If you’ve read my recent blog about the new paid sick and safe time (required January 1, 2024), you may be wondering how that affects your business if you are a federal contractor. You are right – you are special! Under the federal contractor requirements established pursuant to Executive Order 13706, you must provide the following:

Accrual method

  • 1 hour of PTO for every 30 hours worked (same as state).
  • Earning cap minimum: 56 hours of PTO per year.
  • Carryover to next year: Yes, but may limit PTO banking to 56 hours.

Frontloading method

  • 56 hours of PTO at the beginning of every year.
  • Carryover to next year: Yes, may limit PTO banking to 112 hours.


  • Employees who work on or in connection with a covered federal contract (see below), and their wages under the contract are governed by the DBA, SCA, or FLSA.
  • Employees who perform work in connection with covered federal contracts but less than 20% of their work hours in a given workweek are exempt from this regulation.

What Are Covered Federal Contracts (Awarded on or after January 1, 2017)?

  1. Procurement contracts for services or construction covered by the Davis Bacon Act
  2. Contracts for services covered by the Service Contract Act
  3. Concessions contracts
  4. Contracts related to federal property or lands offering services for federal employees, their dependents, or the general public

How Is This Different from Minnesota’s Paid Sick and Safe Leave Requirements?

  1. Annual Earning Cap Minimum
  • Federal Regulation: 56 hours.
  • Minnesota ESST Law: 48 hours.
  1. Carryover
  • Federal Regulation:
    • Under both the accrual method and frontloading, paid sick leave carries over from one year to the next. With the accrual method, federal contractors may limit the available sick leave in the “bank” to 56 hours at any time. With frontloading, contractors can limit yearly carryover to 56 hours, where the maximum amount of sick leave in the “bank” for an employee could potentially reach 112 hours (or more if you allow).
  • Minnesota ESST Law:
    • Accrual Method: Employees can carry over unused sick leave from year-to-year and employers may cap the maximum number of hours in the “bank” to 80 hours (but don’t need to).
    • Frontloading Method: Employers who frontload 48 hours annually are required to pay out employees for any unused paid sick leave. Employers choosing to frontload 80 hours annually do not have to pay out employees for unused paid sick leave.

In short, if you are a federal contractor in Minnesota, not only do you need to be sure you are in compliance with every local ordinance (so far, Bloomington, Minneapolis, St. Paul and Duluth), but also the new State law (Jan. 1, 2023) and the federal regulation due to the Executive Order.