🇺🇸 MINNESOTA STATE LAW – 2026 UPDATE

Minnesota Remote Work Laws 2026

⚠️Informational only — not legal or tax advice.

Last Updated: December 2025
Applicable Period: 2026 tax year and current employment regulations
Key Characteristic: Employers with remote workers physically located in Minnesota

Minnesota remote work laws and employment regulations guide

Table of Contents

Click any item below to jump to the relevant section

Overview

Minnesota is generally considered to have a worker-protective approach to employment regulation. According to official state sources, Minnesota has enacted numerous employment protections that exceed federal minimum standards in several areas.

General Characteristics (2025-2026):

According to the Minnesota Department of Labor and Industry and other official sources:

  • State minimum wage (2025): $11.13/hour for all employers
  • State minimum wage (2026): $11.41/hour effective January 1, 2026
  • Local minimum wages: Minneapolis ($15.97/hour in 2025, $16.37 in 2026); St. Paul (varies by employer size: $15.97 for large/macro businesses in 2025, $16.37 in 2026)
  • Paid sick leave: Required statewide under Earned Sick and Safe Time (ESST) law, effective January 1, 2024
  • State income tax: Progressive tax structure with rates ranging from 5.35% to 9.85% as of 2025
  • Meal/rest breaks: Not mandated by state law for adult employees
  • Overtime rules: Generally follows federal FLSA; Minnesota statutes provide some additional provisions
  • Workers’ compensation: Generally required for all employers who hire others to perform services

Source: Minnesota Department of Labor and Industry – https://www.dli.mn.gov/

⚠️ Note: These are general starting points only. Specific applicability depends on many factors including employer size, industry, employee classification, work location, and individual circumstances. Laws change frequently. Consult official sources and legal counsel for guidance on specific situations.

Comparison Context (For Reference Only):

Minnesota’s employment regulations are generally more extensive than neighboring states in several areas. For instance, Minnesota is one of the few states with mandatory paid sick leave statewide (ESST), while neighboring states like Wisconsin, Iowa, and the Dakotas do not have similar statewide requirements as of 2025. However, specific comparisons depend on the particular law area and should be verified with current official sources.

Source: Various state Department of Labor websites, December 2025

Official State Agency Information

The Minnesota Department of Labor and Industry (DLI) administers most employment laws in Minnesota. The Minnesota Department of Employment and Economic Development (DEED) handles unemployment insurance matters.

Minnesota Department of Labor and Industry (DLI)

Contact Information:

Areas of Oversight: According to the DLI website, the department oversees:

  • Wage and hour standards
  • Earned sick and safe time (ESST)
  • Workers’ compensation
  • Occupational safety and health
  • Construction codes and licensing
  • Apprenticeship programs

Minnesota Department of Employment and Economic Development (DEED)

Contact Information:

Areas of Oversight:

  • Unemployment insurance
  • Workforce development
  • Economic development programs

Minnesota Department of Revenue

Contact Information:

Areas of Oversight:

  • State income tax withholding
  • Worker classification for tax purposes
  • Employer tax obligations

⚠️ Note: These agencies can provide official interpretations of state law. However, for legal advice on how laws apply to your specific situation, consult a licensed attorney. For tax advice, consult a licensed tax professional.

Major State Employment Statutes

The following statutes are commonly cited in employment matters in Minnesota. This is general information only and does not constitute legal interpretation.

1. Minnesota Fair Labor Standards Act (Wage and Hour Law)

Statutory Citation: Minnesota Statutes Chapter 177
Official Source: https://www.revisor.mn.gov/statutes/cite/177

General Provisions (as stated in the statute):

According to Minnesota Statutes Chapter 177, the state’s wage and hour law generally addresses:

  • Minimum wage requirements (Minn. Stat. § 177.24)
  • Payment of wages (Minn. Stat. § 177.23)
  • Overtime compensation provisions
  • Employer record-keeping requirements
  • Penalties for violations

The statute generally requires that employers pay employees at least the applicable minimum wage for all hours worked and maintain certain wage records.

Application to Remote Work: According to general legal principles and Minnesota Department of Labor and Industry guidance, wage and hour requirements typically apply based on where work is physically performed. A worker performing work from a location in Minnesota would generally be subject to Minnesota wage and hour standards. However, specific applicability depends on multiple factors. Consult Minnesota DLI or legal counsel for guidance on particular circumstances.

Source: Minnesota Statutes Chapter 177; Minnesota DLI – https://www.dli.mn.gov/business/employment-practices/minimum-wage-minnesota

2. Earned Sick and Safe Time Law

Statutory Citation: Minnesota Statutes §§ 181.9445 – 181.9448
Effective Date: January 1, 2024
Official Source: https://www.revisor.mn.gov/statutes/cite/181.9445

General Overview:

According to the Minnesota Department of Labor and Industry, this law generally requires employers to provide earned sick and safe time (ESST) to employees who work in Minnesota.

Key Provisions (from statute and official guidance):

  • Employees accrue at least one hour of ESST for every 30 hours worked
  • Employees may accrue up to at least 48 hours per year
  • ESST may be used for employee’s or family member’s illness, injury, preventive care, and certain other purposes
  • Employers must pay ESST at the employee’s base rate of pay
  • Carryover and front-loading options are available

Coverage: According to Minnesota DLI guidance, the law generally applies to employees anticipated to work at least 80 hours per year for an employer in Minnesota. Part-time, seasonal, and temporary employees are generally covered. Independent contractors are not covered.

Note: Actual coverage and obligations depend on specific circumstances including local ordinances. The cities of Bloomington, Minneapolis, and St. Paul have their own ESST ordinances that may provide additional requirements. Employers should consult official agency guidance and legal counsel.

Source: Minnesota Department of Labor and Industry – https://www.dli.mn.gov/sick-leave

3. Workers’ Compensation Law

Statutory Citation: Minnesota Statutes Chapter 176
Official Source: https://www.revisor.mn.gov/statutes/cite/176

General Overview:

According to Minnesota Statutes Chapter 176, the Workers’ Compensation Law generally requires employers to provide workers’ compensation insurance or become self-insured.

General Requirements (as stated in law):

  • Employers are generally defined as those who hire others to perform services
  • Coverage is generally mandatory for all employers
  • Certain exemptions exist as specified in statute
  • Injuries must “arise out of and in the course of employment” to be compensable

Application to Remote Workers: Workers’ compensation coverage questions for remote workers involve fact-specific determinations about whether injuries occurred in the course of employment. These determinations are made by the Minnesota Department of Labor and Industry and Workers’ Compensation Court of Appeals based on complete factual circumstances.

Source: Minnesota Department of Labor and Industry – https://www.dli.mn.gov/business/workers-compensation

4. Minnesota Human Rights Act

Statutory Citation: Minnesota Statutes Chapter 363A
Official Source: https://www.revisor.mn.gov/statutes/cite/363A

General Overview:

The Minnesota Human Rights Act generally prohibits discrimination in employment based on protected characteristics.

Protected Categories (from statute): According to Minn. Stat. § 363A.08, protected categories generally include:

  • Race, color, creed, religion
  • National origin
  • Sex (including pregnancy, childbirth, and related medical conditions)
  • Marital status
  • Familial status
  • Sexual orientation
  • Gender identity
  • Age (if 18 years or older)
  • Disability
  • Public assistance status

Enforcement: The Minnesota Department of Human Rights investigates discrimination complaints.

Contact: Minnesota Department of Human Rights, 651-539-1100, https://mn.gov/mdhr/

Source: Minnesota Statutes Chapter 363A; Minnesota Department of Human Rights

5. Other Relevant Statutes

Minnesota Unemployment Insurance Law: Minnesota Statutes Chapter 268
Minnesota Parenting Leave Law: Minn. Stat. § 181.940 – 181.944
Minnesota Data Practices Act: Minnesota Statutes Chapter 13
Bone Marrow and Organ Donation Leave: Minn. Stat. § 181.945 – 181.947

Note: These statutes contain specific provisions that may apply to employment relationships. Consult the full text of each statute and official guidance for details.

Employee Classification Standards

Overview of Minnesota’s Classification Framework

Minnesota uses different tests for worker classification depending on the legal context. According to various Minnesota agencies and statutes, classification tests may differ for:

  • Unemployment insurance purposes – Handled by Minnesota Department of Employment and Economic Development (DEED)
  • Workers’ compensation purposes – Handled by Minnesota Department of Labor and Industry (DLI)
  • Tax withholding purposes – Handled by Minnesota Department of Revenue
  • Wage and hour purposes – Handled by Minnesota Department of Labor and Industry
  • Construction industry – Special 14-factor test effective March 1, 2025

This creates significant complexity because a worker could potentially be classified differently under different legal frameworks.

⚠️ Critical Point: Meeting the requirements for independent contractor status under one test does not guarantee the same classification under another test. Comprehensive analysis is required.

Source: Minnesota Department of Labor and Industry, Minnesota Department of Revenue, Minnesota DEED

Minnesota’s Tests for Classification

A. Unemployment Insurance Classification (ABC Test)

According to Minnesota Statutes § 268.035 and DEED guidance, Minnesota generally applies a form of the ABC test for unemployment insurance purposes.

Statutory Authority: Minn. Stat. § 268.035, subd. 12a
Official Guidance: https://www.uimn.org/employers/classification/index.jsp

General Framework:

Under Minnesota unemployment insurance law, an individual performing services is generally presumed to be an employee unless the hiring entity can establish all three of the following factors:

Factor A: Freedom from Control

General Description: According to official sources, this factor generally examines whether the individual is free from control and direction in performing the service, both under contract and in fact.

Considerations that may be relevant include:

  • Whether the hiring entity controls when, where, and how work is performed
  • Whether the individual can set their own schedule
  • Whether the individual uses their own methods to complete work
  • Whether supervision or evaluation is provided by the hiring entity
  • Whether the hiring entity requires attendance at meetings or training

⚠️ Important Note: These considerations are drawn from general principles discussed in official guidance. Actual application requires analysis of complete circumstances.

Factor B: Outside Usual Course of Business

General Description: According to official sources, this factor generally examines whether the service performed is outside the usual course of the hiring entity’s business or is performed outside of all places of business of the hiring entity.

Considerations that may be relevant include:

  • Whether the work is central to the hiring entity’s business operations
  • Whether the work is of a type the hiring entity regularly performs
  • Whether the work is performed at the hiring entity’s location
  • The nature of the hiring entity’s business
  • The nature of the services performed

Factor C: Independent Trade or Business

General Description: According to official sources, this factor generally examines whether the individual is customarily engaged in an independently established trade, occupation, profession, or business of the same nature as the service performed.

Considerations that may be relevant include:

  • Whether the individual has their own business license or registration
  • Whether the individual advertises services to the public
  • Whether the individual maintains a separate business location
  • Whether the individual has multiple clients
  • Whether the individual makes business investments (equipment, supplies, etc.)
  • Whether the individual carries business insurance

⚠️ CRITICAL: All three factors must be satisfied for independent contractor status under Minnesota’s unemployment insurance law. Failure to satisfy even one factor may result in employee classification for UI purposes.

Illustrative Scenarios (For General Understanding Only)

The following scenarios are provided for general educational purposes only. They do NOT constitute:

  • Classification determinations
  • Legal advice
  • Predictions of how actual cases would be decided
  • Recommendations for classification
  • Exhaustive analysis of relevant factors

Every situation is unique and requires professional evaluation.

Scenario Category: Remote IT Consultant

Example Situation: An individual provides IT consulting services to multiple companies from their home office. They maintain their own LLC, have business insurance, advertise their services on a website, use their own equipment, set their own hours, and are paid per project rather than hourly. They do not receive benefits from any client. One of their clients is a marketing agency in Minnesota.

General Observations: This scenario may share some characteristics commonly associated with independent contractor relationships under the ABC test, such as:

Factor A considerations:

  • The individual appears to set their own schedule and methods
  • Multiple clients may suggest freedom from control by any single entity
  • Use of own equipment may suggest independence

Factor B considerations:

  • If the hiring entity is a marketing agency and the individual provides IT services, this work may be outside the usual course of the marketing business
  • However, if IT services are regularly needed by the agency, this analysis becomes more complex

Factor C considerations:

  • Multiple clients, business license/LLC, business insurance, and public advertising may suggest an independently established trade
  • Regular marketing of services may suggest customary engagement in the trade

⚠️ HOWEVER: This is a simplified analysis. Actual classification would depend on numerous additional factors including:

  • The degree of actual control exercised by the hiring entity
  • Whether the work is truly outside the usual course or if IT services are integral to operations
  • The extent and nature of the independent business operation
  • Contractual terms
  • Other circumstances not described

This is NOT a determination. This scenario may or may not result in independent contractor classification depending on complete factual analysis by DEED.

Scenario Category: Remote Marketing Specialist

Example Situation: An individual works full-time from home for a single Minnesota-based marketing company. They follow a set schedule (9 AM – 5 PM), attend daily team meetings via video, use company-provided software and equipment, follow company processes and templates, and receive detailed feedback and direction from a supervisor. They are paid a regular salary and receive company benefits.

General Observations: This scenario may share many characteristics commonly associated with employee relationships under the ABC test:

Factor A considerations:

  • Set schedule established by company may suggest direction and control
  • Daily supervision and detailed feedback may indicate lack of independence
  • Following company processes may suggest behavioral control

Factor B considerations:

  • Marketing services for a marketing company are likely within the usual course of business
  • Work integral to company’s core services may fail Factor B

Factor C considerations:

  • Single client relationship may suggest lack of independent business
  • No evidence of separate business establishment, advertising, or other clients
  • Receiving company benefits may indicate traditional employment

⚠️ HOWEVER: This analysis is illustrative only. Complete evaluation would require examining:

  • Actual contract terms
  • Degree of day-to-day control
  • Financial arrangements
  • Duration and exclusivity of relationship
  • Other specific circumstances

This is NOT a determination. This scenario may or may not result in employee classification depending on official analysis.

⚠️ FINAL CRITICAL DISCLAIMER ON SCENARIOS:

The scenarios above are purely illustrative examples for general educational purposes. They do NOT constitute:

  • Legal advice or classification determinations
  • Predictions of how DEED would classify these relationships
  • Exhaustive analysis of all relevant factors
  • Guarantees of classification outcomes
  • Recommendations for structuring relationships

Every workers classification situation is unique and depends on complete factual circumstances. Classification determinations are made by DEED based on all relevant information.

For classification questions on specific situations:

  • Minnesota DEED: 651-296-6141 or 1-800-657-3858, www.uimn.org
  • Licensed employment attorney in Minnesota
  • Tax professional for tax implications

B. Workers’ Compensation Classification

For workers’ compensation purposes, Minnesota Department of Labor and Industry uses different tests depending on industry.

General Industries: According to Minnesota DLI, for most industries, classification generally focuses on five factors:

  1. The right to control the means and manner of performance
  2. The mode of payment
  3. The furnishing of tools and materials
  4. Control over the premises where work is done
  5. The right of discharge

Additionally, Minnesota Rules Chapter 5224 provides 34 different industry-specific tests.

Construction Industry: Effective March 1, 2025, a new 14-factor test applies specifically to construction workers.

⚠️ Complexity Note: Workers’ compensation classification is highly fact-specific and industry-dependent. The tests differ significantly from unemployment insurance classification.

Source: Minnesota Department of Labor and Industry; Minnesota Rules Chapter 5224

C. Tax Withholding Classification

According to the Minnesota Department of Revenue, for state tax withholding purposes, Minnesota generally follows federal IRS principles for classification.

General Framework: The Minnesota Department of Revenue considers three broad categories:

  1. Behavioral Control: Does the business have the right to direct or control how work is done?
  2. Financial Control: Does the business have the right to direct or control financial aspects of the worker’s job?
  3. Relationship of the Parties: How do the parties perceive their relationship?

Source: Minnesota Department of Revenue – https://www.revenue.state.mn.us/classifying-worker

Federal IRS Determination: Employers or workers can request an IRS determination by filing federal Form SS-8. According to Minnesota DOR, Minnesota will abide by the IRS’s decision.

D. Construction Industry 14-Factor Test (Effective March 1, 2025)

⚠️ EXTREMELY COMPLEX AND HIGH-RISK AREA FOR CONSTRUCTION EMPLOYERS:

Worker classification in Minnesota’s construction industry is subject to a new 14-factor test effective March 1, 2025. This test replaced the previous 9-factor test and imposes significantly more stringent requirements. The information below is general background only and does NOT constitute classification analysis or legal advice.

CRITICAL WARNING: Construction industry misclassification carries severe penalties including up to $10,000 per violation, individual liability for owners/officers, upstream contractor liability, and stop work orders. Construction employers should consult with legal counsel immediately to review classification practices.

Legal Framework

Statutory Authority: Minnesota Statutes § 181.723, subdivisions 3 and 4
Effective Date: March 1, 2025
Official Source: https://www.revisor.mn.gov/statutes/cite/181.723

According to the statute, an individual who provides or performs commercial or residential building construction or improvement services is presumed to be an employee unless ALL 14 factors are satisfied.

