Minnesota Paid Leave Is Coming: Is Your Workplace Ready?

Minnesota’s Paid Leave Law (Paid Leave), enacted in 2023 and updated in 2024, will provide paid leave benefits and job protections to most Minnesota employees for certain family, medical, safety and military-related needs starting January 1, 2026 — less than three short months away.

Minnesota employers must take a number of steps now and in the coming months to comply with new Paid Leave requirements. Here is a summary of key steps that employers should begin taking as soon as possible, if they have not already:

• Decide whether to participate in the state-administered Paid Leave program or to provide employees with an equivalent plan that meets or exceeds state requirements.

Equivalent plans may be self-insured or obtained through a private insurance carrier approved by the state. Employers who wish to offer an equivalent plan must request an Equivalent Plan Substitution from the state. While employers can submit a request for an Equivalent Plan Substitution at any time, equivalent plans can take effect only at the start of a calendar quarter. The state is asking employers who wish to have an equivalent plan in place by January 1, 2026, to submit their request no later than November 10, 2025 — so employers must make this decision as soon as possible.

• Decide how to split premiums.

In 2026, Paid Leave premiums are set at 0.88% of wages (up to the OASDI limit) for most employers participating in the state-administered program. Employers must cover at least half of the premiums (0.44% for 2026) and can deduct the remainder from covered employees’ pay — but employers can choose to cover more. Small employers, as defined in the Paid Leave Law, qualify for a reduced premium rate.

Employers that provide an equivalent plan cannot require employees to contribute more than they would owe under the state-administered program. Employers must remember that premium deductions cannot cause an employee’s pay to drop below the applicable minimum wage.

• Designate one or more Paid Leave Administrators.

Employers must designate at least one or more Paid Leave Administrators, who serve as the main point of contact for Paid Leave. For employers participating in the state-administered program, Paid Leave Administrators review leave applications for accuracy and view Paid Leave determinations from the state.

Employers designate their Paid Leave Administrator(s) in their Joint Unemployment Insurance-Paid Leave Employer Account and then set up a separate Paid Leave Administrator Account here.

• Review and update workplace policies and procedures.

Employers should implement a Minnesota Paid Leave policy. The policy should address, among other matters, employee notification requirements, limitations on intermittent leave as allowed by the Paid Leave Law, and whether the employer will allow employees to supplement their Paid Leave benefits with employer-provided salary continuation, vacation, sick leave, or other paid time off benefits. Employers should review other policies, including FMLA, Minnesota Pregnancy and Parenting Leave, and ESST and other paid or unpaid time off policies, and update the policies as needed to ensure coordination and compliance with Paid Leave. Employers should also review short-term disability and similar benefit program in light of their overall total rewards strategy and to ensure overpayments are not made.

Because the benefit year for employers participating in the state-administered Paid Leave program is measured as the 52-week period that begins on the effective date of leave, employers that use a different method for determining the 12-month period in which an employee’s 12 weeks of FMLA entitlement occur may wish to change their FMLA measurement method to align with the Paid Leave benefit year. Keep in mind, however, that employers must provide employees with at least 60 days’ notice before changing the method by which they calculate FMLA entitlements and, during the 60-day notice period, must use the method that provides the greatest benefit to the employee. Employers providing Paid Leave benefits through an equivalent plan can choose a Paid Leave benefit year that aligns with their FMLA measurement period.  

• Comply with notification requirements.

Employers have certain notification requirements which must be met by December 1, 2025:

1. Employers must post a Paid Leave poster in English and any other language that is the primary language of five or more employees or independent contractors of that workplace (as long as the state has made the poster available in such language).
2. Employers also must provide a notice to each employee containing certain information specified in the Paid Leave Law, and the notice must be provided in the employee’s primary language. Employers must obtain written or electronic acknowledgment of receipt from the employees. New hires after December 1^st must receive the individual notice within 30 days of hire.

English-language versions of the workplace poster and a sample notice to employees are available now on the state’s Paid Leave website: Employers: Prepare for Paid Leave Today/Minnesota Paid Leave.

Please reach out to your Fredrikson Employment, Labor & Benefits attorney with any questions you have about Minnesota Paid Leave or for assistance with policy updates, implementing an equivalent plan, integrating Paid Leave with other policies and programs, or other compliance measures.