Employers Cannot Inquire into Applicant’s Pay History

The Minnesota Legislature was sure to keep HR professionals/businesses and their employment law attorneys busy Q4 of 2023! If you’re wondering why my blog went silent…read on! Now that I’m out from under that rock, if you are from another state, or new to MN, here is what you’ve missed/need to know:

Effective January 1, 2024, Minnesota employers (including employment agencies and labor organizations) are prohibited from inquiring into a job applicant’s pay history (prior or current wage, salary, earnings, benefits) “for the purpose of determining compensation or benefits”. Applicants may voluntarily disclose this information (without being asked or prompted), and if they do so, employers can take this information into consideration as a basis to offer only a higher wage or salary than initially planned. Importantly, employers are still permitted to provide applicants information on compensation or benefits associated with a particular position, which includes discussing applicants’ expectations or requests pertaining to such compensation or benefits. In short, employers can inquire as to the compensation desired by an applicant, but not the history of compensation that applicant has received or is currently receiving.

Earned Sick and Safe Time Now in Effect Statewide

As I’ve blogged about previously, Minnesota’s statewide earned sick and safe time (“ESST”) law took effect January 1, 2024. The ESST law’s requirements may vary significantly from employers’ traditional PTO policies with respect to employee eligibility, how soon such time can be used, the increments in which such time can be used, minimum rates of accrual, carryover, and more. A few key points to recall:

  • Employers with employees working in one or more of the Minnesota cities with their own ESST ordinances (Bloomington, Duluth, Minneapolis, and St. Paul) must provide a PTO or ESST policy that is compliant with both each city’s particular ordinance and the state’s ESST law.
  • Employers with federal contracts also need to be sure you’re compliant with federal contracting regulations regarding paid time off.
  • Employers must provide employees notice of their ESST rights, which can be done through a conspicuous, public posting (like the traditional bulletin board in the breakroom, containing other legally required notices) or through an addendum to an employer’s employee handbook. You can get that online here.
  • The statewide ESST law (and the various city ESST ordinances) provide minimums for earned sick and safe time, not maximums; employers can always provide MORE leave, MORE accrual, MORE employee rights – just not less than the law requires.

Minimum Wage Increases for Minneapolis and St. Paul

In Minneapolis, effective January 1, 2024, the minimum wage rate for employers with 101 employees or more increased from $15.19/hour to $15.57/hour. Minneapolis employers with 100 employees or fewer will follow suit on July 1, 2024, when the minimum wage rate will increase from $14.50/hour to $15.57/hour.

In St. Paul, effective January 1, 2024, the minimum wage rate for employers with more than 10,000 employees and City of St. Paul employees increased from $15.19/hour to $15.57/hour. All other St. Paul employers will not see a minimum wage rate increase until July 1, 2024. At that time, the minimum wage rate for employers with 101 to 10,000 employees will increase from $15/hour to $15.57/hour; the minimum wage rate for employers with 6 to 100 employees will increase from $13/hour to $14/hour; and the minimum wage rate for employers with 5 or fewer employees will increase from $11.50/hour to $12.25/hour.

Recordkeeping Requirements Start July 2024 for Minnesota’s New Paid Family and Medical Leave Act (Going into Effect January 1, 2026)

Minnesota’s Paid Family and Medical Leave Act (PFMLA) will provide paid benefits for family and medical leave for qualifying employees beginning January 1, 2026, and will apply to nearly all private and public Minnesota employers. While the PFMLA won’t be effective until that time, employers should be aware of reporting obligations under the PFMLA that start July 1, 2024. Beginning July 1, employers must submit quarterly wage detail reports to the State, which must detail employee names, total wages (rounded to the next whole dollar amount) and the number of hours worked. These reports must include all employees who were employed during the payroll period that includes the 12th day of each calendar month. Further, employers must submit a report even when no wages are paid during a calendar quarter.

The specifics of the PFMLA (and how it differs from the federal FMLA) will be covered in subsequent blogs.

Happy New Year, Minnesota!