Effective July 3, 2019, the City of Minneapolis’ revised rules implementing the Sick & Safe Time Ordinance Rules go into effect. Notably, non-resident employers (employers located outside of Minneapolis but who have employees performing work in Minneapolis) are now subject to enforcement. If non-resident employers provided employees with a paid time off program or paid
On Wednesday, May 9, 2018, the Minnesota District Court (Hennepin County) upheld the status quo (remember the temporary injunction I wrote about earlier), finally determining that state law does not preempt the Minneapolis Sick & Safe Leave Ordinance, but the Ordinance cannot be enforced by Minneapolis outside the geographic boundaries of the City of Minneapolis.…
Duluth is one step closer to passing its own Earned Sick & Safe Time ordinance (ESST), to go into effect January 1, 2020. Following in the footsteps of Minneapolis and St. Paul, Duluth’s proposed ordinance would require employers to provide employees with 1 hour of time off for every 50 hours worked. Employees would…
As many employers are reviewing handbooks and policies for revisions for the new year, Employers without a business located in Minneapolis (but who have workers working in Minneapolis) should note that you do not yet need to comply with the City of Minneapolis Sick and Safe Leave Ordinance. On September 18, 2017, the Minnesota…
It’s been a month since the City of Minneapolis Sick and Safe Time Ordinance has gone into effect (July 1, 2017), and thus, employers based in Minneapolis with workers in Minneapolis should have already modified their existing paid time off (PTO) policy, or created a new sick and safe time policy. The most frequent question…
The Minnesota Chamber of Commerce, along with several other employer groups such as TwinWest Chamber of Commerce, filed a lawsuit today in Hennepin County challenging the City of Minneapolis’ new Sick & Safe Leave Ordinance – as recently amended. The press release summarizing the action can be found here. In short, they…
On May 27, 2016, the Minneapolis City Council unanimously approved the Minneapolis Sick and Safe Time Ordinance, Title 2, Chapter 40 – Workplace Regulations. The final Ordinance mandates unpaid sick and safe leave for employers with 1 to 5 employees, and paid sick and safe leave for employers with 6 or more employees. Notably, the final amendment includes not only the use for sick and safe care, but also school snow days.
Below is a quick overview of what the ordinance requires, who it applies to, what burdens employers have, and the implications of a violation. However, time will only tell how this plays out in reality.
What Does the Minneapolis Sick and Safe Time Ordinance Require?
The Ordinance, effective July 1, 2017, requires employers to provide employees with paid/unpaid sick and safe time. New employers (with 1 or more employees), will have 12 months to provide unpaid time off. After 12 months, new employers will be subject to the Ordinance in its totality (this 12 month delay will only be allowed for 5 years from the enactment).
Employees working in Minneapolis will accrue sick and safe time unpaid leave at the rate of 1 hour for every 30 worked, up to an annual cap of 48 hours (either calendar or fiscal year). Exempt (salaried) employees are deemed to work 40 hours each week unless their normal workweek is less than 40 hours. Employees must be allowed to use sick and safe time after 90 calendar days of employment. Employers must permit an employee to carry over at least 80 hours of accrued but unused sick and safe time into the following year.
Additionally, sick and safe leave time need not be paid this time out at termination. Employees must be able to use the leave in the same increment of time consistent with current payroll practices and existing employer policies (but no more than 4 hours). They must be compensated at the same hourly rate with the same benefits (except they are not entitled to lost tips or commissions and compensation is only required for the hours the employee was scheduled to work).
Who Is An “Employer” and “Employee” Under the Ordinance?
Does this Ordinance affect your business based in Eden Prairie or Alexandria? It depends on whether you are a covered employer, defined below. The Ordinance defines several terms with specificity, but here it is in a nutshell:…
Well, I don’t want to say I called it but…on April 8, 2016, I wrote a post about Minneapolis’ proposed paid sick leave and managing paid sick leave laws in multiple states, suggesting that this issue is only going to spread. Indeed, it has. Minnesota is proposing a paid sick leave fund comparable to the State of California – but even going beyond (one upping CA?! Impressive feat if passed). Though I didn’t know it then, I now know that on March 10, 2016, State Senators Sieben, Pappas, Franzen, Bakk and Hawj introduced SF2558, “a bill for an act relating to paid family medical leave benefits; establishing a family and medical leave benefit insurance program; imposing a wage tax; authorizing rulemaking; creating an account; appropriating money” and amending the state statutes accordingly. The proposed law has been amended and is currently before the Finance committee in its 3rd engrossment. English = it is still pending and here is the latest version. It proposes to be effective January 1, 2020, though the payroll tax will take effect 2018 (the State needs 2 years of taxes to have money to pay employees this proposed benefit).