⚠️ Note: This is a presumption-of-employment test. The burden is on the hiring entity to establish that all 14 factors are met. Failure to satisfy even ONE factor may result in employee classification.

Source: Minnesota Department of Labor and Industry – https://www.dli.mn.gov/misclassification-construction

The 14 Factors (As Stated in Statute)

According to Minnesota Statutes § 181.723, subd. 4, an individual is an independent contractor (not an employee) in the construction industry ONLY if the individual operates through a business entity that meets ALL of the following 14 requirements:

Factor 1: Separate Business Establishment

Statutory Language (paraphrased): The business entity was established and maintained separately from and independently of the person for whom services were provided or performed.

General Considerations: According to official guidance, this factor may examine whether the business entity has:

  • Its own business identity separate from the hiring entity
  • Independent business operations
  • Separate business records and accounts
  • Independent business decision-making

Factor 2: Equipment, Tools, and Facilities

Statutory Language (paraphrased): The business entity owns, rents, or leases equipment, tools, vehicles, materials, supplies, office space, or other facilities used to provide or perform building construction or improvement services.

General Considerations: This factor may examine:

  • Whether the business entity furnishes its own equipment and tools
  • Whether equipment is owned, rented, or leased by the business entity
  • The extent of equipment and tool ownership
  • Whether work vehicles are owned/leased by the business entity

Factor 3: Similar Services to Others

Statutory Language (paraphrased): The business entity provides or performs, or offers to provide or perform, the same or similar building construction or improvement services to other persons.

General Considerations: This factor may examine:

  • Whether the business entity actively seeks work from multiple clients
  • Whether the business entity actually performs work for other clients
  • Marketing and advertising to the general public
  • Maintenance of a client list beyond the single hiring entity

Factor 4: Federal Employer Identification Number

Statutory Language (paraphrased): The business entity holds or has applied for a federal employer identification number with the IRS or, if the business entity is a sole proprietorship, the business entity has filed business or self-employment income tax returns with the federal IRS based on the services provided or performed in the previous year or, for a new business entity, in a timely manner based on the current year’s services.

General Considerations: This factor requires documented tax status:

  • Federal EIN for entities
  • OR business/self-employment tax returns for sole proprietorships
  • Documentation must be current and reflect the services provided

Factor 5: 1099 Forms and W-9 Compliance

Statutory Language (paraphrased): The business entity has received 1099 tax forms or can demonstrate receiving similar forms documenting previous contract work for building construction or improvement services and has completed and provided a W-9 tax form to the person for whom the services are being provided or performed.

General Considerations: This factor requires:

  • History of receiving 1099 forms for construction services
  • OR other documentation of previous contract work
  • Provision of W-9 to current hiring entity

⚠️ Important: The statute does not fully clarify what documentation satisfies “receiving similar forms” for demonstrating previous contract work.

Factor 6: Written Contracts

Statutory Language (paraphrased): The business entity operates under a contract or written proposal to provide or perform building construction or improvement services for a specific amount of money or specific rate of pay.

General Considerations: This factor requires:

  • Written agreement (contract or proposal)
  • Specific compensation amount or rate
  • Services must be specified

Note: Change orders appear to have different documentation requirements under the statute.

Factor 7: Incurs Main Expenses

Statutory Language (paraphrased): The business entity incurs the main expenses and costs related to providing or performing the services under the written proposal or contract.

General Considerations: This factor may examine:

  • Which party pays for materials, supplies, equipment
  • Which party bears cost of repairs or corrections
  • Financial risk borne by the business entity
  • Extent of expenses relative to compensation

Factor 8: Responsible for Completion

Statutory Language (paraphrased): The business entity is responsible for the satisfactory completion of the services to be provided or performed under the written proposal or contract and is liable for a failure to satisfactorily complete the services.

General Considerations: This factor may examine:

  • Contractual responsibility for completion
  • Financial consequences for non-completion
  • Warranty or guarantee obligations
  • Risk of loss for unsatisfactory work

Factor 9: Services in Business Entity Name

Statutory Language (paraphrased): The business entity provides or performs services under the business entity’s name, using the business entity’s phone number, and with the business entity listed as the service provider or contact.

General Considerations: This factor examines business identification:

  • Services billed in business entity’s name
  • Business entity’s phone number used
  • Business entity identified as service provider
  • Public-facing business identity

Factor 10: Payment in Business Entity Name

Statutory Language (paraphrased): The business entity submits invoices and receives payments for completion of the specific services provided or performed under the written proposal, contract, or change order in the name of the business entity. Payments made in cash do not meet this requirement.

General Considerations: This factor requires:

  • Invoices issued in business entity’s name
  • Payments made to business entity (not individual)
  • Cash payments do NOT satisfy this factor
  • Payment documentation under business entity name

⚠️ Critical: This factor explicitly excludes cash payments. Contractors paying subcontractors in cash may face classification issues.

Factor 11: Control Over Means of Performance

Statutory Language (paraphrased): The terms of the written proposal, contract, or change order provide the business entity control over the means of providing or performing the specific services, and the business entity in fact controls the provision or performance of the specific services.

General Considerations: This factor has two components:

  • Contractual control (in the written agreement)
  • Actual control (in fact)

Both must be present. This may examine:

  • Who determines methods and procedures
  • Who controls scheduling and sequencing
  • Degree of supervision or direction
  • Decision-making authority over work performance

Factor 12: Business Entity Incurs Main Expenses

Statutory Language (paraphrased): The business entity incurs the main expenses and costs related to providing or performing the specific services under the written proposal, contract, or change order.

General Considerations: This appears similar to Factor 7 but may apply specifically to the particular contract/proposal rather than general business operations.

Factor 13: Responsible for Completion and Failure

Statutory Language (paraphrased): The business entity is responsible for the completion of the specific services to be provided or performed under the written proposal, contract, or change order and is responsible, as provided under the written proposal, contract, or change order, for failure to complete the specific services.

General Considerations: Similar to Factor 8 but may be more specific to the particular project/contract:

  • Project-specific completion responsibility
  • Consequences specified in the agreement
  • Contractual liability for non-completion

Factor 14: Required Registration, License, or Certification

Statutory Language (paraphrased): The business entity holds or has applied for any required federal, state, or local registration, license, or certification to provide or perform the services.

General Considerations: This factor requires:

  • All required registrations for the services
  • All required licenses for the services
  • All required certifications for the services
  • Applications for same if not yet received

⚠️ CRITICAL TIMING ISSUE: According to legal analyses, this factor focuses on “the time at which services were provided.” Inadvertent lapses in licensure or registration during service performance could lead to misclassification findings even if properly licensed at contract signing.

Source: Minnesota Statutes § 181.723; Minnesota Department of Labor and Industry guidance

Additional Critical Considerations

Upstream Contractor Liability:

According to Minn. Stat. § 181.723, if a subcontractor fails to meet all 14 factors, the individuals performing work for that subcontractor may be deemed employees of the upstream contractor. This creates potential cascading liability up the contracting chain.

What this may mean: A general contractor could be held liable for misclassification by a subcontractor or even a sub-subcontractor if those downstream contractors do not satisfy all 14 factors.

Individual Liability:

According to the statute, owners, officers, or agents of a business who knowingly or repeatedly engage in misclassification may be held individually liable.

Stop Work Orders:

Effective March 1, 2025, the Minnesota Department of Labor and Industry has authority to issue stop work orders for construction sites where misclassification violations are found.

Penalties:

According to Minn. Stat. § 181.723:

  • Up to $10,000 per individual misclassified
  • Compensatory damages (back pay, benefits, employer contributions)
  • Up to $1,000 per day for failure to cooperate with investigations
  • Potential individual liability for owners/officers

Source: Minnesota Statutes § 181.723; Minnesota Department of Labor and Industry

Record-Keeping Requirements

According to the statute, persons in the construction industry must keep documents and information regarding independent contractor status determinations for at least three years.

⚠️ Best Practice: Construction contractors should consult legal counsel to:

  • Review all subcontractor relationships
  • Ensure written contracts satisfy all 14 factors
  • Verify licenses and registrations remain current throughout project
  • Document basis for classification decisions
  • Implement monitoring systems for ongoing compliance

Minimum Wage Information for Minnesota

Current Rate Information (As Published by Minnesota DLI)

According to the Minnesota Department of Labor and Industry, Minnesota’s minimum wage is indexed annually for inflation under Minn. Stat. § 177.24.

State Minimum Wage Rates:

Effective Date Rate (All Employers) Training Wage (Under 20, First 90 Days) Source
January 1, 2025 $11.13/hour $9.08/hour Minnesota DLI
January 1, 2026 $11.41/hour $9.31/hour Minnesota DLI

Key Changes from Prior Law:

According to information from Minnesota DLI, the 2024 legislative session eliminated the distinction between “large employers” and “small employers” for minimum wage purposes. As of January 1, 2025, all employers in Minnesota must pay at least the same minimum wage regardless of annual gross revenues.

Youth Wage: As of 2025, the separate youth minimum wage (for workers under 18) has been eliminated. Workers under 18 are generally entitled to the same minimum wage as adults, subject to the 90-day training wage for workers under 20.

Training Wage: According to Minnesota law, employers may pay a training wage of $9.08/hour (2025) or $9.31/hour (2026) to employees under 20 years of age for the first 90 consecutive days of employment.

⚠️ Important: The training wage is limited to the first 90 consecutive calendar days, not working days.

No Tip Credit: Minnesota does not allow employers to take a “tip credit” against the minimum wage. According to Minnesota DLI, employees must be paid at least the full minimum wage per hour, regardless of tips received.

Source: Minnesota Department of Labor and Industry – https://www.dli.mn.gov/minwage

Local Minimum Wages

According to official city sources, Minneapolis and St. Paul have enacted local minimum wage ordinances that require higher rates than the state minimum wage.

Minneapolis Minimum Wage

According to the City of Minneapolis, the city’s minimum wage applies to work performed within the geographic boundaries of Minneapolis.

Rates:

Effective Date Rate Notes
January 1, 2025 $15.97/hour All employers
January 1, 2026 $16.37/hour All employers

Key Provisions (from city ordinance):

  • The Minneapolis minimum wage applies to all employers regardless of size as of 2025
  • Applies to work performed in Minneapolis (not employer location)
  • Indexed annually for inflation
  • Tips cannot be counted toward minimum wage
  • Immigration status does not affect coverage

Official Information: https://minimumwage.minneapolismn.gov/

Source: City of Minneapolis, December 2025

St. Paul Minimum Wage

According to the City of St. Paul (St. Paul City Ordinance Chapter 224), St. Paul’s minimum wage varies by employer size.

Rates by Employer Size:

Effective January 1, 2025:

Employer Category Rate Definition
Macro businesses $15.97/hour 10,000+ employees
Large businesses $15.97/hour 101+ employees
Small businesses $15.00/hour 6–100 employees
Micro businesses $13.25/hour 5 or fewer employees

Effective January 1, 2026:

Employer Category Rate Definition
Macro businesses $16.37/hour 10,000+ employees
Large businesses $16.37/hour 101+ employees
Small businesses TBD* 6–100 employees
Micro businesses TBD* 5 or fewer employees

*According to the city, smaller employer rates increase on July 1, 2026. Verify with city sources.

Effective July 1, 2026:

  • Small businesses: Verify with St. Paul for updated rate
  • The city is phasing in a single minimum wage of $15.00 (then indexed) by 2027-2028

Key Provisions (from city ordinance):

  • Applies to work performed in St. Paul
  • Employer size based on total employees (not just St. Paul employees)
  • Indexed annually for inflation after reaching $15.00
  • Tips and benefits do not count toward minimum wage
  • Immigration status does not affect coverage
  • Youth employees (14-17) may be paid 85% of small employer rate for first 90 days

Official Information: https://www.stpaul.gov/departments/human-rights-equal-economic-opportunity/labor-standards-enforcement-and-education/minimum-wage

Source: City of St. Paul, December 2025

Application to Remote Workers

General Principle:

According to general legal principles and Minnesota Department of Labor and Industry guidance, minimum wage requirements typically apply based on where work is physically performed, not where the employer is located.

What this generally means:

  • A worker performing work from a location in Minneapolis would generally be subject to Minneapolis minimum wage ($15.97 in 2025)
  • A worker performing work from a location in St. Paul would generally be subject to St. Paul minimum wage (varies by employer size)
  • A worker performing work from elsewhere in Minnesota would generally be subject to state minimum wage ($11.13 in 2025)
  • Employer’s business location is generally not the determining factor

⚠️ Important: Specific situations may be complex, especially for workers who perform work in multiple locations. Employers should:

  • Track where remote workers physically perform work
  • Apply the highest applicable minimum wage when work is performed in multiple jurisdictions
  • Consult Minnesota DLI or legal counsel for complex situations

For Remote Workers Outside Minnesota:

If a Minnesota-based employer has workers performing services entirely outside Minnesota, different states’ laws may apply. This involves complex choice-of-law questions that require legal analysis.

Source: General legal principles; Minnesota DLI guidance

Calculating Minimum Wage Compliance

According to Minnesota law, minimum wage is calculated based on all hours worked, regardless of how employees are paid (hourly, salary, commission, piece rate, etc.).

Key Points:

  • All hours worked must be compensated at least at minimum wage
  • For salaried employees, divide salary by hours worked to determine if minimum wage is met
  • For commissioned employees, total compensation must equal at least minimum wage for all hours worked
  • Deductions cannot reduce pay below minimum wage (with limited statutory exceptions)

Source: Minnesota Department of Labor and Industry

Resources for Current Information

Overtime and Break Requirements

A. Overtime Standards

Minnesota has both state and federal overtime requirements. Which law applies depends on the employer and employee characteristics.

Federal Overtime (Fair Labor Standards Act)

Statutory Authority: 29 U.S.C. § 207 (FLSA)
Official Source: https://www.dol.gov/agencies/whd/flsa

General Framework:

According to the federal Fair Labor Standards Act, covered employers must pay overtime at 1.5 times the regular rate for all hours worked over 40 in a workweek.

Coverage: According to U.S. Department of Labor guidance, FLSA generally covers:

  • Employers with annual gross sales of $500,000 or more
  • Employers engaged in interstate commerce
  • Specific industries: hospitals, nursing homes, schools, government agencies

Most employers and employees in Minnesota are covered by federal FLSA.

Minnesota State Overtime

Statutory Authority: Minnesota Statutes § 177.25
Official Source: https://www.revisor.mn.gov/statutes/cite/177.25

General Framework:

According to Minnesota Statutes § 177.25, Minnesota law requires overtime payment at 1.5 times the regular rate for hours worked over 48 in a workweek.

Coverage: Minnesota’s overtime law applies to employers and employees NOT covered by the federal FLSA.

⚠️ Important Distinction: The key difference is the overtime threshold:

  • Federal FLSA: Overtime after 40 hours per week
  • Minnesota law: Overtime after 48 hours per week (for non-FLSA covered employees)

Which Law Applies:

According to Minnesota Department of Labor and Industry guidance:

  • If an employer or employee is covered by FLSA → federal 40-hour rule applies
  • If NOT covered by FLSA → Minnesota 48-hour rule applies
  • When both apply, the law more favorable to the employee governs (federal 40-hour rule)

Practical Reality: Because FLSA coverage is broad, most Minnesota employers must follow the federal 40-hour overtime rule. The 48-hour rule applies primarily to small employers not engaged in interstate commerce.

Source: Minnesota Department of Labor and Industry – https://www.dli.mn.gov/business/employment-practices/overtime-laws

No Daily Overtime

⚠️ Important: Unlike some states (e.g., California), Minnesota does not require overtime for hours worked beyond a certain number in a single day. Overtime is calculated on a workweek basis only.

What this means:

  • An employee working 12 hours in one day but only 40 hours for the week is not entitled to overtime in Minnesota (under state law)
  • Overtime calculations are based on total hours in the 7-day workweek

Source: Minnesota Department of Labor and Industry

Calculating Overtime Rate

Regular Rate of Pay:

According to federal and Minnesota law, the “regular rate” for overtime calculation purposes includes:

  • Base hourly wage
  • Non-discretionary bonuses
  • Commissions
  • Shift differentials
  • Certain other compensation

Excluded from regular rate:

  • Discretionary bonuses
  • Gifts
  • Vacation, holiday, and sick pay
  • Expense reimbursements

Formula:

Regular Rate = Total compensation in workweek ÷ Total hours worked in workweek
Overtime Rate = Regular Rate × 1.5

Example (for illustration only):

An employee works 50 hours in a week and earns $900 in total compensation (including a commission).

Regular Rate = $900 ÷ 50 hours = $18/hour
Overtime Rate = $18 × 1.5 = $27/hour

Compensation for the week:

  • 40 hours at regular rate: 40 × $18 = $720
  • 10 overtime hours at overtime rate: 10 × $27 = $270
  • Total: $990

(Note: There are alternative calculation methods. This is a simplified example. Actual calculations may differ.)

For Salaried Employees:

Non-exempt salaried employees are entitled to overtime. The regular rate is calculated by dividing the salary by the number of hours the salary is intended to compensate.

