On May 25, 2023, Governor Walz signed the Minnesota Paid Family Medical Leave Act into law. The Minnesota Department of Labor and Industry (the “Department”) is now referring to the new law as “Minnesota Paid Leave” or simply “Paid Leave.” As a reminder, this is completely separate from the Minnesota Earned Sick and Safe Time law, which is commonly referred to as ESST, ESSL, or paid sick leave. The Minnesota Earned Sick and Safe Time law currently requires employers to allow employees to earn paid time off for covered purposes related to illness and safety. In contrast, Minnesota Paid Leave is a paid benefit, administered by the Department, that will provide eligible employees up to a certain amount of wage replacement and job protection if they experience a qualifying event.

The Department recently launched the Minnesota Paid Leave website and issued an update detailing the upcoming employer wage submission and providing answers to the top three questions the Department is receiving.

The update explains that the Department is planning to build a submission system aligned with the Minnesota Unemployment Insurance program’s system to minimize the administrative complexity. Under the planned process, employers would use the same system and account. In addition, wage report submissions would only be required once per quarter.

Under the new law, employees are not eligible to take Minnesota Paid Leave until Jan. 1, 2026. However, the Department is already fielding questions related to eligibility and the use of time. The top questions and answers from the Department’s January update are as follows:

1. If I have a child in 2025, will I be able to take leave in 2026?

Under the program, an individual is eligible to take bonding leave within 52 weeks from the date of welcoming a new child into their family through birth, adoption, or foster care. Parents who welcome children in 2025 will be eligible to take leave to bond with their child in 2026 as long as the leave is complete within that first year.

2. If I work in Minnesota, but live in a different state – will I be covered?

Eligibility for employees who work and live in different states depends on where their work is localized. If work is performed entirely within the state of Minnesota, those individuals are covered. In scenarios where an employee performs services in multiple states, it depends on where most of the work is completed.

3. If I work for an employer that doesn’t participate in the unemployment insurance program, will I be covered under the Paid Leave program?

The Paid Leave program is a new program distinct from the Unemployment Insurance program. The Paid Leave law does not exclude the same entities that are excluded for the purposes of Unemployment Insurance. This means that agricultural businesses, religious organizations, and other entities that are not required to participate in the unemployment insurance program are required to participate in the Paid Leave program.

Although the Department website still states that employers will begin submitting wage reports to the Department in mid-2024, the Jan. 17, 2024, update stated that these submissions would begin in late 2024. We recommend employers monitor the Department’s Paid Leave website for clarity and deadlines related to the required submissions. Taft’s Employment and Labor Relations practice group will continue to stay current with the Department’s updated guidance. Please feel free to reach out to a Minneapolis Employment and Labor Relations attorney for any questions related to Minnesota Paid Leave.