Minnesota adopts paid sick and safe leave requirement 

September 27, 2023

Minnesota joins 17 other states and Washington, DC, in requiring accrued paid leave for employees. Starting Jan. 1, 2024, 2023 Ch. 53 (SF 3035, see Article 12) will require all employers in the state to provide up to 48 hours of earned sick and safe time (ESST) — accrued at one hour for every 30 hours worked — to eligible employees working in Minnesota. The law replaces the current statute that applies to an employer’s voluntary sick leave program. The state’s Department of Labor and Industry (DLI) is responsible for adopting rules, enforcing the law and providing a uniform employee notice.

Employers. The law applies to Minnesota employers of any size, including state and local government employers and nonprofit organizations. For situations involving a leasing company or professional employer organization, the responsible entity is the one paying employment-related taxes. For situations involving a temporary employee placed by a staffing agency, the staffing agency is the responsible entity, unless the underlying contract states otherwise.

Employees. Most Minnesota part-time, temporary and full-time employees are eligible, as long as they work at least 80 hours in a year for the same employer. An employee’s state of residence and an employer’s headquarters site are irrelevant. Covered employees do not include:

• Independent contractors
• Flight deck or cabin crew employees of an air carrier who spend 50% or fewer of their work hours in Minnesota in a calendar year and are provided paid leave equal to or greater than ESST requirements

Collective bargaining agreements (CBAs). The law does not apply to building and construction industry employees covered by a labor organization’s CBA with a valid ESST waiver. The law does not diminish the rights of union employees subject to a CBA meeting or exceeding ESST standards.

The law prohibits employers from requiring employees to find a replacement worker while on paid leave. An employee’s use of ESST cannot result in retaliation or any adverse action under an employer’s absence control policy or attendance point system. Other forms of retaliation are prohibited:

• Discharging, disciplining, penalizing,​ interfering with, threatening, restraining, coercing, or otherwise retaliating or discriminating against an individual for exercising ESST rights
• Reporting or threatening to report the actual or suspected citizenship or immigration status of an employee or a family member to a governmental authority because of the employee’s exercise of or attempt to exercise ESST rights

On return from leave, an employee will be entitled to return to the former position at the same preleave rate of pay, plus any automatic pay adjustments occurring during the leave. In addition, returning employees will retain all accrued preleave benefits and seniority. An agreement to work part-time during leave will not affect an employee’s return-to-work rights.

Benefit continuation. Employers will have to maintain all group insurance, group subscriber contracts and health plan coverage for the employee and dependents, as long as the employee continues paying active employee rates.

Four major cities in Minnesota (Bloomington, Duluth, Minneapolis and St. Paul) already have similar mandates in effect; the state ESST law does not preempt them. Starting Jan. 1, 2024, employers will have to follow the most protective legal requirements applicable to their employees. For example, Bloomington, Minneapolis, and St. Paul all match the state’s ESST law’s accrual and annual cap requirements. Duluth’s ordinance, however, has an accrual of one hour per 50 hours worked, with a cap of 64 hours per year. As a result, absent any changes to the local ordinance, Duluth employees will be entitled to accrue leave at the state rate of one hour per 30 hours worked, up to 64 hours per year.

In addition to providing paid leave and defining the year, employers will have to comply with earnings statement, posting and recordkeeping obligations.

Earnings statement. Minnesota employers already must include considerable information in employees’ earnings statements each pay period. Starting in 2024, earnings statements must include ESST hours accrued and available, as well as ESST hours used during the pay period.

Notice. By Jan. 1, 2024, or an employee’s hire date — whichever is later — employers will have to provide all employees a DLI-created uniform ESST notice, along with a copy of the employer’s written policy for providing notice of leave. The ESST notice will include leave amounts, the accrual year, terms of use, the ban on retaliation and complaint/civil action rights. Employers can meet the notice requirement by any of the following methods:

• Posting at each work location where the notice may be readily observed and easily reviewed
• Providing a paper or electronic copy to employees
• Displaying on a web-based or app-based platform through which employees perform work

Employers must also include the notice in an employee handbook, if applicable. Employers must provide the notice to employees in English and an employee’s self-identified primary language. DLI will provide the notice in the five most common languages spoken in Minnesota and perhaps other languages, if requested in writing by an employer. If DLI does not provide the notice in a requested language, the employer will not be subject to a notice penalty (see Enforcement and penalties below).

Recordkeeping. Employers will have to keep records of an employee’s hours worked and ESST taken for at least three years and comply with all of the recordkeeping requirements under the state’s Fair Labor Standards Act. Employers will have to make records available to DLI within 72 hours of a request and allow employees to inspect their records at a reasonable time and place. Any records or documents that contain health or medical information, pertain to domestic or sexual assault, or relate to ESST leave requested or taken must be kept confidential. Employers must destroy records more than three years old on an employee’s request.

Labor or service contracts. Employers will have a duty to ensure labor or service contractors comply with ESST requirements. An employer is held responsible for violations within the past two years if it has knowledge ​— based on normal facts and circumstances — of a contractor’s noncompliance. This duty extends to what would make a reasonably prudent person inquire about a contractor’s compliance.

DLI may issue a cease-and-desist order, require back pay, gratuities, compensatory damages, an equal amount as liquidated damages, and litigation and hearing costs. Repeated and willful violations will be subject to a civil penalty of up to $10,000 per violation. Recordkeeping violations will be subject to a penalty of up to $10,000 per failure. In addition, affected employees will have three years to bring a civil lawsuit to address alleged ESST violations and recover damages, costs, reasonable attorney’s fees, and injunctive and other equitable relief.

Employers already providing at least 48 hours of discretionary paid leave, vacation or paid time off (PTO) will not have to provide additional paid leave to comply with the law, as long as their policies adhere to ESST requirements. Employers should evaluate existing leave policies to determine any necessary changes, including employment termination, carryover and frontloading provisions.

Employers should look for upcoming DLI guidance, particularly on these issues:

• Pay rate for employees (especially salaried) on leave
• Coordination with local laws, as well as the state’s new paid family and medical leave (PFML) law

Benefits under the PFML law enacted earlier this year are scheduled to begin in 2026. Some absences may be covered under both laws, yet neither addresses benefit coordination. More information may come with implementing regulations. For more information on the state’s PFML law, see Minnesota passes paid family and medical leave law (July 10, 2023).

Multistate employers must also contend with implementing Illinois accrued paid leave requirements by Jan. 1, 2024. The Illinois law makes leave available for any reason. For details, see Illinois requires paid leave for any reason starting in 2024 (April 11, 2023). As mentioned above, some form of accrued paid leave is now required in about one-third of US states; see Roundup: State accrued paid leave mandates (April 29, 2022). Employers concerned about creating uniformity in benefits and administration nationwide may want to conduct a full review of accrued paid leave benefits across the workforce.

Finally, watch for paid sick leave developments in 2024. Other states are likely to revisit similar measures considered in the 2023 legislative sessions.

• Minnesota DLI
• ESST FAQs (DLI)
• ESST fact sheet (DLI, July 10, 2023)
• 2023 Ch. 53 (SF 3035, see Article 12) (Minnesota Legislature, May 24, 2023)
• MN Stat. § 181.9413 (effective through Dec. 31, 2023)

• Roundup of selected state health developments, second-quarter 2023 (Aug. 14, 2023)
• Minnesota passes paid family and medical leave law (July 10, 2023)
• Illinois requires paid leave for any reason starting in 2024 (April 11, 2023)
• Roundup: State accrued paid leave mandates (April 29, 2022)

• Life, absence and disability benefits