Source: Minnesota Department of Labor and Industry; U.S. Department of Labor

Application to Remote Workers

Overtime regulations generally apply to remote workers performing non-exempt work in the same manner as on-site workers. The key factor is exemption status, not work location.

Challenges for Remote Work:

According to general principles, determining compensable time for remote workers can involve additional considerations:

  • After-hours email and message responses
  • Time spent in virtual meetings outside regular hours
  • On-call time worked from home
  • Time spent setting up or maintaining home office technology for work

⚠️ Complex Issue: Employers may wish to establish clear policies regarding:

  • Expectations for after-hours availability
  • Procedures for reporting all hours worked
  • Systems for tracking remote worker time
  • Authorization requirements for overtime work

Consult wage-hour counsel for guidance on remote worker time tracking and compensation.

Source: General wage-hour principles; U.S. Department of Labor guidance

Overtime Exemptions

Both federal and Minnesota law provide exemptions from overtime requirements for certain categories of employees. Common exemptions include:

Executive, Administrative, and Professional (EAP) Exemptions:

To potentially qualify for exemption, employees generally must meet tests related to:

  1. Salary Basis: Paid a predetermined salary not subject to reduction based on quality or quantity of work
  2. Salary Level: Meets minimum salary threshold
  3. Duties: Performs exempt-level duties as defined by law

2026 Federal Salary Threshold (as of January 2025):

According to current federal regulations, the minimum salary for EAP exemptions under federal law is:

  • $844 per week ($43,888 annually)

Note: Federal salary thresholds have been subject to recent litigation and regulatory changes. Verify current requirements.

Minnesota Exemptions:

Minnesota Statutes § 177.23, subd. 7 provides exemptions that are similar but not identical to federal exemptions.

⚠️ Critical: Minnesota law includes specific provisions, such as:

  • Outside sales exemption requires at least 80% of sales be conducted away from employer’s place of business (different from federal)
  • Executive and administrative exemptions have specific state law definitions

Computer Professional Exemption:

May be paid hourly or salary. According to federal law, computer professionals may be exempt if paid:

  • At least $844/week on a salary basis, OR
  • At least $27.63/hour (verify current rate)

Plus must meet duties test.

Other Common Exemptions:

  • Outside sales employees
  • Certain agricultural workers
  • Certain seasonal employees
  • Certain transportation workers
  • Others as specified in statute

⚠️ Important Warning: Exemption determinations are highly fact-specific and technical. Misclassification of employees as exempt can result in significant back pay liability.

Job title alone does not determine exemption status. All three tests (salary basis, salary level, duties) must be satisfied.

For exemption analysis:

Source: 29 C.F.R. § 541; Minnesota Statutes § 177.23

B. Meal and Rest Break Requirements

⚠️ IMPORTANT UPDATE: Minnesota enacted significant changes to meal and rest break requirements effective January 1, 2026. The information below reflects both current (2025) and new (2026) requirements.

Current Requirements (Through December 31, 2025)

Meal Breaks (Current Law):

Statutory Authority: Minn. Stat. § 177.254
Official Source: https://www.revisor.mn.gov/statutes/cite/177.254

According to current Minnesota law, employers must provide employees working eight or more consecutive hours with “sufficient time to eat a meal.”

Key Provisions:

  • Applies to employees working 8+ consecutive hours
  • “Sufficient time” is not specifically defined in statute
  • Minnesota regulations indicate 30 minutes is ordinarily sufficient
  • May be unpaid if employee is completely relieved of duties

Rest Breaks (Current Law):

Statutory Authority: Minn. Stat. § 177.253
Official Source: https://www.revisor.mn.gov/statutes/cite/177.253

According to current law, employers must provide employees with “adequate time to use the nearest convenient restroom” within each four consecutive hours of work.

Key Provisions:

  • Must be provided every four consecutive hours
  • “Adequate time” is not specifically defined
  • Generally must be paid time

Source: Minnesota Statutes §§ 177.253, 177.254; Minnesota Rules 5200.0120

New Requirements (Effective January 1, 2026)

⚠️ CRITICAL CHANGES: Significant amendments to Minnesota’s meal and rest break laws take effect January 1, 2026.

New Rest Break Requirements (Effective 1/1/2026):

Statutory Authority: Minn. Stat. § 177.253 (as amended)

According to the amended statute, employers must “allow each employee a rest break of at least 15 minutes or enough time to utilize the nearest convenient restroom, whichever is longer, within each four consecutive hours of work.”

Key Changes:

  • Minimum 15 minutes (new baseline – increased from undefined “adequate time”)
  • OR sufficient time to use restroom if longer than 15 minutes
  • Within each four consecutive hours of work
  • Must be paid time

Practical Impact:

  • Employers who previously provided shorter rest breaks (e.g., 10 minutes) must increase to minimum 15 minutes
  • If restroom access requires more than 15 minutes, longer break must be allowed
  • Frequency: At least one 15-minute break per four-hour period

Source: Minn. Stat. § 177.253 (effective January 1, 2026)

New Meal Break Requirements (Effective 1/1/2026):

Statutory Authority: Minn. Stat. § 177.254 (as amended)

According to the amended statute, employers must “allow each employee who is working for six or more consecutive hours a meal break of at least 30 minutes.”

Key Changes:

  • Threshold reduced from 8 hours to 6 hours of consecutive work
  • Minimum 30 minutes specified (previously undefined “sufficient time”)
  • May be unpaid if employee is completely relieved of duties
  • One meal break per shift regardless of length (per Minnesota DLI guidance)

Minnesota DLI Guidance on New Requirements:

According to guidance published by Minnesota DLI in 2025:

  • The 30-minute meal break requirement applies once per shift, even for shifts of 12+ hours
  • Employees may voluntarily waive breaks (best practice to document in writing)
  • Whether an employer “allows” breaks is fact-dependent, considering policies, communication, and actual work circumstances

Source: Minn. Stat. § 177.254 (effective January 1, 2026); Minnesota DLI FAQs

Penalties for Break Violations (New)

New Enforcement Mechanism (Effective 1/1/2026):

According to the amended statutes, if an employer does not allow the required rest break or meal break, the employer is liable to the employee for:

  • Payment for the break time that should have been allowed at the employee’s regular rate of pay
  • PLUS an equal amount as liquidated damages

What this means:

  • If a required 15-minute rest break is not allowed, employer may owe 15 minutes of pay + 15 minutes as liquidated damages (30 minutes total)
  • If a required 30-minute meal break is not allowed, employer may owe 30 minutes of pay + 30 minutes as liquidated damages (60 minutes total)

⚠️ Significant Financial Impact: These automatic liquidated damages can result in substantial liability for break violations.

Source: Minn. Stat. §§ 177.253, 177.254 (effective January 1, 2026)

Exemptions from Break Requirements

According to Minnesota law, meal and rest break requirements do not apply to:

  • Employees in bona fide executive, administrative, or professional capacities (as defined by Minnesota FLSA)
  • Certain agricultural workers
  • Certain seasonal employees
  • Individuals with DOT qualifications (certain drivers)
  • Positions covered by collective bargaining agreements that address breaks

Source: Minn. Stat. §§ 177.253, 177.254; Minnesota DLI guidance

Application to Remote Workers

Meal and rest break requirements generally apply to remote workers performing non-exempt work in the same manner as on-site workers.

Challenges for Remote Work:

Compliance with break requirements for remote workers may present practical challenges:

  • Verifying that breaks are actually taken
  • Ensuring workers do not perform duties during unpaid meal periods
  • Documenting break compliance
  • Handling interruptions during breaks (e.g., emergency calls)

⚠️ Best Practices: Employers may consider:

  • Clear written policies regarding break entitlements and expectations
  • Systems for remote workers to document breaks taken
  • Training for managers on break requirements
  • Regular reminders to remote workers about break rights
  • Procedures for requesting and documenting break waivers (if allowed)

Consult employment counsel for remote work break compliance strategies.

Breast Milk Expression Breaks

Federal Requirement:

Under the federal Fair Labor Standards Act (as amended), employers must provide:

  • Reasonable break time for expressing breast milk
  • A private location (not a bathroom) for expressing milk
  • For one year after the child’s birth

Minnesota Requirement:

Minnesota law (Minn. Stat. § 181.939) provides additional protections:

  • Applies to employers with 15+ employees
  • Reasonable break time for 12 months following birth
  • May not reduce employee’s pay for time spent expressing milk

Source: 29 U.S.C. § 207(r); Minn. Stat. § 181.939

Earned Sick and Safe Time (ESST)

Legal Framework

Statutory Authority: Minnesota Statutes §§ 181.9445 – 181.9448
Effective Date: January 1, 2024
Amendments: 2025 amendments effective January 1, 2025
Official Source: https://www.revisor.mn.gov/statutes/cite/181.9445

According to the Minnesota Department of Labor and Industry, the Earned Sick and Safe Time (ESST) law requires employers to provide paid leave that employees may use for certain specified purposes including illness, injury, preventive care, and safety-related needs.

Source: Minnesota Department of Labor and Industry – https://www.dli.mn.gov/sick-leave

Coverage and Eligibility

Employer Coverage

According to Minnesota Statutes § 181.9446, the ESST law generally applies to employers in Minnesota.

General Rule: According to Minnesota DLI, virtually all employers with employees working in Minnesota are covered, regardless of employer size or annual revenues.

Who Must Comply:

  • Private employers
  • Public employers
  • Nonprofit organizations
  • Staffing agencies (generally responsible for their placed workers)

⚠️ Note: There are limited exceptions. Certain positions may be exempt as specified in statute.

Employee Eligibility

According to Minn. Stat. § 181.9445, subd. 4, an employee is generally eligible for ESST if the employee:

  • Is anticipated to work at least 80 hours in a year for an employer in Minnesota; AND
  • Is not an independent contractor

Who is Covered:

  • Full-time employees
  • Part-time employees
  • Seasonal employees
  • Temporary employees
  • Employees who work remotely from Minnesota

⚠️ Important: According to the 2025 amendments, employees anticipated to work at least 80 hours per year are covered. The 80-hour threshold is an annual anticipation, not a requirement to have already worked 80 hours.

Exemptions:

According to the statute and Minnesota DLI guidance, the following are generally NOT covered by ESST:

  • Independent contractors
  • Certain volunteer or paid on-call firefighters
  • Certain volunteer ambulance attendants
  • Certain paid-on-call ambulance service personnel
  • Elected officials (effective January 1, 2025)
  • Certain executive policymaking positions (effective January 1, 2025)
  • Members of boards or commissions (effective January 1, 2025)

Source: Minnesota Statutes §§ 181.9445-181.9448; Minnesota DLI – https://www.dli.mn.gov/sick-leave-FAQs

Accrual Requirements

According to Minn. Stat. § 181.9446, employees accrue ESST as follows:

Accrual Rate:

  • Employees accrue at least one (1) hour of ESST for every 30 hours worked
  • Accrual begins on the first day of employment
  • Employees may use ESST as it accrues

Annual Cap:

  • Employers must allow employees to accrue at least 48 hours of ESST per year
  • Employers may voluntarily agree to a higher maximum

Carryover:

  • According to the statute, unused ESST generally carries over to the following year
  • However, employers may limit the total amount available for use (see below)

Caps on Usage:

  • Employers may limit use to 48 hours per year
  • Even if more has accrued and carried over, employers may cap annual usage at 48 hours (unless employer agrees to more)

Example (For Illustration Only):

An employee who works 40 hours per week would generally accrue:

  • 40 hours worked ÷ 30 = approximately 1.33 hours of ESST per week
  • Over 52 weeks: approximately 69 hours accrued

However, if the employer has implemented the statutory minimum:

  • Maximum accrual: At least 48 hours per year must be allowed
  • Maximum usage: Employer may limit use to 48 hours per year
  • Carryover: Unused hours carry over, but total available for use may be capped

⚠️ Note: This is a simplified example. Actual accrual depends on hours actually worked, employer policies, and other factors.

Source: Minn. Stat. § 181.9446; Minnesota DLI

Front-Loading Options

According to Minnesota law, employers may choose to “front-load” ESST rather than using the accrual method.

Front-Loading Defined: Providing the full amount of ESST at the beginning of the year rather than requiring employees to accrue it over time.

Options:

Option 1: Front-load 48 hours at start of year with no carryover requirement (employee use-it-or-lose-it annually)

Option 2: Front-load 80 hours at start of year with no carryover requirement and no payout at end of year

Option 3: Other arrangements that meet or exceed statutory minimum requirements

⚠️ Important: Employers using front-loading must still comply with all other ESST requirements including permissible uses, notice requirements, and prohibition on retaliation.

Source: Minnesota DLI guidance; Minn. Stat. § 181.9446

Permitted Uses of ESST

According to Minn. Stat. § 181.9445, subd. 2, employees may use earned sick and safe time for the following purposes:

Sick Time Uses

Employee’s Own Health:

  • Mental or physical illness, injury, or health condition
  • Need for medical diagnosis, care, or treatment
  • Preventive care (including vaccinations, health screenings)

Family Member’s Health:

  • To care for a family member with mental or physical illness, injury, or health condition
  • Family member needs medical diagnosis, care, or treatment
  • Family member needs preventive care

Safe Time Uses

Employee or Family Member Experiencing Domestic Abuse, Sexual Assault, or Stalking:

Employees may use ESST to:

  • Seek medical attention related to physical or psychological injury or disability
  • Obtain services from a victim services organization
  • Obtain psychological or other counseling
  • Seek relocation or take steps to secure existing home
  • Seek legal advice or participate in legal proceedings
  • Participate in safety planning or take other actions to increase safety

Other Permitted Uses

Closure Due to Weather or Public Emergency:

  • Employee’s workplace closed by order of public official due to weather or public emergency
  • Employee needs to care for child whose school or place of care is closed due to weather or public emergency

Health Authority Determination:

  • When a health authority or health care professional determines that employee’s or family member’s presence in the community would jeopardize health of others due to communicable disease

Bereavement (Added 2025):

  • To make funeral arrangements
  • To attend a funeral service or memorial
  • To address financial or legal matters arising after the death of a family member

Source: Minn. Stat. § 181.9445, subd. 2; Minn. Stat. § 181.9447 (2025 amendments)

Definition of Family Member

According to Minn. Stat. § 181.9445, subd. 3, “family member” is defined to include:

  • Employee’s child (including biological, adopted, foster child, adult child, legal ward, child for whom employee is legal guardian, or child to whom employee stands in loco parentis)
  • Employee’s spouse
  • Employee’s sibling
  • Employee’s parent (including biological, adoptive, foster parent, stepparent, legal guardian, or person who stood in loco parentis when employee was a minor)
  • Employee’s grandchild
  • Employee’s grandparent
  • Employee’s stepchild
  • Employee’s stepparent

⚠️ Important: The statute uses broad definitions. “Child” includes adult children. “Parent” includes various parental relationships.

Source: Minn. Stat. § 181.9445, subd. 3

Payment Rate for ESST

According to Minn. Stat. § 181.9447 (as amended 2025), employers must pay employees using ESST at the employee’s “base rate” of pay.

Base Rate Defined:

For hourly employees: The rate the employee receives per hour of work

For employees with multiple hourly rates: The rate the employee would have been paid for the period during which leave is taken

For salaried employees: The same rate guaranteed to the employee as if they had not taken leave

For employees paid on commission, piecework, or other non-hourly basis: No less than the applicable local, state, or federal minimum wage (whichever is greater)

⚠️ Important: According to the 2025 amendments, the payment requirement was clarified to refer to “base rate” rather than allowing various interpretations.

Source: Minn. Stat. § 181.9447 (amended 2025); Minnesota DLI

Notice and Documentation

Employee Notice Requirements

Foreseeable Use:

According to Minn. Stat. § 181.9447, when the need for ESST is foreseeable, employers may require:

  • Advance notice of the employee’s intention to use ESST
  • But NOT more than seven (7) days’ advance notice

Unforeseeable Use:

When the need for ESST is not foreseeable, employees must provide notice:

  • As soon as practicable

⚠️ Important: Employers may establish reasonable notice procedures but cannot require more than seven days’ advance notice for foreseeable leave.

Employer Documentation Requirements

General Rule: Employers generally cannot require documentation for ESST use.

Exception: According to the statute, if an employee uses ESST for more than three (3) consecutive scheduled workdays, the employer may require reasonable documentation.

⚠️ Critical Clarification (2025 Amendment): The “three scheduled workdays” refers to days the employee was scheduled to work, not calendar days.

What Constitutes “Reasonable Documentation”:

According to Minnesota DLI guidance and statute, acceptable documentation may include:

  • For health-related uses: Documentation from a health care professional (does NOT need to specify diagnosis or details)
  • For safe time uses: Employee’s written statement OR documentation from victim services organization, attorney, police, court, or other appropriate source
  • For closure: Public announcement of closure OR employer’s own knowledge of closure
  • For bereavement (2025): Death certificate, published obituary, or other verification of death

Prohibited Requests:

Employers may NOT:

  • Require disclosure of details regarding domestic abuse, sexual assault, or stalking
  • Require disclosure of specific medical diagnosis
  • Require more documentation than reasonably necessary to verify leave purpose
  • Impose unreasonable documentation requirements

Source: Minn. Stat. § 181.9447; Minnesota DLI guidance

Employer Obligations

According to Minnesota Statutes §§ 181.9446-181.9448, employers have the following general obligations:

1. Provide ESST Tracking Information

Requirement: At the end of each pay period, employers must provide employees with information about:

  • Total number of ESST hours available for use
  • Total number of ESST hours used in the pay period

How to Provide (2025 Clarification):

According to 2025 amendments, employers may choose a reasonable system for providing this information, including:

  • On or attached to earnings statement (pay stub)
  • In an electronic system where employees can access information during regular working hours
  • Other reasonable methods

If Electronic: Employer must provide employees with access to an employer-owned computer during regular working hours to view and print information.

