After establishing Earned Sick and Safe Time (“ESST”) in the 2023 legislative session, the State made several modifications and clarifications. At the time of publication, the changes are not reflected in statute, but reside in the 2024 session laws here: https://www.revisor.mn.gov/laws/2024/0/127/laws.11.5.0#laws.11.5.0. The bill itself is a monstrous omnibus bill typical of Minnesota. The bill covers dozens of topics; the portion relevant to ESST is Article 11. This bulletin assumes the reader has some familiarity with ESST as it was established in 2023 and covers only the changes made in 2024.
Section 5 changes 181.9445, subdivision 4. Replaces “hourly” rate with “base” rate for pay during ESST.
“Base rate” means:
- For simple hourly workers, base rate = hourly rate.
- For hourly workers with multiple rates, base rate = hourly rate for the time they took off; that is, whatever they would have made if not for ESST.
- For salaried workers, the same rate is guaranteed to the employee as if the employee had not taken leave.
- For workers paid on any other basis (commission, piecework, etc.) the highest of the applicable federal, state, or local minimum wage.
“Base rate” does not include Overtime premiums, shift differentials, weekend or holiday premiums, bonuses or tips
Section 7 changes 181.9445, subdivision 5 to clarify the definition of “Employee”:
“”Employee” means any person who is employed by an employer, including temporary and part-time employees, who is anticipated by the employer to perform work for at least 80 hours in a year for that employer in Minnesota.”
The effect here appears to be to clarify that the employee is eligible on day 1 of employment and not after working 80 hours.
It’s possible that this language could also shield employers who hired someone short term, anticipating that said worker would work less than 80 hours, but who then retained the employee for more than 80 hours. In that unique case, the statute appears to hold that the employer could start awarding ESST after 80 hours.
“Employee” does NOT include:
- An independent contractor; (no change)
- Volunteer or paid on-call firefighter or ambulance personnel. (It’s more complicated than that, if you’re in that industry, read more closely.)
- Person serving in an elected government position (even if appointed).
- Farm worker if, employed “to perform” work for 28 days or less per year. (Seems to open the door to people hired with the intent to work 28 or less, but who end up working more for unforeseen circumstances.)
- Aircrew now removed from exemption.
Section 8 of the session law changes section 181.9446, Subsection (b)(2) (the conditions under which an employer may avoid carry-over):
Now uses “base” instead of “hourly” rate.
Stipulates that pay for ESST must not be less than under section 177.24 or local minimum wage, if any.
Section 9 of the session law changes section 181.9447, subdivision 1 (eligible use), is amended to include ESST use for funeral arrangement, funeral attendance, and “to address financial or legal matters that arise after the death of a family member.”
The statute places no further limits or definitions. This could arguably include:
Probate hearings. Cleaning decedent’s house to prepare for sale? Mowing decedent’s lawn?
This change reinforces my original advice on ESST—Don’t scrutinize EE’s reason for use. They have a bank, if they want to burn it, that’s their choice.
Section 10 of the session law changes section 181.9447, subdivision 3 to clarify documentation issues.
Previously ER could demand documentation after 3 consecutive days. Now can demand only after 3 consecutive “scheduled workdays”.
For domestic abuse ESST, EE may certify their time in writing “if documentation [from others as described in statute] cannot be obtained in a reasonable time or without added expense[.]”
Again, there is little incentive for ERs to scrutinize the purpose of ESST; just grant it so long as the EE has it banked.
Section 11 of the session law changes section 181.9447, subdivision 5 (Increment of time used) as follows:
Changes “smallest increment of time tracked” to “increment of time for which employees are paid.”
But
ER not required to give ESST in less than 15 min increments
ER may not require use in more than 4-hour increments.
Section 12 of the session law changes section 181.9447 subdivision 10 (Employer records).
Title of subdivision is now “Employer records and required statements to employees.”
New paragraph (b) adds information to paystub. (Doesn’t need to be on paystub, can be separate, but most ERs will use paystub.)
Total number of ESST hours available
Total number of ESST hours used that period
If provided electronically, must let EEs use ER provided computer to view and print.
Both the previous ER records and the new statements must be kept for 3 years.
Both the previous ER records and the new statements must be available for the Commissioner’s inspection; kept either on site or available in 72 hours.
Section 13 of the session law changes section 181.944 subdivision 11 (Confidentially and nondisclosure). It allows ERs to keep medical records for more than the 3 years established under the existing statute, if another state or federal law so requires.
Section 14 of the session law changes section 181.9447 by adding a subdivision 12, “Weather event exception.”
Prohibits EEs from using ESST for weather if:
EE is a firefighter, peace officer, 911 operator, jailor, or is a government EE with a commercial driver’s license; and
EE’s preassigned or foreseeable work duties would require EE to respond to the weather event; and
Either of the following:
EE is in a union and CBA explicitly says EEs position is not entitled to weather based ESST.
or
EE is not in a union, but ER has written policy stating that minimum staffing requires such an exemption
Section 15 of the session law changes section 181.9448, subdivision 1. This subdivision was called “No effect on more generous sick and safe time policies.” The session law crosses out the “No” and emplaces affirmative obligation on leave offered by the employer above and beyond the ESST minimums.
The entirety of the old paragraph (a) remains. That was/is “Nothing in sections 181.9445 to 181.9448 shall be construed to discourage employers from adopting or retaining earned sick and safe time policies that meet or exceed, and do not otherwise conflict with, the minimum standards and requirements provided in sections 181.9445 to 181.9448”
Some complex language is now added: “All paid time off and other paid leave made available to an employee by an employer in excess of the minimum amount required in section 181.9446 for absences from work due to personal illness or injury, but not including short-term or long-term disability or other salary continuation benefits, must meet or exceed the minimum standards and requirements provided in sections 181.9445 to 181.9448, except for section 181.9446.”
In other words, all leave you offer must now comply to the ESST statute, (other than the accrual minimums of 181.9446). This includes the reasons for use, the notice requirements, etc.
Ultimately, this may not be such a big change since most employers shifted their leave processes to accommodate the ESST standards anyway.
But this is one more instance of the State putting a one-size-fits all solution on the entire Minnesota economy.
The additions to (a) continue: “For paid leave accrued prior to January 1, 2024, for absences from work due to personal illness or injury, an employer may require an employee who uses such leave to follow the written notice and documentation requirements in the employer’s applicable policy or applicable collective bargaining agreement as of December 31, 2023, in lieu of the requirements of section 181.9447, subdivisions 2 and 3, provided that an employer does not require an employee to use leave accrued on or after January 1, 2024, before using leave accrued prior to that date.”
In other words, leave accrued under the 2023 standards may still be used as under 2023 policies.
Section 16 of the session law amends 181.9448, subdivision 2 “Termination; separation; and transfer.” This subdivision held that if an employee is terminated, but rehired within 180 days, the employee’s ESST bank is replenished. The amendment clarifies that if banked ESST is paid out on termination, the amount paid out is not replenished.
Immediate Action Items for Employers:
- Recalculate “base rate” for any employee paid on anything other than a standard wage.
- If you presently scrutinize employees’ requests for ESST, consider approving it as a matter of course.
- Align use of ESST to the increments in which you pay.
- Ensure your paystub includes the necessary information.
- Make a plan to keep pay and ESST information for 3 years.
- If you are offering paid leave above the ESST minimums, ensure that you are offering it on the same terms as ESST; or consider ceasing to offer excess.
Economic Consequences and Non-Legal Considerations:
The State of Minnesota continues its takeover of your Human Resources department and policies.
Date of this Report: September 16, 2024
Author: Cory Genelin, cgenelin@gislason.com