Bill Proposes New Payroll Tax (Effective August 1, 2016) on Employers and Employees.
If passed as drafted, a new payroll tax will be imposed on employers with 21 or more employees (working in Minnesota during the past year) starting August 1, 2016. Employees of covered employers would also suffer the new payroll tax. The initial tax rates are 0% for 2017, 0.05% for 2018 and 0.1% for 2019. The rates in 2020 have not been introduced yet. The proposed bill seeks an appropriation in 2017 from the general fund to get the program started.
What happens to the money from the tax? It will go into a new state-run trust fund to be used to replace between 55% – 80% of an employees wages for up to 12 weeks a year for leave to care for family member, pregnancy-related condition and/or to bond with a newborn child (whether biological or adoptive). In addition, if the IRS determines that the benefits are subject to federal income tax, that tax would be withheld.
How Would This Work?
The Commissioner of Minnesota’s Department of Employment and Economic Development (“DEED”), currently Katie Clark Sieben, would be tasked with administrating the new benefit insurance program. Accordingly, DEED must create three application forms both for online applications and in paper: (1) family care benefits; (2) bonding benefits; or (3) pregnancy benefits. Once the employee applies, the Commissioner would have 2 weeks to approve or deny the application. If the application is determined “valid” and thus approved, the employee would then be notified of the week when benefits commence, the weekly benefit amount payable, and maximum duration. The employer would also be notified and provided rights to participate in an hearing and appeal process. Denied applications (deemed “invalid”) may be appealed, similar to unemployment, via a hearing before a newly created “benefit judge” (as well as challenges by employers).
What Employees Are Eligible?
An employee would be eligible for leave if the employee performed services for the employer for at least 6 months before the request (note this is less than the 12 months required by FMLA) and for at least 20 hours a week (well, it’s a little more complicated formula, but basically – half-time employees).
What Could Leave Be Taken For?
Minneapolis is one of many cities giving increased attention to mandating a paid sick leave policy. On March 16, 2016, the Minneapolis Workplace Regulations Partnership Group (WPG) (created by Mayor Betsy Hodges and the Minneapolis City Council) submitted its Findings & Recommendations to the Minneapolis City Council. In a nutshell, the WPG recommended the City pass a sick time policy covering all employers “working in the City of Minneapolis regardless of employer location”.
The Proposed Minneapolis Paid Sick Leave Policy
The proposed Minneapolis policy (which I won’t get into great detail in this post), would require covered employers to provide employees with paid sick time for themselves or members of extended families and household for mental and physical health. The proposal recommends that employees accrue sick time at the rate of 1 hour for every 30 worked, up to an annual cap of 48 hours. Employees would be allowed to carryover up to 80 hours of accrued, unused sick time – but need not be paid this time out at termination. WPG member Steve Cramer of the Minneapolis Downtown Council (business association representative) submitted a Minority Statement proposing an alternative means to address the Council’s sick leave policy goal and noting several issues with the proposed policy (such as employers who already have a successful flexible PTO policy may not mirror the City’s ordinance, but otherwise achieves the same objectives of paid time off for sickness). It is those concerns that employers are raising – how can we possibly keep up with the nuances of yet another sick leave ordinance when we already have a comprehensive paid time off policy?
Various Paid Sick Leave Laws and Ordinances Already Exist Nationwide
On March 11, 2016, the US DOL WHD extended the comment period through April 12, 2016 for its Notice of Proposed Rulemaking implementing Executive Order 13706, Establishing Paid Sick Leave for Federal Contractors.
First published on February 25, 2016, the proposed rule seeks to implement the Executive Order signed by President Obama on…