⚠️ Note: This was changed from a requirement to provide on the earnings statement to allow more flexibility in how information is communicated.

2. Provide Written Notice

At Hire:

Employers must provide written notice of ESST rights:

  • At the time of hire (for new employees)
  • OR by January 1, 2024 (for existing employees when law took effect)
  • In English AND in employee’s primary language if not English

Content: Notice must inform employees about ESST rights, including accrual, use, and carryover.

Model Notice: Minnesota DLI has created a uniform notice employers may use, available in multiple languages: https://www.dli.mn.gov/sick-leave

3. Include in Employee Handbook

If the employer has an employee handbook, the employer must include ESST information in the handbook.

4. Workplace Poster

Employers must display the ESST workplace poster where employees can easily see it.

Poster Available: Minnesota DLI – https://www.dli.mn.gov/sick-leave

5. Maintain Records

Employers must maintain records related to ESST for at least three (3) years, including:

  • Hours worked by employees
  • ESST accrued by employees
  • ESST used by employees
  • Documentation supporting employer’s determination regarding ESST eligibility

6. Maintain Insurance Coverage During ESST Use

According to Minn. Stat. § 181.9447, during use of ESST, employers must maintain coverage under any group insurance policy, group subscriber contract, or health care plan for the employee and any dependents, as if the employee was not on leave.

However: The employee must continue to pay any employee share of the cost of benefits.

Source: Minnesota Statutes §§ 181.9446-181.9448; Minnesota DLI guidance

Interaction with Other Leave

Existing PTO/Paid Leave Policies

According to Minnesota law and DLI guidance:

Can PTO Satisfy ESST?

Yes. An employer’s existing paid time off (PTO), vacation, or paid leave policy may satisfy ESST requirements IF:

  • The policy provides at least the same amount of leave as required by ESST
  • The leave accrues at least as quickly as required by ESST
  • The leave may be used for the same purposes as ESST
  • All other ESST requirements are met

Name Doesn’t Matter: The leave does not need to be called “Earned Sick and Safe Time” to satisfy the requirement.

Relationship with FMLA

ESST may run concurrently with leave under the federal Family and Medical Leave Act (FMLA) when the reason for leave qualifies under both laws.

⚠️ Important: Employees may choose to use ESST during FMLA leave to receive pay. Employers cannot require employees to exhaust ESST before taking unpaid FMLA leave.

Local ESST Ordinances

Critical Note: The cities of Bloomington, Minneapolis, and St. Paul have their own ESST ordinances that may provide additional requirements beyond state law.

Employer Obligation: According to Minnesota DLI, when both state and local ESST laws apply, employers must comply with the requirements most favorable to employees.

What This Means:

  • Determine which provisions are more favorable on a requirement-by-requirement basis
  • Apply the more generous provision for each specific requirement
  • Consult local ordinances for specific provisions

Resources:

Source: Minnesota DLI guidance

Prohibition on Retaliation

According to Minn. Stat. § 181.9448, employers are prohibited from:

  • Retaliating against employees for requesting or using ESST
  • Discriminating against employees for exercising ESST rights
  • Interfering with or restraining employees’ ESST rights
  • Requiring employees to find replacement workers in order to use ESST
  • Counting ESST as an absence that may lead to adverse action

Examples of Prohibited Actions:

  • Termination for using ESST
  • Demotion or reduction in hours for requesting ESST
  • Disciplinary points for absences covered by ESST
  • Requiring employee to find coverage before using ESST
  • Denying promotion due to ESST use

Source: Minn. Stat. § 181.9448

Enforcement and Remedies

Enforcement Agency

The Minnesota Department of Labor and Industry enforces ESST requirements.

Contact:

Remedies (2025 Amendments)

According to Minn. Stat. § 181.9448 (as amended 2025), an employer that fails to provide or allow ESST use as required is liable to employees for:

1. ESST Hours Owed:

  • The amount of ESST the employee should have been provided or could have used

2. Liquidated Damages:

  • An equal amount as liquidated damages

What This Means:

  • If employer failed to provide 48 hours of ESST, liability = 48 hours of pay + 48 hours as liquidated damages (96 hours total)
  • If employer prevented use of 16 hours of ESST, liability = 16 hours of pay + 16 hours as liquidated damages (32 hours total)

If Exact Amount Unclear:

  • Employers are liable for 48 hours each year ESST was not provided, plus an equal amount as liquidated damages

Private Right of Action

Employees may also bring civil lawsuits to address ESST violations.

Source: Minn. Stat. § 181.9448 (amended 2025)

Application to Remote Workers

General Principle:

ESST requirements apply to employees working remotely from Minnesota in the same manner as on-site workers, provided the employee meets eligibility requirements (anticipated to work at least 80 hours in a year for an employer in Minnesota).

Key Considerations for Remote Work:

  • Remote workers working from Minnesota locations are covered
  • Accrual based on hours actually worked
  • All permitted uses apply equally to remote workers
  • Notice and documentation requirements apply
  • Employer cannot treat remote workers differently regarding ESST

For Remote Workers Outside Minnesota:

If an employee works entirely outside Minnesota, whether Minnesota ESST applies depends on complex factors including where the work is performed and the employee’s relationship with Minnesota. Consult legal counsel for multi-state remote workforce situations.

Source: Minnesota DLI; general legal principles

Workers' Compensation Overview

Legal Framework

Statutory Authority: Minnesota Statutes Chapter 176
Administering Agency: Minnesota Department of Labor and Industry, Workers’ Compensation Division

Contact Information:

Source: Minnesota Statutes Chapter 176

General Coverage Requirements

According to Minnesota Statutes Chapter 176, workers’ compensation coverage is generally required in Minnesota.

General Rule: According to Minn. Stat. § 176.041, all employers are generally required to purchase workers’ compensation insurance or become self-insured.

Employer Defined:

According to the statute, an “employer” is generally any person who hires others to perform services.

Employee Defined:

An “employee” is generally any person who performs services for another for hire, including:

  • Full-time employees
  • Part-time employees
  • Temporary employees
  • Seasonal employees
  • Minors
  • Non-citizen workers

⚠️ Note: Determining whether someone is an “employee” for workers’ compensation purposes requires application of classification tests (see Part 1 for classification framework).

Source: Minn. Stat. §§ 176.011, 176.041; Minnesota DLI

Minnesota’s Workers’ Compensation System

According to Minnesota DLI, Minnesota’s workers’ compensation system provides:

  • Medical treatment for work-related injuries and illnesses
  • Wage replacement benefits for time unable to work
  • Vocational rehabilitation services if needed
  • Permanent partial disability benefits if applicable
  • Death benefits for surviving dependents

System Structure:

Minnesota operates a mixed system:

  • Employers may purchase insurance from private insurance companies
  • Employers may self-insure if qualified
  • Some employers are self-insured with reinsurance
  • Minnesota has assigned risk pools for employers unable to obtain coverage

Source: Minnesota Department of Labor and Industry

Compensability Standard

According to Minnesota workers’ compensation law and case law, for an injury or illness to be compensable, it must:

1. Arise Out of Employment: The injury must have a causal connection to the employment.

2. Occur in the Course of Employment: The injury must occur during a period when the employee is performing duties related to employment.

⚠️ Important: BOTH elements must be present. The “arising out of and in the course of” standard is applied based on the specific facts of each case.

Source: Minnesota Statutes Chapter 176; Minnesota case law

Remote Worker Coverage Considerations

⚠️ COMPLEX AND FACT-SPECIFIC: Coverage of injuries occurring during remote work involves detailed factual analysis. The following is general background only and does NOT constitute coverage determinations.

General Principles

According to general workers’ compensation principles and Minnesota law:

  • Workers’ compensation coverage typically extends to employees regardless of work location
  • The key question is whether the injury “arose out of and in the course of employment”
  • Application to remote work settings is fact-dependent

Factors That May Be Considered

According to various Minnesota workers’ compensation decisions and guidance, factors that may be relevant in analyzing remote work injuries include:

Nature of Activity:

  • Was the employee engaged in a work-related task at time of injury?
  • Was the activity required or expected by employer?
  • Did the activity serve employer’s interests?

Location:

  • Was the injury location a designated work area?
  • Did employer know of and authorize the home office setup?
  • Was the area used exclusively or primarily for work?

Timing:

  • Did the injury occur during work hours?
  • Was the employee on-call or expected to be available?
  • Had the employee started or finished their workday?

Employer Control:

  • Did employer provide equipment or workspace?
  • Did employer have knowledge of work setup?
  • Did employer require or encourage remote work?

⚠️ CRITICAL: These factors are not exhaustive, and no single factor is determinative. Each case is evaluated based on its complete circumstances.

Source: General Minnesota workers’ compensation principles; various MN Workers’ Compensation Court of Appeals decisions

Illustrative Scenarios (For General Understanding Only)

⚠️ IMPORTANT: The following scenarios are provided for general educational purposes only. They do NOT constitute:

  • Coverage determinations
  • Legal advice
  • Predictions of how the Minnesota DLI or Workers’ Compensation Court of Appeals would decide actual cases
  • Recommendations regarding filing or not filing claims

Every injury is unique. Actual coverage depends on official determination based on all facts.

Scenario Category: Work-Related Activities in Designated Home Office

Example Situation: An employee who has a designated home office (known to and approved by employer) trips over computer cables while retrieving work-related documents from a file cabinet during regular work hours.

General Observations: This type of scenario may share some characteristics with situations that have historically been found compensable, such as:

  • The activity (retrieving work documents) was work-related
  • The injury occurred in a designated work area
  • The injury occurred during work hours
  • The employer knew of and approved the home office arrangement

However: Actual compensability would require analysis of additional factors including:

  • The specific circumstances of the trip and fall
  • Whether the hazard (cables) was under employer’s control or knowledge
  • The complete work arrangement between employee and employer
  • Other relevant facts

This is NOT a coverage determination. Official determination would be made by Minnesota DLI Workers’ Compensation Division based on complete factual circumstances.

Example Situation: An employee develops carpal tunnel syndrome from extensive computer work performed from home as required by their job duties.

General Observations: Repetitive stress injuries from work activities may potentially be compensable in some circumstances, but determination depends on factors such as:

  • Medical documentation establishing work-relatedness
  • Proof that the condition arose from employment duties
  • Comparison with pre-existing conditions if any
  • Medical and factual analysis

This is general background only. Not a coverage determination. Consult medical professionals for injury evaluation and Minnesota DLI for coverage questions.

Scenario Category: Personal Comfort Activities

Example Situation: An employee is injured while preparing a personal meal in their kitchen during their designated lunch break.

General Observations: Personal comfort activities unrelated to work duties and occurring during breaks from work may be less likely to be considered arising out of employment, based on general principles. However, specific facts matter, including:

  • Whether employee was completely relieved of all duties
  • Whether meal preparation was related to employer’s activities
  • Specific timing and circumstances
  • Other relevant factors

This is general background only. Not a coverage determination.

Scenario Category: Mixed Work-Personal Activities

Example Situation: An employee trips on stairs in their home while going to retrieve work equipment from another room during work hours.

General Observations: This scenario involves movement within the home for a work purpose. Factors that may be relevant include:

  • Purpose of the activity (retrieving work equipment)
  • Whether the stairs/location was part of designated work area
  • Employer knowledge of workspace configuration
  • Timing during work hours
  • Other specific circumstances

Determination would depend on complete factual analysis.

This is NOT a coverage determination.

⚠️ FINAL CRITICAL DISCLAIMER ON SCENARIOS:

The scenarios above are purely illustrative examples for general educational purposes. They do NOT constitute:

  • Coverage determinations or predictions
  • Legal advice on workers’ compensation claims
  • Recommendations for filing or not filing claims
  • Guarantees of how Minnesota DLI would analyze these situations
  • Exhaustive analysis of relevant factors

Every workers’ compensation claim is unique and depends on its complete specific facts. Coverage determinations are made by Minnesota Department of Labor and Industry Workers’ Compensation Division and the Minnesota Workers’ Compensation Court of Appeals based on all relevant information.

For coverage questions on specific injuries:

  • Minnesota DLI Workers’ Compensation: 651-284-5005 or 800-342-5354
  • Workers’ compensation attorney
  • Your employer’s workers’ compensation insurance carrier or claims administrator

Benefits Generally Available

According to Minnesota Statutes Chapter 176, workers’ compensation benefits in Minnesota may include:

Medical Benefits:

  • All reasonable and necessary medical treatment
  • Hospital care
  • Medications
  • Physical therapy and rehabilitation
  • Medical equipment and supplies

Wage Replacement Benefits:

  • Temporary Total Disability (TTD): When unable to work at all
  • Temporary Partial Disability (TPD): When able to work but at reduced capacity
  • Permanent Total Disability (PTD): For permanent complete inability to work
  • Permanent Partial Disability (PPD): For permanent impairment

Vocational Rehabilitation:

  • Services to help return to work if needed

Death Benefits:

  • Benefits for surviving dependents if injury results in death

⚠️ Note: Specific benefit amounts are determined by statutory formulas and medical evaluations. Actual benefits depend on specific circumstances.

Source: Minnesota Statutes Chapter 176; Minnesota DLI

Reporting and Claim Process

For Employees:

According to Minnesota law, if you are injured at work:

  1. Report to Employer: Notify your employer as soon as possible (written notice within 180 days)
  2. Seek Medical Attention: Get necessary medical treatment
  3. File Claim: File claim with Minnesota DLI if necessary

For Employers:

According to Minnesota regulations, employers must:

  1. Report to Insurer: Report injury to workers’ compensation insurance carrier immediately
  2. File with State: File First Report of Injury with Minnesota DLI within 10 days for injuries resulting in more than 3 days lost time
  3. Provide Information: Give employee information about workers’ compensation rights

Forms and Resources:

Source: Minnesota Statutes Chapter 176; Minnesota DLI

Best Practices for Remote Work

⚠️ Note: The following are general recommendations only, not legal requirements. They may not be suitable for all situations. Consult legal counsel and safety professionals.

For Employers:

  • Consider providing guidance on ergonomic home office setup
  • Consider documenting remote work arrangements in writing
  • Consider developing clear injury reporting procedures for remote workers
  • Consider safety training for home-based workers
  • Consider clear policies distinguishing work time from personal time
  • Maintain regular communication about workplace safety

For Employees:

  • Consider establishing a dedicated work area
  • Consider following ergonomic guidelines
  • Report work-related injuries promptly to employer
  • Keep records of work hours and activities
  • Follow employer’s safety guidelines and procedures
  • Seek medical attention for work-related injuries

⚠️ Disclaimer: These recommendations do not guarantee workers’ compensation coverage and are not legal requirements. They are general suggestions only.

Source: Various employer safety resources; general best practices

⚠️ FINAL CRITICAL REMINDER: Workers’ compensation is a highly specialized area involving complex medical, legal, and factual determinations. Coverage questions should be directed to:

  1. Minnesota DLI Workers’ Compensation Division for official determinations: 651-284-5005, 800-342-5354
  2. Workers’ compensation attorney for legal advice
  3. Medical professionals for injury evaluation

This section is for general background information only and should not be relied upon for coverage determinations or legal decisions.

Information reflects sources available as of December 2025. Laws and interpretations may change.

Other Leave Entitlements

Minnesota provides several additional leave entitlements beyond ESST and workers’ compensation. The following is general background information only.

Pregnancy and Parenting Leave

Statutory Authority: Minnesota Statutes §§ 181.940 – 181.944
Official Source: https://www.revisor.mn.gov/statutes/cite/181.941

General Overview:

According to Minnesota law, employers must provide unpaid leave for pregnancy, childbirth, and parenting purposes.

Eligibility

According to Minn. Stat. § 181.941, employees are generally eligible for pregnancy and parenting leave regardless of:

  • Employer size (applies to all employers)
  • Length of employment (immediate eligibility)
  • Hours worked

⚠️ Significant Difference from FMLA: Unlike federal FMLA which requires 50+ employees and 12 months of service, Minnesota’s law has no employer size or tenure requirements.

