On May 16, 2023, the Minnesota State Legislature passed a package of jobs and labor legislation that included a statewide earned sick and safe time (ESST) requirement. The legislation, which is expected to be signed by Minnesota Governor Tim Walz, would require employers to begin providing ESST effective January 1, 2024.

Coverage

• The ESST law broadly defines “employer” to include almost any entity that has one or more employees.
• Employees are covered under the ESST law if they work for their employer for at least 80 hours in a year.
• Temporary and part-time employees are included, but independent contractors as well as employees in certain industries (e.g., airlines) are excluded from coverage under the law.
• Employers with time off policies that are equally or more generous than the ESST law are not required to provide additional ESST.
• The ESST law does not apply to employees working under a collective bargaining agreement (CBA) with a bona fide building and construction trades labor organization. It does apply to any other employees working under a CBA unless the CBA meets or exceeds, and does not conflict with, the law’s requirements.

Accrual and Carryover

• ESST will accrue at a rate of 1 hour per 30 hours worked, up to a maximum of 48 hours per year and 80 hours “point-in-time” accrual cap. The law does not specify a maximum number of hours of ESST employees can use in a year.
• Accrual will begin on the later of January 1, 2024 or commencement of employment.
• There is no waiting period for employees to access their ESST benefits. Benefits may be used as soon as they accrue.
• Employers appear to have two options to avoid year-end ESST carryover:
  • Frontload 48 hours of ESST for immediate use at the start of each year, with a payout of each employee’s balance of earned, unused ESST from the previous year; or
  • Frontload 80 hours of ESST for immediate use at the start of each year (the law is not completely clear, but suggests that no payout of the previous year’s unused ESST is required with this option)
• Employers are not required to pay out accrued, unused ESST upon termination from employment, but must reinstate previously accrued, unused ESST if a terminated employee is rehired within 180 days.

Reasons for Use, Increments, and Pay

• Employees may use ESST for the following reasons:
  • Employee’s or family member’s illness, treatment, or preventive care
  • Specified reasons related to domestic abuse, sexual assault, or stalking of employee or family member
  • Closure of employee’s workplace for weather or other public emergency; or, employee’s need to care for a family member due to closure of the family member’s school or place of care due to weather or other public emergency
  • Specified reasons related to a public health emergency (e.g., employee is diagnosed with a communicable disease that is a public health concern)
  • Official health authority order of quarantine or isolation
• The law broadly defines “family member” to include virtually anyone with whom the employee has a family bond or family-like relationship, including the ability for employees to annually designate one individual who does not otherwise fall under the “family member” definition.
• The maximum increment for ESST use is four hours, although employers may allow ESST use in increments down to the smallest time periods tracked by their payroll systems.
• ESST must be paid at employees’ normal rate of pay, but may not be paid at rates less than the applicable state or local minimum wage.

Notice and Documentation

• Employers may require up to seven days’ notice when the need for ESST is foreseeable, or as soon as practicable in the case of an unforeseeable need for leave.
• If notice of ESST use is required, an employer’s written policies must include reasonable procedures for employees to provide notice. Employees must be provided with a written copy of the leave notice policy.
• When more than three consecutive days of ESST are used, employers may require reasonable documentation that leave was used for a covered reason.
• The ESST law includes a mandate for employers to provide notice of employees’ rights under the law, in English and in the primary language spoken by the employee; such notice must be provided by January 1, 2024 or at commencement of employment, whichever is later.
• Notice may be provided by
  • prominently posting a copy of the notice at each work location
  • providing the notice individually to employees via paper or electronic communication
  • posting the notice in a conspicuous place on a web- or app-based platform used by employees to perform work
• Employers must include notice of ESST rights in any handbook they provide to employees.
• The state’s Department of Labor and Industry will provide employers with a model notice for meeting the ESST law’s notice and posting requirements.
• Employers must provide employees with an accounting of ESST hours accrued and used at the end of each pay period. The law also includes a requirement for employers to retain records, for at least three years in addition to the current calendar year, of hours worked and ESST used by employees.