding pregnancy and lactation accommodation at the time of hire and also when an employee makes an inquiry about or requests parental leave. Employers must also include notice of employee rights and remedies in the employee handbook. The Commissioner of the Department of Labor & Industry will publish the required notice.

Covered employers should begin reviewing their policies to ensure compliance with the new leave and accommodation requirements. With regard to pregnancy and lactation accommodation, employers should also review their obligations under the new federal Pregnant Workers Fairness Act and Pump for Nursing Mothers Act.

These Minnesota laws are included in our leave law map database that provides subscribers with a detailed explanation of state and local leave laws around the country. The Leave and Accommodation Suite is developed and updated continually by our Disability, Leave & Health Management attorneys. Register here if you would like to learn about our Leave & Accommodation Suite.