Leave Entitlement

Amount: Up to 12 weeks of unpaid leave

Purposes:

  • Birth or adoption of a child (biological or adoptive parent)
  • Pregnancy-related medical care
  • Incapacity due to pregnancy, childbirth, or related conditions
  • Prenatal care

Timing:

  • Leave must be taken within 12 months of birth or adoption
  • Exception: If child must remain in hospital longer than mother, leave must be taken within 12 months after child leaves hospital

Employee Rights During Leave

According to the statute:

1. Health Insurance Continuation:

  • Employer must maintain coverage under group insurance policies
  • Employee must continue to pay employee share of premiums

2. Job Restoration:

  • Employee entitled to return to same position or comparable position with same duties, hours, and pay
  • Same benefits and seniority as before leave

3. Flexibility:

  • Employee may return to part-time work during leave without forfeiting right to return to full-time work at end of leave
  • Leave length determined by employee (up to 12 weeks)
  • Employee chooses when leave begins

4. Reasonable Notice:

  • Employer may adopt reasonable policies about timing of requests and notice required

Prohibition on Retaliation

According to Minn. Stat. § 181.943, employers cannot:

  • Discharge, discipline, or penalize employees for requesting or taking pregnancy/parenting leave
  • Interfere with, threaten, or retaliate against employees for exercising rights

Relationship to FMLA

When both Minnesota pregnancy/parenting leave and federal FMLA apply:

  • The two leaves run concurrently (same 12 weeks)
  • The law providing greater benefits applies to each specific provision
  • Employee receives most favorable treatment under either law

⚠️ Important Note: Starting January 1, 2026, Minnesota’s new Paid Family and Medical Leave (PFML) program will provide paid leave. See below for details.

Source: Minnesota Statutes §§ 181.940-181.944; Minnesota DLI – https://www.dli.mn.gov/parental-leave

Bone Marrow and Organ Donation Leave

Bone Marrow Donation Leave

Statutory Authority: Minnesota Statutes § 181.945
Official Source: https://www.revisor.mn.gov/statutes/cite/181.945

Coverage: Applies to employers with 20 or more employees

Leave Entitlement:

  • Up to 40 work hours of PAID leave for bone marrow donation
  • Length determined by employee
  • Employer may require physician verification of purpose and length
  • May be extended beyond 40 hours by employer agreement

Protection: If employee is medically determined not to qualify as donor, paid leave granted prior to that determination is not forfeited.

Prohibition on Retaliation: Employer cannot retaliate against employee for requesting or taking bone marrow donation leave.

Organ Donation Leave

Statutory Authority: Minnesota Statutes § 181.9456
Official Source: https://www.revisor.mn.gov/statutes/cite/181.9456

Coverage: Applies to employers with 20 or more employees

Leave Entitlement:

  • Up to 40 work hours of PAID leave per organ donation
  • Length determined by employee
  • Employer may require physician verification
  • May be extended by employer agreement

Protection: If employee is medically determined not to qualify as donor, paid leave granted prior to that determination is not forfeited.

Prohibition on Retaliation: Employer cannot retaliate against employee for requesting or taking organ donation leave.

⚠️ Note: These are PAID leave requirements for covered employers (20+ employees). This is distinct from unpaid leave protections.

Source: Minnesota Statutes §§ 181.945, 181.9456

School Conference and Activities Leave

Statutory Authority: Minnesota Statutes § 181.9412
Official Source: https://www.revisor.mn.gov/statutes/cite/181.9412

General Rule:

According to Minn. Stat. § 181.9412, employees may use accrued paid leave (such as vacation or sick leave) to attend school conferences or school-related activities for their children.

What This Means:

  • Employers that provide paid leave (sick leave, vacation, PTO) must allow employees to use it for school conferences and activities
  • This applies to existing leave policies – it does not create new leave
  • Applies to employees’ own children’s school activities

Application:

Employees may use leave on the same terms they use sick leave for their own illnesses or injuries.

Source: Minnesota Statutes § 181.9412

Sick Leave for Family Care

Statutory Authority: Minnesota Statutes § 181.9413
Official Source: https://www.revisor.mn.gov/statutes/cite/181.9413

General Rule:

Employees must be permitted to use sick leave benefits (if provided by employer) to care for sick or injured children on the same terms they use sick leave for their own illnesses.

What This Means:

  • If employer offers sick leave, it must be available for care of sick children
  • Applies to accrued sick leave policies employer chooses to offer
  • Does not mandate that employers provide sick leave
  • Does not apply to short-term/long-term disability plans

⚠️ Note: This requirement predates and is separate from ESST, which has broader family member coverage and mandatory accrual.

Source: Minnesota Statutes § 181.9413

Minnesota Paid Family and Medical Leave (PFML) – Starting January 1, 2026

⚠️ MAJOR NEW PROGRAM: Minnesota’s comprehensive Paid Family and Medical Leave program becomes effective January 1, 2026. This section provides a brief overview only. Detailed guidance will be provided by Minnesota DEED.

Statutory Authority: Minnesota Statutes Chapter 268B
Administering Agency: Minnesota Department of Employment and Economic Development (DEED), Family and Medical Benefits Insurance Division
Official Website: https://pl.mn.gov/

Program Overview

According to Minnesota Statutes Chapter 268B, starting January 1, 2026, Minnesota will provide:

Medical Leave: Up to 12 weeks per year for employee’s own serious health condition

Family Leave: Up to 12 weeks per year to care for family member or bond with new child

Combined Maximum: 20 weeks total in a 12-month period (if employee needs both types)

Payment: Partial wage replacement based on sliding scale:

  • Higher percentage (up to 90%) for lower earners
  • Lower percentage (minimum 55%) for higher earners
  • Maximum weekly benefit: State average weekly wage (approximately $1,423 in 2026)

Job Protection: Position protected after 90 days of employment

Eligibility

Employee Requirements:

  • Must have earned at least $3,900 (approximately 5.3% of state average annual wage) in base period
  • Base period: Generally last 4 completed calendar quarters before leave starts

Employer Coverage:

  • All employers with employees in Minnesota, regardless of size

Funding

Premium Rate: 0.88% of wages (as of 2026)

  • Split between employer (0.44%) and employee (0.44%)
  • Employers with 30 or fewer employees may qualify for reduced rate
  • Maximum employee contribution capped

Collection: Payroll deductions begin January 1, 2026

Private Plan Option

Employers may apply for approval to provide equivalent private plan in lieu of state program.

Deadline: For January 1, 2026 effective date, applications should be submitted by November 10, 2025.

Requirements: Private plan must provide equal or greater benefits and protections.

Key Dates

  • January 1, 2026: Benefits available; premiums begin
  • April 30, 2026: First payroll taxes due to state
  • December 1, 2025: Employers must notify employees about PFML

Interaction with Other Leave

FMLA: PFML may run concurrently with FMLA when both apply

ESST: Employees may use vacation, sick pay, or PTO “in lieu of” PFML benefits if concurrently eligible

Pregnancy and Parenting Leave: PFML provides paid version of previously unpaid leave

⚠️ Complex Area: Coordination of multiple leave laws requires careful analysis. Consult legal counsel.

Resources

⚠️ IMPORTANT: This is a brief overview only. Minnesota DEED is providing detailed guidance and resources. Employers should:

  • Visit pl.mn.gov for complete information
  • Register for email updates from Minnesota Paid Leave
  • Review employer obligations and deadlines
  • Consider whether to apply for private plan option
  • Consult legal counsel for policy development

Source: Minnesota Statutes Chapter 268B; Minnesota DEED Paid Leave – https://pl.mn.gov/

Anti-Discrimination Laws

Minnesota Human Rights Act (MHRA)

Statutory Authority: Minnesota Statutes Chapter 363A
Official Source: https://www.revisor.mn.gov/statutes/cite/363A
Administering Agency: Minnesota Department of Human Rights

Contact Information:

  • Website: https://mn.gov/mdhr/
  • Phone: 651-539-1100 (Twin Cities) or 800-657-3704 (toll-free)
  • Address: Freeman Building, 625 Robert Street North, St. Paul, MN 55155

Source: Minnesota Department of Human Rights

Overview and Recent Amendments

The Minnesota Human Rights Act is generally considered one of the strongest civil rights laws in the United States. According to Minn. Stat. § 363A.08, the MHRA prohibits discrimination in employment based on protected characteristics.

⚠️ Significant 2024 Amendments: On May 15, 2024, Governor Walz signed major amendments to the MHRA, effective August 1, 2024. These amendments expanded protections, remedies, and enforcement mechanisms.

Source: 2024 Minn. Laws, Ch. 105 (H.F. 4109)

Protected Classes

According to Minnesota Statutes § 363A.08 (as amended 2024), Minnesota law generally prohibits employment discrimination based on the following protected characteristics:

1. Race
2. Color
3. Creed
4. Religion
5. National Origin
6. Sex (including pregnancy, childbirth, and related conditions)
7. Gender Identity
8. Marital Status
9. Familial Status (amended 2024 to expand definition)
10. Disability
11. Status with Regard to Public Assistance
12. Sexual Orientation
13. Age (if 18 years or older)

⚠️ Important 2024 Amendment: The amendments now expressly recognize that discrimination can be based on “one or more” protected characteristics (intersectional discrimination).

Familial Status Expansion (2024): According to the 2024 amendments, “familial status” now includes:

  • Parents and guardians with custody or written permission to care for a child
  • Those who reside with and care for adults with disabilities who need assistance

Source: Minn. Stat. § 363A.03; 2024 amendments

Prohibited Employment Practices

According to Minn. Stat. § 363A.08, it is generally an unfair discriminatory practice for an employer to:

1. Hiring, Firing, and Terms of Employment

Prohibited Actions:

  • Refuse to hire, receive applications, or recruit because of protected characteristic
  • Discharge an employee or discriminate in terms of compensation, terms, conditions, or privileges of employment because of protected characteristic

What This Means: Employers may not make employment decisions based on an applicant’s or employee’s protected status. This applies to all aspects of employment including hiring, promotion, pay, benefits, termination, and working conditions.

2. Information Requests

Prohibited Actions:

  • Seek or obtain information from any source that pertains to protected characteristics, unless:
    • For sole purpose of compliance with Public Contracts Act, OR
    • Required by federal or state law

What This Means: Employers generally cannot ask about or investigate protected characteristics during hiring or employment, with limited exceptions for legal compliance purposes.

3. Discriminatory Advertisements

Prohibited Actions:

  • Publish notices or advertisements relating to employment that disclose preference, limitation, specification, or discrimination based on protected characteristic

What This Means: Job postings and recruitment materials may not indicate preferences based on protected status (e.g., “young team,” “recent grad,” specific gender pronouns suggesting preference).

Source: Minn. Stat. § 363A.08

Harassment as Discrimination (2024 Amendment)

According to the 2024 amendments, the definition of “discriminate” was clarified to explicitly include “harassment” based on any protected characteristic.

Previous Law: The MHRA previously limited the harassment definition primarily to sexual harassment.

Current Law (2024): “Discriminate” now includes harassment based on any protected class (race, religion, disability, age, etc.).

What This Means: Harassment based on any protected characteristic is now explicitly recognized as an unfair discriminatory practice under the MHRA.

Source: 2024 Minn. Laws, Ch. 105, sec. 3 (amending Minn. Stat. § 363A.03, subd. 13)

Reasonable Accommodations

Disability Accommodations

According to the MHRA and Minnesota case law, employers generally must provide reasonable accommodations for qualified individuals with disabilities, unless doing so would impose an undue hardship.

What Constitutes “Reasonable Accommodation”:

According to Minnesota Department of Human Rights guidance and statute, reasonable accommodations may include:

  • Modifications to work environment or how work is performed
  • Modifications to work schedule
  • Leave of absence
  • Reassignment to vacant position
  • Acquisition or modification of equipment
  • Adjustments to training materials or policies
  • Providing readers or interpreters

“Undue Hardship” Standard:

An employer may refuse accommodation if it would impose an “undue hardship,” which generally means:

  • Significant difficulty or expense in relation to size, resources, and nature of employer’s operation
  • Fundamental alteration of nature or operation of business

⚠️ Interactive Process: Employers are generally expected to engage in an interactive process with employees to identify reasonable accommodations.

Pregnancy Accommodations

Statutory Authority: Minnesota Statutes § 181.939

According to Minn. Stat. § 181.939 (as amended 2023), employers must provide reasonable accommodations for pregnancy, childbirth, and related conditions.

Required Accommodations (No Medical Documentation Required):

  • More frequent or longer restroom breaks
  • Food and water breaks
  • Seating

Additional Accommodations (With Medical Documentation):

  • Temporary leave of absence
  • Modification in work schedule
  • Job assignments modifications
  • Limits to heavy lifting
  • Temporary transfer to less strenuous or hazardous position
  • Other accommodations advised by health care provider or doula

Coverage: According to 2023 amendments, pregnancy accommodation requirements now apply to all employers with one or more employees (previously applied only to employers with 15+ employees).

Source: Minn. Stat. § 181.939; 2023 amendments

Religious Accommodations

According to the MHRA and federal law, employers generally must reasonably accommodate sincerely held religious beliefs and practices, unless doing so would impose an undue hardship.

Examples of Religious Accommodations:

  • Schedule changes to avoid conflicts with religious observances
  • Exceptions to dress code for religious attire
  • Voluntary shift swaps
  • Modifications to job duties that conflict with religious beliefs

Source: Minn. Stat. § 363A.08; Minnesota Department of Human Rights guidance

Retaliation Prohibition

According to Minn. Stat. § 363A.15, it is generally an unfair discriminatory practice to:

  • Retaliate against any person who opposes a discriminatory practice
  • Retaliate against any person who files a charge, testifies, assists, or participates in an investigation or proceeding under the MHRA

What This Means: Employers cannot take adverse action against employees for:

  • Complaining about discrimination
  • Filing a charge with Minnesota Department of Human Rights
  • Testifying in an investigation or hearing
  • Assisting others in asserting their rights

Examples of Prohibited Retaliation:

  • Termination
  • Demotion
  • Salary reduction
  • Unfavorable schedule changes
  • Unfavorable work assignments
  • Creating a hostile work environment

Source: Minn. Stat. § 363A.15

Filing a Charge of Discrimination

Time Limits

Minnesota Charge Deadline:

According to Minn. Stat. § 363A.28, charges must generally be filed with the Minnesota Department of Human Rights within one (1) year of the alleged discriminatory act.

Federal Charge Deadline:

For charges filed with the federal Equal Employment Opportunity Commission (EEOC), the deadline is generally 300 days from the discriminatory act.

⚠️ Important: Time limits are strictly enforced. Employees who believe they have experienced discrimination should act promptly.

Filing Process

Step 1: Contact Minnesota Department of Human Rights

Step 2: Intake Interview

The MDHR will conduct an intake interview to gather information about the alleged discrimination.

Step 3: Investigation

If the charge is accepted, MDHR will investigate. According to 2024 amendments, the Commissioner must make a determination of probable cause or no probable cause within one year of filing (unless tolled).

Step 4: Mediation Opportunity (2024 Amendment)

According to 2024 amendments, MDHR must now offer both parties the opportunity to resolve charges through mediation or other alternative dispute resolution.

Step 5: Determination and Resolution

  • If probable cause found: Case may proceed to hearing or settlement
  • If no probable cause found: Employee may file in district court within 90 days (2024 amendment changed this from 45 days to 90 days)

Source: Minn. Stat. § 363A.28; 2024 amendments

Remedies and Damages (Significantly Expanded in 2024)

According to the 2024 amendments to Minn. Stat. § 363A.33, prevailing parties in MHRA cases may now receive significantly expanded remedies:

Compensatory Damages

New Treble Damages Provision (2024):

According to the amendments, compensatory damages may be awarded in an amount up to three (3) times the actual damages sustained.

What This Includes:

  • Back pay
  • Front pay
  • Mental anguish and suffering
  • Other economic and non-economic damages

⚠️ Significant Change: Previously, emotional distress damages were capped at $25,000. The 2024 amendments removed this cap and allow trebling of compensatory damages.

Jury Determination (2024): Compensatory damages (including whether they are trebled) and punitive damages are now determined by the jury, not the judge.

Punitive Damages

According to the 2024 amendments, punitive damages may be awarded in employment discrimination cases.

Previous Law: Punitive damages were generally not available in MHRA employment cases.

Current Law (2024): Punitive damages are now available and determined by jury.

Equitable Remedies

According to Minn. Stat. § 363A.33 (as amended 2024), courts may order:

  • Hiring, reinstatement, promotion, admission, or upgrading of aggrieved party (with or without back pay)
  • Admission or restoration to membership in labor organization
  • Admission to or participation in training programs
  • Any other relief the court deems just and equitable

Attorneys’ Fees and Civil Penalties

  • Attorneys’ fees: Determined by trial judge
  • Civil penalties: Payable to state general fund, determined by trial judge

Source: Minn. Stat. § 363A.33 (amended 2024); 2024 Minn. Laws, Ch. 105

Service Animals (2024 Amendment)

According to Minn. Stat. § 363A.19 (as amended 2024), it is now an unfair discriminatory practice to prohibit any individual with a disability from taking a service animal into a public place.

Previous Law: Protection was limited to blind, deaf, or persons with “physical or sensory disability.”

Current Law (2024): Protection extended to any person with a disability and their service animal.

Requirements:

  • Service animal must be properly harnessed or leashed
  • Individual with disability must maintain control over service animal
  • No charge may be imposed for having service animal

Source: Minn. Stat. § 363A.19 (amended 2024)

Application to Remote Workers

The MHRA’s protections generally apply to remote workers in the same manner as on-site workers.

