All companies and organizations with Minnesota-based employees must update their employment policies and practices due to recent state law changes going into effect on July 1, 2019. These updates are necessary due to the Minnesota Legislature’s passage of a law imposing new recordkeeping and notice requirements intended to protect all employees working in Minnesota. These new requirements are catching many employers off guard due to the lack of publicity for the new law and the short period to achieve compliance.
New Notice Requirements
Beginning on July 1, an employer must provide every new Minnesota-based employee with a written Wage Disclosure Notice confirming certain details relating to the employee’s compensation, including but not limited to the employee’s exemption status, rate of pay, leave benefits, payroll deductions, and regular payday schedule. Importantly, the employer must also obtain a signed copy of the Wage Disclosure Notice from the new employee.
Additionally, going forward, employers must provide all of their Minnesota employees, including both existing employees and new hires, with written notice of any changes to the information contained in the Wage Disclosure Notice in advance of implementing such changes. As a result, even though employers are not required to issue the new Wage Disclosure Notice to their existing Minnesota workforce, the Minnesota Department of Labor is taking the position that even existing employees must receive an updated copy of the Wage Disclosure Notice before their employer implements any wage-related changes.
New Recordkeeping Requirements
Under existing Minnesota law, employers are required to keep certain personnel records for three years after an employment relationship ends. The new law imposes additional recordkeeping requirements, including:
- A list of the personnel policies that were provided to each employee, including the date(s) the policies were given to the employee;
- A copy of the new Wage Disclosure Notice; and
- For all employees paid at piece rate, the number of pieces completed at each piece rate.
New Earnings Statement
Existing law requires employers to provide written or electronic earnings statements to their Minnesota employees. The new law adds to the existing disclosure requirements by requiring each earning statement to include:
- The employee’s rate or rates of pay, including whether the employee is paid by the hour, shift, day, week, salary, piece, commission or other method;
- Allowances claimed for permitted meals and lodging;
- A telephone number for the employer; and
- The physical address of the employer’s main office or principal place of business and a mailing address, if different.
More Changes to Minnesota’s Wage Laws
Other notable changes resulting from the new law include:
- an anti-retaliation provision, which makes it unlawful for an employer to retaliate against employees for exercising their rights under Minnesota’s wage statutes;
- a requirement that employers pay wages at least once every 31 days;
- a requirement that employers pay commissions at least once every three months; and
- the potential for criminal penalties for employers that intentionally fail to pay an employee all wages and commissions owed.
One Other Notable Change for Employees in Minneapolis and St. Paul
In addition to the new wage-related requirements discussed above, those employers with employees working even part-time in Minneapolis or St. Paul may be obligated to provide such employees with paid sick leave due to a recent employee-friendly decision by the Minnesota Court of Appeals. The recent court decision upholds efforts by the City of Minneapolis to enforce its paid sick leave ordinance against employers that do not have a physical presence within city limits with respect to any employees who work at least 80 hours within Minneapolis each year. That decision is currently pending appeal to the Minnesota Supreme Court.
Businesses that employ even one worker in Minnesota must take immediate steps to ensure compliance with these sweeping changes to Minnesota’s wage laws. For more information on these recent changes to Minnesota’s employment law landscape, please contact your counsel at Spencer Fane.
This blog post was drafted by Randi Winter, a Partner in Spencer Fane’s Minneapolis office.