Currently, Minnesota employers are not required to pay employees for sick time or other forms of paid leave. However, new legislation has been approved, requiring employers to pay employees for earned sick time. The new law takes effect January 1, 2024.
Although there are no current Minnesota PTO laws, the state does have laws requiring employers to allow employees to use sick time for specific reasons, even if that time is not paid. Additionally, Minnesota employers must comply with the Family and Medical Leave Act (FMLA), which provides most workers with up to 12 weeks of unpaid leave to care for a newborn or adopted child or care for themselves or a close relative.
This guide compares the upcoming Minnesota PTO laws with current laws to help businesses know what to expect come January when the law goes into effect.
Current Minnesota Paid Leave Laws
Like all states, Minnesota follows federal FMLA laws, allowing workers to take leave from work for medical and family reasons without repercussions from an employer. For example, if an employee has an ill child to care for or has to undergo several upcoming medical tests or treatments, that employee can take off up to 12 weeks in a 12-month period without getting fired, receiving reduced hours, or facing other consequences.
Employees using the time to care for a covered servicemember can receive up to 26 weeks of unpaid leave rather than 12 weeks. Any employees using their FMLA coverage can also continue to receive group health insurance they currently have through their employer throughout their time off.
In addition to FMLA coverage, Minnesota employees are also eligible for safety coverage under Minnesota law, as defined by Section 181.9413 of the Minnesota Statutes.
This section states that employees can use their sick leave benefits to care for themselves or a close relative for “reasonable periods of time.” Additionally, the employee is entitled to take time off without repercussion for issues related to safety, including sexual assault, harassment, and domestic violence.
Minnesota employers can limit the personal and sick leave employees receive, but they must offer at least 160 hours in a 12-month period.
Remember that these current Minnesota laws do not restrict employers from providing more sick and safety leave benefits if they choose. Rather, employers can offer longer covered absences to employees or provide paid sick and safety leave. Any paid leave an employer decides to grant employees should be written clearly in the company’s PTO policy.
New Minnesota PTO Laws
The new Minnesota PTO laws govern the amount of paid sick time a covered employee is entitled to. Covered employees are anyone who works at least 80 hours in a year for the employer as an employee rather than an independent contractor.
The law names several reasons an employee may use their paid sick time, including addressing the employee’s mental or physical health needs, caring for a family member with mental or physical health needs, or addressing safety concerns, as noted above.
Additionally, the new law allows employees to use their sick time if the workplace closes due to an emergency, like a weather event, or a family member’s school or daycare closes due to an emergency. Minnesota defines family member in several ways, including an employee’s child, spouse, sibling, nephew or niece, parent, or grandparent.
Minnesota Accrual Requirements
Under the new law, Minnesota employees accrue one hour of sick and safe time for every 30 hours they work. So, an employee who typically works 30 hours a week should accrue at least four hours of paid sick time each month. Salaried employees who typically work 40 or more hours a week should have sick time accrue based on working 40 hours every week.
Under the law, as defined in section 181.9446 of the revised Minnesota Statutes, employees can earn up to 48 hours of sick and safe time annually. However, employers can offer more than this amount if they choose.
Employees begin earning their sick time once they begin working, and they can begin using their sick time as soon as they earn it.
Rather than allow sick time to accrue throughout the year, employers are also permitted to give employees a lump sum of sick time at the beginning of the year. The employer must provide either a minimum of 48 or 80 hours. I’ll get more detailed on this in the sections below.
Minnesota Roll Over Requirements
Minnesota employees can roll over their unused sick time into the next year. However, employees can only have up to 80 hours of sick time in their bank if the employer aligns with the law. Again, employers can choose to allow employees to hold more than this amount.
This requirement is only applicable to employees who receive accrued sick time hours throughout the year rather than a lump sum payment from their employer.
Minnesota PTO Payout Requirements
Minnesota employers do not have to pay out unused sick time at the end of the year if their employees earn sick and safe time through an accrual system. Instead, employees can roll over their unused time, as noted in the previous section.
This may differ when an employer uses a lump sum payment system instead. Employers offering 80 hours of sick time at the beginning of the year are not subject to unused PTO payout at the end of the year. However, those choosing the 48-hour lump sum payment are required to pay for unused sick time at the end of the year.
This sick time gets paid at the employee’s regular hourly rate.
Also, employers are not required to pay an employee unused sick time they’ve earned if they are terminated or separated from the company. However, transferring to another department at the same company still gives that employee the right to keep and continue accruing their earned sick and safe time.
Additional Minnesota PTO Law Information for Employers
The above information gives all the important details about how the new Minnesota PTO laws will work for earned sick time beginning in January 2024. However, there are a few additional parts of the new law that employers should be aware of.
First, some local ordinances in Minnesota already have paid sick time in place, including in St. Paul and Minneapolis. For example, Minneapolis law states that employers with six or more employees must provide those employees with sick and safe time.
If your company falls under the jurisdiction of a sick and safe time ordinance, it should align its earned sick time policy with whatever regulations are more restrictive between the local ordinance and the new state law to remain compliant in either case.
Another note: Employers in Minnesota will be responsible for notifying their employees of the new earned sick and safe time law, either before the law goes into place or at the employee’s start of employment. Information about the law should also be included in the employer’s handbook if one exists.
Most importantly, employers are required to include each employee’s earned and used sick and safe time on each earnings statement every pay period.
The Future of PTO in Minnesota
With new Minnesota PTO laws entering the workplace in 2024, it’s possible that state employees begin seeing more generous PTO policies in place. The state is also enacting a new paid family leave law, set to begin in 2026. Because employers must comply with the law and meet specific minimums, some companies might err on the side of caution by increasing accruals and maximum PTO banks to offer more than the law requires.
Learn more about Minnesota’s Earned Sick and Safe Time from the Department of Labor and Industry. Company owners should be sure to have a Minnesota labor attorney review their current or new PTO policies to ensure that they meet the minimum requirements of the new law.