Key Points:

  • Protected characteristics apply equally to remote and on-site employees
  • Discrimination in hiring, promotion, termination, or terms of employment is prohibited regardless of work location
  • Harassment protections apply to virtual communications and meetings
  • Reasonable accommodations requirements apply to remote work arrangements
  • Retaliation protections apply equally

Remote Work Considerations:

Accommodations: Remote work itself may be a reasonable accommodation for certain disabilities. Employers should consider remote work options when evaluating accommodation requests.

Harassment: Harassment can occur in virtual meetings, emails, instant messages, and other electronic communications. The same standards apply.

Discriminatory Questions: Employers cannot ask discriminatory questions during remote interviews any more than during in-person interviews.

Source: Minnesota Department of Human Rights; general employment law principles

Federal Anti-Discrimination Laws

In addition to the MHRA, federal laws also prohibit employment discrimination. Federal and state protections may overlap, and employees may file charges under both.

Major Federal Laws:

  • Title VII of the Civil Rights Act of 1964: Prohibits discrimination based on race, color, religion, sex (including pregnancy, sexual orientation, and gender identity), and national origin
  • Age Discrimination in Employment Act (ADEA): Prohibits age discrimination against individuals 40 or older
  • Americans with Disabilities Act (ADA): Prohibits disability discrimination and requires reasonable accommodations
  • Pregnancy Discrimination Act (PDA): Prohibits pregnancy discrimination (part of Title VII)
  • Genetic Information Nondiscrimination Act (GINA): Prohibits discrimination based on genetic information

Federal Agency: U.S. Equal Employment Opportunity Commission (EEOC)

  • Website: https://www.eeoc.gov
  • Phone: 1-800-669-4000
  • Minneapolis Office: 330 South Second Avenue, Suite 430, Minneapolis, MN 55401-2233

Source: Federal anti-discrimination statutes; EEOC

Data Privacy Considerations

Overview

Minnesota has enacted comprehensive data privacy legislation that affects how businesses collect, use, and protect personal information. For employment contexts, several laws and principles apply.

Minnesota Consumer Data Privacy Act (MNCDPA)

Statutory Authority: Minnesota Statutes Chapter 325O (H.F. 4757)
Effective Date: July 31, 2025
Enforcing Agency: Minnesota Attorney General
Official Information: https://www.ag.state.mn.us/

⚠️ Important Limitation: The MNCDPA defines “consumer” as a Minnesota resident acting in an individual or household context, NOT in a commercial or employment context.

What This Means: According to the statute, the MNCDPA generally does NOT apply to:

  • Job applicants
  • Employees
  • Individuals acting as business representatives

However: Employers should still be aware of the MNCDPA as it may affect:

  • Collection of personal information from job applicants before they become applicants
  • Collection of information from website visitors
  • Processing of personal data for non-employment purposes
  • Contractor and vendor compliance requirements

Source: Minnesota Statutes Chapter 325O; MNCDPA definitional provisions

Key MNCDPA Provisions (For General Business Context)

Coverage

The MNCDPA generally applies to legal entities that:

  • Conduct business in Minnesota or produce products/services targeted to Minnesota residents; AND
  • Meet one of the following thresholds:
    • Control or process personal data of 100,000+ consumers per year (excluding payment transactions), OR
    • Derive over 25% of gross revenue from sale of personal data AND process or control personal data of 25,000+ consumers

Small Business Exemption: Entities meeting the U.S. Small Business Administration’s definition of “small business” are generally exempt.

Consumer Rights

The MNCDPA provides Minnesota consumers with rights to:

  • Access their personal data
  • Correct inaccurate personal data
  • Delete personal data
  • Obtain a copy of personal data
  • Opt out of targeted advertising, sale of personal data, and certain profiling

New Right (Unique to Minnesota): Right to question profiling decisions

Controller Obligations

Data Inventory Requirement (First-in-Nation):

According to the MNCDPA, controllers must maintain an inventory of data that must be managed to comply with the law.

⚠️ Significant: This is the first state privacy law to explicitly require a data inventory (also called data mapping).

Chief Privacy Officer Requirement (First-in-Nation):

The MNCDPA requires controllers to designate an individual with responsibility for privacy compliance. While not explicitly called a “Chief Privacy Officer,” this mirrors GDPR’s Data Protection Officer requirement.

Data Protection Assessments:

Controllers must conduct and document data protection assessments for certain high-risk processing activities, including:

  • Targeted advertising
  • Sale of personal data
  • Processing sensitive data
  • Profiling that presents heightened risk of harm

Security Practices:

Controllers must establish, implement, and maintain reasonable data security practices.

Enforcement

Enforcement: Minnesota Attorney General (exclusive enforcement authority)

Cure Period: 30-day cure period (sunsets January 31, 2026)

Penalties: Up to $7,500 per violation

No Private Right of Action: Consumers cannot file lawsuits; only AG can enforce

Source: Minnesota Statutes Chapter 325O; Minnesota Attorney General guidance

Minnesota Government Data Practices Act

Statutory Authority: Minnesota Statutes Chapter 13
Official Source: https://www.revisor.mn.gov/statutes/cite/13

According to Minnesota Statutes Chapter 13, the Minnesota Government Data Practices Act governs how government entities collect, use, and disseminate data about individuals.

Application: This Act generally applies to government entities and data they collect, including:

  • State agencies
  • Local governments
  • Public schools and universities

Key Provisions:

  • Data classifications (public, private, confidential)
  • Access rights for data subjects
  • Security and retention requirements
  • Disclosure limitations

Employment Context: Government employers must comply with Chapter 13 regarding employee data, including personnel records, disciplinary records, and other employment-related information.

Source: Minnesota Statutes Chapter 13

Electronic Communications Privacy

Minnesota Wiretap Law

Statutory Authority: Minnesota Statutes § 626A.02

According to Minnesota law, it is generally illegal to intercept or record oral or electronic communications without consent of at least one party to the communication.

One-Party Consent: Minnesota is a “one-party consent” state, meaning recording is generally legal if one party to the communication consents (including the person doing the recording).

Employment Context:

  • Employers may generally record business communications with employee knowledge
  • Covert monitoring of communications without notice may raise legal issues
  • Monitoring of personal communications may violate privacy expectations

⚠️ Important: Even where legal, workplace monitoring and recording should be disclosed to employees. Consult legal counsel before implementing monitoring programs.

Source: Minn. Stat. § 626A.02

Employee Monitoring Best Practices

While specific Minnesota laws addressing employee monitoring in remote work contexts are limited, general principles and best practices include:

Notice and Transparency

Best Practice: According to employment law attorneys and privacy professionals, employers should:

  • Provide clear written policies about what will be monitored
  • Explain the purpose and scope of monitoring
  • Obtain employee acknowledgment of monitoring policies
  • Update policies as monitoring practices change

Reasonable Monitoring

Best Practice: Limit monitoring to:

  • Work-related activities and communications
  • Business hours (avoid monitoring outside work hours without explicit consent)
  • Company-provided devices and systems (personal devices raise additional privacy concerns)

Data Security

Best Practice: Protect monitored data through:

  • Access controls (limit who can access monitoring data)
  • Encryption of sensitive data
  • Regular security audits
  • Data retention and deletion policies

Specific Considerations for Remote Work

GPS Tracking: Generally acceptable for company vehicles and devices during work hours for work purposes. Avoid tracking personal vehicles or during non-work hours without explicit consent.

Video Surveillance: Generally acceptable for company offices. Home monitoring raises significant privacy concerns and should generally be avoided unless explicitly consented to for specific business purposes.

Email and Internet Monitoring: Generally acceptable for company systems with proper notice. Distinguish between personal and work communications.

Productivity Software: Keyloggers, screenshots, and activity monitoring software should be disclosed and limited to work hours and work devices.

⚠️ Disclaimer: These are general best practices, not legal requirements. Specific situations require legal analysis. Consult employment and privacy counsel before implementing monitoring programs.

Source: Employment law best practices; privacy professionals’ guidance

Social Media Privacy

Statutory Authority: Minnesota Statutes § 181.983

According to Minn. Stat. § 181.983, employers are generally prohibited from:

  • Requesting or requiring an employee or applicant to disclose username, password, or other authentication information for accessing personal social media accounts
  • Requiring an employee or applicant to add the employer to their social media contacts
  • Compelling an employee or applicant to access personal social media in employer’s presence

What Employers CAN Do:

  • Request access to employee-created accounts that are used for business purposes
  • Require disclosure of information reasonably believed to be relevant to investigation of employee misconduct or violation of law
  • Access information about employees that is publicly available

⚠️ Important: This law protects personal social media accounts, not business accounts created for the employer.

Source: Minn. Stat. § 181.983

Data Breach Notification

Statutory Authority: Minnesota Statutes § 325E.61

According to Minnesota law, if a business experiences a breach of security involving personal information, the business generally must:

Notify Affected Individuals:

  • Provide notice “in the most expedient time possible and without unreasonable delay”
  • Notice must be provided by mail or electronically

Notify Minnesota Attorney General:

  • If breach involves more than 500 Minnesota residents, must notify AG’s office within 48 hours

Offer Credit Monitoring:

  • Must offer at least 12 months of free credit monitoring services if social security numbers were compromised

What Constitutes “Personal Information”:

According to the statute, personal information includes:

  • Name in combination with Social Security number, driver’s license number, or financial account information
  • Username/email with password or security questions

Employment Context: Breaches involving employee personal information trigger notification obligations.

Source: Minn. Stat. § 325E.61

Remote Work Specific Considerations

Contractual Considerations

Remote Work Agreements

Best Practice: Employers may consider documenting remote work arrangements in writing to clarify:

Location:

  • Where employee will work (specific address or general location)
  • Whether employee can relocate without notice
  • Multi-state work considerations

Schedule:

  • Expected work hours and availability
  • Flexibility in scheduling
  • Time zone considerations

Equipment and Expenses:

  • What equipment employer will provide
  • Reimbursement policies for internet, phone, workspace costs
  • Maintenance and return of equipment

Workspace Requirements:

  • Safety expectations for home workspace
  • Ergonomic considerations
  • Privacy and security requirements

Performance Expectations:

  • Communication requirements
  • Productivity standards
  • Meeting attendance expectations

Termination of Remote Work:

  • Circumstances under which remote work may be revoked
  • Return-to-office policies
  • Equipment return procedures

⚠️ Important: These agreements should be reviewed by employment counsel to ensure they do not create unintended contractual obligations or violate employment laws.

Source: Employment law best practices

Equipment and Expense Reimbursement

Federal Law

Under federal law (Fair Labor Standards Act), employers generally must reimburse employees for expenses that would cause the employee’s wages to fall below minimum wage.

What This Means: If an expense (e.g., internet, phone) is required for work and the employee must pay it, reimbursement may be required if not reimbursing would reduce effective wages below minimum wage.

Minnesota Law

Minnesota does not have a specific statute requiring reimbursement of business expenses for non-union employees.

However: According to general employment law principles:

  • Employers may not require employees to bear business expenses that reduce wages below minimum wage
  • Union contracts may include reimbursement provisions
  • Employer policies may create contractual obligations

Common Expenses for Remote Workers:

  • Internet service (business portion)
  • Phone service (business portion)
  • Office supplies
  • Workspace setup (desk, chair, etc.)
  • Mileage (if required to travel for work)

Best Practice: Develop clear written policies regarding:

  • What expenses will be reimbursed
  • Documentation requirements for reimbursement
  • Reimbursement process and timing
  • Business vs. personal use allocation

Source: Federal FLSA principles; Minnesota employment law; best practices

Workplace Safety

OSHA Obligations

The federal Occupational Safety and Health Act (OSHA) generally requires employers to provide a workplace “free from recognized hazards.”

Application to Remote Work:

According to OSHA guidance:

  • OSHA does not hold employers liable for home office conditions beyond employer’s control
  • Employers are responsible for hazards caused by materials, equipment, or work processes they provide or require
  • OSHA generally will not conduct inspections of home offices

What Employers Should Consider:

  • Providing ergonomic guidance for home workstations
  • Ensuring equipment provided is safe
  • Offering ergonomic assessments if requested
  • Training on proper setup and equipment use

Minnesota OSHA (MNOSHA)

Minnesota operates its own state OSHA program (MNOSHA) under the Minnesota Department of Labor and Industry.

Contact: 651-284-5050; https://www.dli.mn.gov/business/workplace-safety-and-health

Application: Similar principles to federal OSHA regarding remote work.

Source: Federal OSHA; Minnesota OSHA

Workers’ Compensation (Cross-Reference)

As discussed in Part 3, workers’ compensation coverage for remote workers involves fact-specific analysis of whether injuries “arise out of and in the course of employment.”

Key Points:

  • Remote workers are generally covered by workers’ compensation
  • Coverage depends on whether injury is work-related
  • Employers should have clear reporting procedures for remote workers
  • Consider workplace safety guidance for home offices

For detailed information, see Part 3: Workers’ Compensation Overview

Source: Minnesota Statutes Chapter 176; Part 3 of this guide

Multi-State Remote Work

Jurisdictional Considerations

When employees work remotely from states other than Minnesota, complex legal questions arise regarding which state’s laws apply.

General Principles:

Employment Laws: Generally, laws of the state where work is performed apply to that work. This includes:

  • Minimum wage
  • Overtime
  • Paid leave requirements
  • Anti-discrimination laws
  • Workers’ compensation

What This Means:

  • Employee working from California may be subject to California wage and hour laws
  • Employee working from Texas may be subject to Texas employment laws
  • Employer may need to comply with multiple states’ employment laws

Practical Implications:

For Employers:

  • May need to register in multiple states
  • May need multiple workers’ compensation policies
  • May need to comply with various leave laws (if more generous than Minnesota)
  • Payroll complexity increases
  • Potential nexus for tax purposes

Common Approaches:

Option 1: Limit Remote Work to Minnesota

  • Require employees to work from Minnesota locations
  • Simplifies compliance

Option 2: Limit to Specific Approved States

  • Choose states where employer will comply with employment laws
  • Document which states are approved
  • Require notice before relocating

Option 3: Allow Broad Remote Work with Legal Review

  • Evaluate each state’s requirements
  • Implement compliance programs for each state
  • Higher administrative burden but maximum flexibility

⚠️ Critical: Multi-state remote work requires legal analysis. Employers should consult counsel before allowing employees to work from other states.

Source: Multi-jurisdictional employment law principles

Immigration Considerations

Form I-9 Verification

Federal law requires employers to verify employee work authorization using Form I-9.

Remote Verification:

According to U.S. Citizenship and Immigration Services (USCIS):

  • Documents generally must be examined in person
  • During COVID-19, temporary flexibility was provided for remote verification
  • Employers should check current USCIS guidance regarding remote I-9 procedures

Contact: USCIS: https://www.uscis.gov/i-9

Note: This is a federal requirement, not a Minnesota-specific issue.

Source: Federal I-9 requirements; USCIS

Tax Implications (Preview)

Remote work can create complex tax obligations. For detailed information, see Part 5: Tax Information.

Brief Overview:

For Employers:

  • Withholding obligations may depend on where employee performs work
  • Potential nexus in other states
  • Unemployment insurance considerations

For Employees:

  • May owe income tax in state where work is performed
  • Potential for double taxation (credit may be available)
  • Residency vs. work location considerations

⚠️ Important: Tax matters require consultation with tax professionals. See Part 5 for more detailed information.

Source: Multi-state tax principles; preview for Part 5

Technology and Cybersecurity

Employer Responsibilities

Best Practices for Remote Work Technology:

Security Measures:

  • Virtual Private Network (VPN) for accessing company systems
  • Multi-factor authentication
  • Encryption for sensitive data
  • Regular software updates and patches
  • Endpoint protection (antivirus, anti-malware)

Policies:

  • Acceptable use policies for company equipment
  • Prohibition on unauthorized software installation
  • Requirements for securing physical workspace
  • Incident reporting procedures

Training:

  • Cybersecurity awareness training
  • Phishing awareness
  • Password hygiene
  • Data handling requirements

⚠️ Note: Data breaches involving employee or customer information may trigger notification obligations under Minnesota law (see Data Privacy section above).

Source: Cybersecurity best practices; Minnesota breach notification law

Right to Disconnect

Minnesota does not currently have a “right to disconnect” law that would prohibit employers from contacting employees outside work hours.

However:

Wage and Hour Implications: If non-exempt employees respond to communications outside work hours, that time may be compensable and count toward overtime.

Best Practice: Establish clear expectations regarding:

  • When employees are expected to be available
  • How after-hours communications should be handled
  • Whether after-hours work requires advance approval
  • How to report all time worked (including responding to emails/calls)

Emerging Issue: Some jurisdictions are considering “right to disconnect” legislation. Employers should monitor developments.

Source: General wage-hour principles; emerging legislative trends

Tax Information

Minnesota Income Tax Overview

Tax Structure

Statutory Authority: Minnesota Statutes Chapter 290
Administering Agency: Minnesota Department of Revenue

Contact Information:

  • Website: https://www.revenue.state.mn.us
  • Phone: 651-296-3781 (Twin Cities) or 1-800-652-9094 (toll-free)
  • Address: Minnesota Revenue, Mail Station 5510, 600 N. Robert St., St. Paul, MN 55146-5510

According to Minnesota Statutes Chapter 290, Minnesota imposes a progressive income tax on individuals with rates ranging from 5.35% to 9.85%.

Source: Minnesota Department of Revenue

2025 Tax Rates and Brackets

According to Minnesota Department of Revenue announcements, Minnesota’s individual income tax brackets are adjusted annually for inflation. For tax year 2025, the brackets increased by 2.886% from 2024.

Single Filers (2025 Tax Year):
Taxable Income Range Tax Rate
Up to $32,570 5.35%
$32,571 to $106,990 6.80%
$106,991 to $198,630 7.85%
Over $198,630 9.85%
Married Filing Jointly (2025 Tax Year):
Taxable Income Range Tax Rate
Up to $47,620 5.35%
$47,621 to $189,180 6.80%
$189,181 to $330,410 7.85%
Over $330,410 9.85%
Head of Household (2025 Tax Year):
Taxable Income Range Tax Rate
Up to $40,100 5.35%
$40,101 to $161,130 6.80%
$161,131 to $264,050 7.85%
Over $264,050 9.85%
Married Filing Separately (2025 Tax Year):
Taxable Income Range Tax Rate
Up to $23,810 5.35%
$23,811 to $94,590 6.80%
$94,591 to $165,205 7.85%
Over $165,205 9.85%

⚠️ Important: These are marginal tax rates. Under Minnesota’s progressive system, only income within each bracket is taxed at that bracket’s rate, not all income.

Additional Tax on Investment Income (Effective 2024): According to recent legislation, an additional 1% tax applies to net investment income over $1 million for individuals, estates, and trusts, bringing the top effective rate to 10.85% for such income.

Source: Minnesota Department of Revenue; Minn. Stat. § 290.06

Standard Deductions (2025 Tax Year)

According to Minnesota Department of Revenue announcements:

  • Single Filers: $14,950
  • Married Filing Jointly: $29,900
  • Married Filing Separately: $14,950
  • Head of Household: $22,500
  • Qualifying Widow(er): $29,900

Source: Minnesota Department of Revenue inflation adjustments for 2025

Withholding Tax for Employers

General Withholding Requirements

Statutory Authority: Minnesota Statutes § 290.92
Official Guidance: https://www.revenue.state.mn.us/withholding-tax

According to Minn. Stat. § 290.92, employers generally must withhold Minnesota income tax from wages paid to employees for services performed in Minnesota or to Minnesota residents.

Definition of “Employer”:

According to the statute, “employer” generally means any person transacting business in or deriving income from sources within Minnesota for whom an individual performs services as an employee.

Withholding Account Number:

According to the statute, employers desiring to engage in business in Minnesota must file an application for a withholding account number with the Minnesota Department of Revenue on or before the date they are required to withhold Minnesota taxes.

Application Process:

Employers apply through Minnesota e-Services: https://www.mndor.state.mn.us/tp/eservices/_/

Source: Minn. Stat. § 290.92; Minnesota Department of Revenue

Employee Withholding Forms

Federal Form W-4: All employees must complete federal Form W-4 for federal income tax withholding.

Minnesota Form W4-MN:

According to Minnesota Department of Revenue guidance, employees may need to provide Form W4-MN (Minnesota Withholding Allowance/Exemption Certificate) to their employer if:

  • They claim more than 10 Minnesota withholding allowances, OR
  • They checked Box A or B under Section 2 and expect wages to exceed $200 per week

⚠️ Note: Unlike the federal W-4 (which no longer uses allowances), Minnesota still uses an allowance-based system for state withholding.

Form W4-MN is optional if:

  • Employee only requests additional withholding (can use federal W-4)
  • Employee’s situation falls within standard parameters

Source: Minnesota Department of Revenue; Form W4-MN instructions

Supplemental Wage Withholding

According to Minnesota Department of Revenue guidance, supplemental wages (bonuses, commissions, severance pay, etc.) are generally subject to one of two withholding methods:

Method 1: Withhold at employee’s normal tax rate based on Form W4-MN

Method 2: Flat withholding rate of 6.25%

The method used may depend on how the employer disburses supplemental wages (separately identified vs. combined with regular wages).

Source: Minnesota Department of Revenue withholding guidance

Resident vs. Nonresident Taxation

Minnesota Residents Working in Minnesota

General Rule: Minnesota residents are subject to Minnesota income tax on all income, regardless of source. Employers must withhold Minnesota income tax from wages paid to Minnesota resident employees.

What This Means: If you live in Minnesota and work remotely from Minnesota for any employer (Minnesota-based or out-of-state), your wages are subject to Minnesota income tax.

Source: Minnesota Department of Revenue

Minnesota Residents Working Outside Minnesota

Statutory Guidance: https://www.revenue.state.mn.us/residents-working-outside-minnesota

According to Minnesota Department of Revenue guidance, if a Minnesota resident employee works physically in another state, the employer may need to withhold tax for:

  • Minnesota (because employee is a Minnesota resident), AND/OR
  • The work state (because work is performed there)

Withholding Calculation Method:

According to the Department’s guidance, if both states require withholding:

Step 1: Calculate Minnesota withholding as if all work was performed in Minnesota

Step 2: Calculate withholding for the work state

Step 3: Compare:

  • If Step 1 > Step 2: Withhold difference to Minnesota (in addition to work state withholding)
  • If Step 1 ≤ Step 2: Do not withhold Minnesota tax (only work state)

Example Scenario (Illustrative Only):

Disclaimer: This is a simplified illustration only, not a tax determination. Actual tax obligations depend on specific facts and both states’ laws. Consult tax professionals.

Minnesota resident works remotely from Wisconsin for Minnesota employer:

  • Minnesota withholding calculation: $500
  • Wisconsin withholding calculation: $400
  • Result: Employer withholds $400 to Wisconsin and $100 to Minnesota

Tax Credit: Minnesota residents generally receive a credit on their Minnesota tax return for income tax paid to other states, preventing double taxation.

⚠️ Reciprocity Agreements: Minnesota has income tax reciprocity agreements with Michigan and North Dakota. Special rules apply for residents of these states.

Source: Minnesota Department of Revenue; Minn. Stat. § 290.081 (credit for tax paid to other states)

Nonresidents Working in Minnesota

Statutory Guidance: https://www.revenue.state.mn.us/nonresidents-working-minnesota

According to Minnesota Department of Revenue guidance, nonresidents are subject to Minnesota income tax on wages earned from services performed in Minnesota.

Employer Withholding Obligation:

If an employer is required to withhold federal income tax from a nonresident employee’s wages for work performed in Minnesota, the employer generally must also withhold Minnesota income tax.

Exceptions:

According to Department guidance, withholding may not be required if the employee is a resident of:

  • Michigan (reciprocity agreement)
  • North Dakota (reciprocity agreement)

See Withholding Fact Sheet 20 for details.

What Constitutes “Performed in Minnesota”:

Wages are generally sourced to Minnesota based on where services are physically performed. Remote work from a Minnesota location generally constitutes work “performed in Minnesota” even if the employer is located elsewhere.

Source: Minnesota Department of Revenue; reciprocity agreements

Nexus Considerations for Out-of-State Employers

⚠️ Complex Area: Nexus (the connection that triggers tax obligations) is a complex legal and tax issue. Out-of-state employers should consult tax professionals before hiring Minnesota-based remote workers.

Employment Tax Nexus

According to Minnesota Department of Revenue and general principles, an out-of-state employer generally establishes employment tax nexus with Minnesota by having an employee physically working in Minnesota.

What This Means:

According to guidance and practice, even a single employee working remotely from their Minnesota home office may create nexus for the employer, requiring:

1. Income Tax Withholding:

  • Register for Minnesota withholding account
  • Withhold Minnesota income tax from Minnesota-based employees
  • File quarterly and annual withholding tax returns
  • Remit withheld taxes to Minnesota Department of Revenue

2. Unemployment Insurance:

  • Register with Minnesota Department of Employment and Economic Development (DEED)
  • Pay Minnesota unemployment insurance taxes
  • File quarterly wage reports
  • Contribute to Minnesota’s unemployment insurance fund

3. Workers’ Compensation:

  • Obtain Minnesota workers’ compensation coverage
  • Comply with Minnesota workers’ compensation reporting requirements

4. New Hire Reporting:

  • Report new Minnesota hires to Minnesota New Hire Reporting Center within 20 days
  • Address: P.O. Box 642126, Saint Paul, MN 55164-0212

Registration Process:

Out-of-state employers hiring Minnesota remote workers should:

  • Register with Minnesota Department of Revenue for withholding tax
  • Register with DEED for unemployment insurance
  • Obtain workers’ compensation coverage
  • Register with New Hire Reporting Center
  • Review Minnesota-specific employment law requirements

Contact Information:

  • Minnesota Department of Revenue: 651-296-3781 or 1-800-652-9094
  • DEED: 651-296-6141
  • Minnesota New Hire Reporting: 651-296-2535

Source: Minnesota nexus principles; Minnesota Department of Revenue; DEED

Corporate Income Tax Nexus

According to general nexus principles, having employees working in Minnesota may also create corporate income tax nexus for out-of-state businesses, potentially requiring:

  • Minnesota corporate income tax filing
  • Apportionment of income to Minnesota
  • Annual corporate tax returns

⚠️ Note: Corporate income tax nexus is distinct from employment tax nexus and involves separate analysis. Businesses should consult tax professionals.

Source: General corporate tax nexus principles

Sales Tax Nexus

According to Minnesota law, having employees in Minnesota may also trigger sales tax nexus if the business sells taxable goods or services.

Economic Nexus Thresholds: Minnesota requires remote sellers to collect sales tax if they:

  • Exceed $100,000 in gross sales to Minnesota customers in the preceding 12 months, OR
  • Conduct 200 or more separate transactions with Minnesota customers in the preceding 12 months

Physical Presence: Having employees in Minnesota creates physical presence nexus regardless of sales volume.

Source: Minnesota Department of Revenue sales tax guidance

Multi-State Tax Considerations

⚠️ Extremely Complex Area: Multi-state taxation is one of the most complex areas of tax law. Employers and employees in multi-state remote work situations should consult tax professionals with multi-state expertise.

General Principles

For Employees:

Resident State Taxation: According to general principles, employees generally owe income tax to their state of residence on all income, regardless of source.

Work State Taxation: Employees generally owe income tax to the state where they physically perform work (unless that state has no income tax or a reciprocity agreement).

Credit for Taxes Paid: Resident states typically provide a credit for income tax paid to other states to prevent double taxation.

What This Means:

Scenario (Illustrative Only):

  • Employee lives in Minnesota
  • Works remotely from Minnesota
  • Employer is in California

Result: Employee generally owes Minnesota income tax on all wages. California does not tax income for work not performed in California. Minnesota is the only state with taxing jurisdiction.

⚠️ Convenience of Employer Rules: Some states (Arkansas, Delaware, Nebraska, New York, Pennsylvania) have “convenience of employer” rules that may tax income of nonresidents working remotely from other states. These rules are controversial and complex.

For Employers

Withholding Obligations:

Employers generally must withhold income tax for the state where the employee physically performs work (and potentially the employee’s resident state if required).

Multi-State Compliance:

Employers with employees in multiple states face:

  • Multiple state registrations
  • Multiple withholding systems
  • Multiple quarterly and annual returns
  • Varying state employment laws
  • Complex payroll administration

Common Employer Approaches:

Approach 1: Limit Remote Work to Specific States

  • Pre-approve states where company will comply
  • Document approved states in policy
  • Require advance approval for relocations

Approach 2: Case-by-Case Analysis

  • Evaluate each state when employee requests remote work
  • Assess compliance burden vs. business need
  • Higher flexibility, higher administrative burden

Approach 3: Geo-Payroll Services

  • Use specialized payroll providers with multi-state expertise
  • Provider handles state-specific withholding and reporting
  • Reduces internal administrative burden

Source: Multi-state taxation principles; best practices

States Without Income Tax

The following states do not impose individual income tax (as of December 2025):

  • Alaska
  • Florida
  • Nevada
  • New Hampshire (taxes dividends and interest only)
  • South Dakota
  • Tennessee
  • Texas
  • Washington
  • Wyoming

Implication: Employees working from these states generally do not have state income tax withheld (except for dividend/interest in NH). Employers with nexus in these states still have unemployment insurance and other employment tax obligations.

Source: State tax authorities

Federal Tax Considerations (Brief Overview)

⚠️ Note: This guide focuses on Minnesota law. Federal tax is complex and requires separate professional guidance.

Federal Income Tax Withholding

All employers must withhold federal income tax according to:

  • Federal Form W-4
  • IRS Publication 15 (Circular E)
  • IRS withholding tables

FICA Taxes

Social Security Tax: 6.2% of wages up to $176,100 (2025 wage base)

  • Employer matches 6.2%
  • Maximum employee contribution: $10,918.20 (2025)

Medicare Tax: 1.45% of all wages

  • Employer matches 1.45%
  • Additional Medicare Tax: 0.9% on wages over $200,000 (employee-only, no employer match)

Federal Unemployment Tax (FUTA)

Employers pay federal unemployment tax on first $7,000 of each employee’s wages at 6.0% (with credit for state unemployment taxes, typically resulting in 0.6% effective rate).

Source: IRS; federal tax law

Tax Resources

Minnesota Department of Revenue

Website: https://www.revenue.state.mn.us Phone: 651-296-3781 (Twin Cities) or 1-800-652-9094 (toll-free)

Key Resources:

Minnesota Department of Employment and Economic Development (DEED)

Website: https://mn.gov/deed/ Phone: 651-296-6141

Unemployment Insurance Program:

IRS Resources

Website: https://www.irs.gov Business Tax Line: 1-800-829-4933

Key Resources:

  • Publication 15 (Circular E): Employer’s Tax Guide
  • Publication 15-A: Employer’s Supplemental Tax Guide
  • Form W-4: Employee’s Withholding Certificate
  • Form 941: Quarterly Federal Tax Return

Professional Assistance

Tax Professionals to Consult:

  • Certified Public Accountants (CPAs)
  • Enrolled Agents (EAs)
  • Tax Attorneys
  • Payroll Service Providers with multi-state expertise

When to Consult Professionals:

  • Multi-state remote work arrangements
  • Complex employee classification issues
  • Business nexus questions
  • Corporate tax implications
  • Significant tax liability concerns

Resources

Minnesota State Agencies

Minnesota Department of Labor and Industry (DLI)

Primary agency for workplace safety and labor standards

Website: https://www.dli.mn.gov
Phone: 651-284-5005 or 1-800-342-5354

Key Divisions:

Resources:

  • Employer fact sheets and guides
  • Online complaint filing
  • Educational seminars and webinars
  • Construction 14-factor test guidance

Minnesota Department of Human Rights (MDHR)

Primary agency for discrimination and civil rights enforcement

Website: https://mn.gov/mdhr
Phone: 651-539-1100 (Twin Cities) or 800-657-3704 (toll-free)
TTY: 711 or 800-627-3529
Email: Info.MDHR@state.mn.us

Address: Freeman Building, 625 Robert Street North, St. Paul, MN 55155

Services:

  • Charge intake and investigation
  • Mediation and alternative dispute resolution
  • Educational programs and training
  • Technical assistance for employers

Resources:

  • Your Civil Rights guide
  • Reasonable Accommodations guide
  • FAQs before filing charges
  • Discrimination Help Line

Minnesota Department of Revenue

Primary agency for tax administration

Website: https://www.revenue.state.mn.us
Phone: 651-296-3781 (Twin Cities) or 1-800-652-9094 (toll-free)

Address: 600 N. Robert St., St. Paul, MN 55146

Services:

  • Withholding tax registration and filing
  • Sales tax administration
  • Individual and corporate income tax
  • e-Services portal for online filing and payments

Resources:

  • Withholding Tax Instructions
  • Tax forms and publications
  • Educational webinars
  • Tax law updates

Minnesota Department of Employment and Economic Development (DEED)

Primary agency for unemployment insurance and workforce development

Website: https://mn.gov/deed
Phone: 651-296-6141

Unemployment Insurance Division:

Family and Medical Benefits Insurance Division (PFML):

  • Website: https://pl.mn.gov
  • Phone: 651-556-7777
  • PFML program (launching January 1, 2026)
  • Premium calculations and payments
  • Benefits administration

Resources:

  • Employer Handbook
  • Online registration and reporting system
  • Quarterly wage reporting tools
  • PFML implementation guides

Federal Agencies

U.S. Department of Labor (DOL)

Website: https://www.dol.gov
Phone: 1-866-4-USA-DOL (1-866-487-2365)

Wage and Hour Division:

  • FLSA enforcement
  • Minimum wage and overtime
  • Child labor laws
  • FMLA administration

OSHA:

  • Workplace safety standards
  • Inspections and enforcement
  • Safety training and resources

Minneapolis Office: Federal Building, 212 3rd Avenue South, Suite 200, Minneapolis, MN 55401

Equal Employment Opportunity Commission (EEOC)

Website: https://www.eeoc.gov
Phone: 1-800-669-4000
TTY: 1-800-669-6820

Minneapolis Office: 330 South Second Avenue, Suite 430, Minneapolis, MN 55401-2233 Phone: 612-335-4040 or 1-800-669-4000

Services:

  • Charge intake and investigation
  • Mediation services
  • Technical assistance
  • Training and outreach

Internal Revenue Service (IRS)

Website: https://www.irs.gov
Business Tax Line: 1-800-829-4933

Resources:

  • Publication 15 (Circular E): Employer’s Tax Guide
  • Form W-4 and withholding guidance
  • Federal tax forms and instructions
  • e-File for businesses

Local Ordinances and Resources

Minneapolis

City Website: https://www.minneapolismn.gov
Civil Rights Department: 612-673-3012

Key Ordinances:

  • Minimum wage (higher than state)
  • Sick and Safe Time (Minneapolis ESST)
  • Wage theft prevention

Resources: City ordinances and compliance guides available on city website

St. Paul

City Website: https://www.stpaul.gov
Human Rights & Equal Economic Opportunity Department: 651-266-8900

Key Ordinances:

  • Minimum wage (tiered by employer size)
  • Earned Sick and Safe Time (St. Paul ESST)

Resources: City ordinances and employer guides available on city website

Bloomington

City Website: https://www.bloomingtonmn.gov

Key Ordinances:

  • Earned Sick and Safe Time (Bloomington ESST)

Resources: City ordinances available on city website

Professional Organizations and Resources

Minnesota Chamber of Commerce

Website: https://www.mnchamber.com
Phone: 651-292-4650

Services:

  • Employment law updates
  • HR support services
  • Policy advocacy
  • Educational programs

Employers Association

Website: https://www.employerschamber.org
Phone: 952-933-4422

Services:

  • HR consulting
  • Legal hotline
  • Wage and salary surveys
  • Training and seminars

Society for Human Resource Management (SHRM) – Minnesota

Website: https://www.shrm.org/communities/local-chapters/minnesota

Resources:

  • HR professional development
  • Networking opportunities
  • Compliance updates
  • Best practices

Recommended Reading and Guides

Minnesota Department of Labor and Industry:

  • “Minnesota Labor Law Posters” (required workplace postings)
  • “Construction Industry 14-Factor Test” guide
  • “Workers’ Compensation for Employers” handbook

Minnesota Department of Human Rights:

  • “Your Civil Rights in Minnesota” guide
  • “Reasonable Accommodations” guide
  • “Pregnancy Accommodations” fact sheet

Minnesota Department of Revenue:

  • “Withholding Tax Instructions”
  • “Minnesota Tax Handbook”
  • “New Business Tax Information”

U.S. Department of Labor:

  • “Employment Law Guide”
  • “FLSA Coverage” fact sheets
  • “FMLA Employer Guide”

Frequently Asked Questions

Employee Classification

Q1: How do I determine if a worker is an employee or independent contractor in Minnesota?

According to Minnesota law, classification may depend on the context:

  • For unemployment insurance purposes: The ABC test (Minn. Stat. § 268.035) is generally used, requiring all three factors to classify as independent contractor
  • For workers’ compensation: A 5-factor test is commonly used
  • For construction industry: A 14-factor test applies (effective March 1, 2025) under Minn. Stat. § 181.723
  • For federal tax purposes: IRS common law test applies

⚠️ Critical: Misclassification can result in significant penalties. Each test has different criteria. A worker classified as an independent contractor under one test may be an employee under another. Consult legal and tax professionals for classification determinations.

Q2: What are the consequences of misclassifying an employee as an independent contractor?

According to Minnesota law and federal law, consequences may include:

  • Back taxes and withholding obligations
  • Unpaid unemployment insurance contributions
  • Workers’ compensation coverage violations and penalties
  • Wage and hour violations (unpaid overtime, benefits, etc.)
  • Civil penalties under Minn. Stat. § 181.723 (up to $10,000 per violation in construction)
  • Stop work orders
  • Individual liability for company owners/officers (in construction)
  • IRS penalties and interest

Consult legal counsel regarding classification compliance.

Minimum Wage and Overtime

Q3: What is the minimum wage in Minnesota for 2026?

According to Minnesota DLI, the 2026 rates are:

State Minimum Wage:

  • Large employers (annual gross sales $500,000+): $11.41/hour
  • Small employers (annual gross sales under $500,000): $9.33/hour
  • Training wage (first 90 days, under 20 years old): $9.33/hour

Minneapolis (effective July 1, 2026): $16.37/hour (projected) St. Paul (effective July 1, 2026): Varies by employer size

See Part 2 for complete details and sources.

Q4: Does Minnesota require overtime pay?

Generally, yes, but it depends on the law that applies:

  • Federal FLSA: Overtime (1.5x regular rate) required after 40 hours/week for non-exempt employees
  • Minnesota law: Overtime required after 48 hours/week for employees not covered by FLSA

Most employees are covered by FLSA, which has the more generous 40-hour threshold.

Exemptions: Executive, administrative, professional, computer professional, and certain other employees may be exempt if they meet salary and duties tests.

Consult wage and hour professionals for specific situations.

Q5: Do remote workers get overtime?

According to general employment law principles, remote workers are entitled to overtime if they are non-exempt employees, just like on-site workers.

Critical employer obligation: Track all hours worked by non-exempt remote employees, including time responding to emails and messages outside regular hours.

Best practice: Establish clear policies about when remote employees should work and how to report all time.

Breaks and Meal Periods

Q6: What break requirements apply in Minnesota?

⚠️ CRITICAL: New Requirements Effective January 1, 2026

According to Minn. Stat. § 177.253 (as amended 2025):

Rest Breaks: Minimum 15 minutes for every 4 consecutive hours worked (paid break)

Meal Breaks: Minimum 30 minutes after working 6 hours (unpaid if employee is completely relieved of duties)

Breast Milk Expression: Reasonable break time and private space (not bathroom) for expressing breast milk

Previous Law: Rest breaks were “adequate time,” meal breaks after 8 hours. The 2026 amendments significantly strengthen these requirements.

See Part 2 for complete details.

Leave Entitlements

Q7: What paid leave is available to Minnesota employees?

According to Minnesota law (as of December 2025):

Earned Sick and Safe Time (ESST):

  • Applies to all employers
  • Employees accrue 1 hour per 30 hours worked (48-hour annual cap)
  • Use for sick time, safe time, weather/emergency, bereavement
  • See Part 3 for complete details

Paid Family and Medical Leave (PFML) – Starting January 1, 2026:

  • Up to 12 weeks medical leave per year
  • Up to 12 weeks family leave per year
  • Maximum 20 weeks combined
  • 55%-90% wage replacement
  • All employers covered
  • See Part 3 for complete details

Bone Marrow/Organ Donation:

  • 40 hours PAID leave per donation (employers with 20+ employees)

No Mandatory Paid Vacation or Holidays: Minnesota does not require employers to provide paid vacation or paid holidays.

Q8: What unpaid leave is available?

According to Minnesota law:

Pregnancy and Parenting Leave:

  • 12 weeks unpaid leave
  • All employers (no size minimum)
  • Immediate eligibility
  • See Part 3

Federal FMLA (employers with 50+ employees):

  • 12 weeks unpaid leave per year
  • For serious health conditions, family care, military family leave
  • Employee must meet eligibility requirements (12 months tenure, 1,250 hours)

School Conference and Activities Leave: Use of existing paid leave for children’s school activities

Sick Leave for Family Care: Use sick leave to care for sick children

Anti-Discrimination

Q9: What are the protected classes under Minnesota law?

According to Minnesota Human Rights Act (Minn. Stat. Chapter 363A), the 13 protected classes are:

  1. Race
  2. Color
  3. Creed
  4. Religion
  5. National Origin
  6. Sex (including pregnancy)
  7. Gender Identity
  8. Marital Status
  9. Familial Status
  10. Disability
  11. Status with Regard to Public Assistance
  12. Sexual Orientation
  13. Age (18+)

⚠️ 2024 Amendments: Significantly expanded protections and remedies. See Part 4.

Q10: How do I file a discrimination complaint?

Minnesota Department of Human Rights:

EEOC (for federal claims):

See Part 4 for complete filing process.

Remote Work Arrangements

Q11: Must employers allow remote work?

Generally, no. According to general employment law principles, employers are generally not required to allow remote work unless:

  • Remote work is a reasonable accommodation for a disability, OR
  • Required by contract or policy, OR
  • Required by specific law (none currently in Minnesota requiring remote work generally)

However: Employers should consider remote work as a potential reasonable accommodation when employees with disabilities request it.

Q12: Can employers require employees to return to the office?

Generally, yes, unless:

  • Contractual obligations limit employer’s discretion
  • Employee has legal right to accommodation (disability)
  • Collective bargaining agreement provides otherwise

Best practice: Provide reasonable notice of return-to-office requirements and consider accommodation requests.

Q13: Must employers reimburse remote workers for expenses?

Minnesota Law: No specific statute requires reimbursement for remote work expenses for non-union employees.

Federal FLSA: Employers may not require employees to bear expenses that would reduce effective wages below minimum wage.

Best Practice: Develop clear written policies regarding what expenses will be reimbursed (internet, phone, equipment, etc.).

Consult employment counsel for policy development.

Workers’ Compensation

Q14: Are remote workers covered by workers’ compensation?

Generally, yes. According to Minnesota Statutes Chapter 176, workers’ compensation coverage generally applies to injuries that “arise out of and in the course of employment.”

Key Question: Was the injury work-related?

Factors considered:

  • Nature of activity when injured
  • Location (home office vs. other areas)
  • Timing (during work hours vs. personal time)
  • Employer control/direction
  • Benefit to employer

⚠️ Fact-Specific: Every case depends on specific circumstances. See Part 3 for detailed discussion and illustrative scenarios (not determinations).

Q15: What should employers do about workers’ compensation for remote workers?

Best practices:

  • Obtain adequate workers’ compensation coverage
  • Establish clear reporting procedures for remote workers
  • Provide workplace safety guidance for home offices
  • Document remote work arrangements
  • Respond promptly to injury reports
  • Consult workers’ compensation insurance carrier

See Part 3 for more details.

Tax Issues

Q16: Where do remote workers pay income tax?

According to general principles:

Employee’s Resident State: Taxes all income regardless of source

Work State: Taxes income for work performed in that state

Credit: Resident state typically provides credit for taxes paid to other states

Example:

  • Live in Minnesota, work remotely from Minnesota for California employer
  • Pay Minnesota income tax only (work performed in Minnesota)
  • California has no taxing jurisdiction

⚠️ Complex: Multi-state situations require tax professional guidance.

Q17: What if my employee moves to another state?

Tax Implications:

  • May trigger nexus in new state for employer
  • May require withholding in new state
  • May require unemployment insurance registration in new state
  • May require workers’ compensation in new state

Employment Law Implications:

  • New state’s employment laws may apply
  • Minimum wage, overtime, leave laws may differ
  • Compliance obligations increase

Best Practice: Establish policies requiring advance approval for out-of-state moves. Consult legal and tax professionals before approving.

Q18: What is “nexus” and why does it matter?

Nexus = Connection to a state that triggers tax and legal obligations

Created by:

  • Having employees in a state
  • Having physical presence (office, warehouse)
  • Exceeding economic thresholds (for sales tax)

Triggers:

  • Income tax withholding requirements
  • Unemployment insurance obligations
  • Workers’ compensation requirements
  • Potential corporate income tax filing
  • Potential sales tax collection

⚠️ Significant: Nexus can create unexpected obligations. Consult tax professionals before hiring employees in new states.

Data Privacy

Q19: Can employers monitor remote workers?

According to general principles and Minnesota law:

Generally permissible with proper notice:

  • Monitoring company devices and systems
  • Tracking productivity on company equipment
  • Recording business communications
  • GPS tracking on company vehicles during work hours

Best practices:

  • Provide clear written policies
  • Obtain employee acknowledgment
  • Limit monitoring to work-related activities
  • Avoid monitoring during non-work hours
  • Protect monitored data appropriately

Privacy concerns:

  • Home monitoring (video) requires careful consideration
  • Personal device monitoring raises additional issues
  • Social media privacy protections exist (Minn. Stat. § 181.983)

Consult employment and privacy counsel before implementing monitoring programs.

Q20: What is the Minnesota Consumer Data Privacy Act?

MNCDPA = Minnesota’s comprehensive data privacy law

Effective Date: July 31, 2025

⚠️ Important Limitation: The MNCDPA generally does NOT apply to employee data (employment context is excluded from “consumer” definition)

However: Employers should be aware as it may affect:

  • Job applicant data before they become applicants
  • Contractor and vendor relationships
  • Business operations generally

See Part 4 for details.

Compliance and Enforcement

Q21: What are the penalties for violating Minnesota employment laws?

Penalties vary by violation:

Wage and Hour Violations:

  • Back wages owed
  • Liquidated damages (typically equal to unpaid wages)
  • Civil penalties
  • Attorney’s fees

ESST Violations:

  • Liquidated damages equal to hours owed (2025 amendment)
  • Civil penalties
  • Attorney’s fees

Construction Misclassification:

  • Up to $10,000 per violation
  • Stop work orders
  • Individual liability for owners/officers

Workers’ Compensation Violations:

  • Penalties for failure to carry coverage
  • Stop work orders

Discrimination Violations (2024 amendments):

  • Compensatory damages (up to 3x actual damages)
  • Punitive damages
  • Civil penalties
  • Attorney’s fees

Consult legal counsel to ensure compliance.

Q22: How can employers stay compliant?

Best practices:

1. Develop Clear Policies:

  • Written employee handbook
  • Remote work policies
  • Anti-discrimination and anti-harassment policies
  • Leave policies
  • Expense reimbursement policies
  • Data privacy and monitoring policies

2. Train Managers:

  • Employment law basics
  • Discrimination and harassment prevention
  • Leave administration
  • Wage and hour compliance
  • Documentation requirements

3. Maintain Accurate Records:

  • Time records for all non-exempt employees
  • Leave accruals and usage
  • Pay rates and changes
  • Performance documentation
  • Accommodation requests and responses

4. Conduct Regular Audits:

  • Wage and hour practices
  • Classification decisions
  • Leave administration
  • Policy compliance

5. Consult Professionals:

  • Employment attorneys for legal compliance
  • CPAs or tax professionals for tax matters
  • HR consultants for policy development
  • Insurance brokers for coverage adequacy

6. Monitor Legal Updates:

  • Subscribe to Minnesota DLI updates
  • Follow Minnesota Department of Revenue
  • Monitor MDHR announcements
  • Track local ordinance changes

Q23: Where can I get help?

Legal Questions:

  • Employment attorney
  • Minnesota Department of Labor and Industry: 651-284-5005
  • Minnesota Department of Human Rights: 651-539-1100

Tax Questions:

  • CPA, Enrolled Agent, or Tax Attorney
  • Minnesota Department of Revenue: 651-296-3781
  • IRS: 1-800-829-4933

HR and Policy Questions:

  • HR consultant
  • Professional employer organization (PEO)
  • Minnesota Chamber of Commerce: 651-292-4650
  • Employers Association: 952-933-4422

Workers’ Compensation:

  • Workers’ comp insurance carrier
  • Minnesota DLI Workers’ Compensation Division: 651-284-5005

Unemployment Insurance:

  • Minnesota DEED: 651-296-6141

Q24: What workplace posters are required in Minnesota?

Minnesota requires several workplace postings. According to Minnesota DLI, required posters include:

  • Minnesota Minimum Wage
  • Unemployment Insurance Notice
  • Workers’ Compensation Notice
  • Safety and Health Protection on the Job (OSHA)
  • ESST (if applicable)
  • Various federal posters (FLSA, FMLA, EEO, etc.)

Where to obtain:

Remote Workers: Employers should provide required posters electronically or via mail to remote workers.

Q25: What should be included in a remote work agreement?

Suggested components (consult legal counsel):

Work Location:

  • Specific address or general location
  • Approval process for changes
  • Multi-state work restrictions

Schedule and Availability:

  • Expected work hours
  • Availability requirements
  • Time zone considerations

Equipment and Expenses:

  • Equipment provided by employer
  • Reimbursement policies
  • Maintenance and return procedures

Performance Expectations:

  • Communication requirements
  • Productivity standards
  • Meeting attendance

Workspace Requirements:

  • Safety expectations
  • Privacy considerations
  • Ergonomic recommendations

Technology and Security:

  • Acceptable use policies
  • Data security requirements
  • VPN and password requirements

Modification and Termination:

  • Circumstances for revoking remote work
  • Return-to-office procedures
  • Notice requirements

Compliance:

  • Statement that all company policies apply
  • Reference to handbook
  • Agreement to report all hours worked

Consult employment attorney for agreement drafting.

Others

Wisconsin
Iowa
North Dakota
South Dakota
Illinois

Legal Disclaimer: This guide provides general background information only and does not constitute legal, tax, or professional advice. Employment laws are complex and subject to interpretation. Consult licensed legal counsel and official state agencies for guidance specific to your situation.