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Key insights
- Paid leave benefits and job protections are now available to eligible Minnesota workers (effective January 1, 2026).
- Employers fund the program through premiums: 0.88% in 2026 (0.66% for qualifying small employers), on wages up to $185,000.
- Employers must provide notices (poster and individual notice), submit quarterly wage detail reports, and remit premiums quarterly starting April 2026.
Get guidance and help with Minnesota’s paid leave.
Paid leave benefits support employees who need time off to care for themselves or their loved ones. Discover how Minnesota’s new paid leave program may impact your business while providing essential support for your employees during life’s critical moments.
New paid leave benefits in Minnesota
The law, effective January 1, 2026, provides job protection and partial wage replacement, paid through the state, for individuals taking leave for qualifying reasons. The program is funded by premiums with contributions from both employers and employees.
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How can Minnesota employers comply with paid leave laws?
Provide employee education
Review your organization’s current medical and family leave policies for compliance with the new law and inform employees of their new rights and benefits. The law requires employers to update policies and display workplace posters to reflect the new law. Posters can be downloaded from the Minnesota Department of Employment and Economic Development (DEED).
Employers must provide both a workplace poster and individual notice in employees’ primary languages and retain acknowledgment records. If notices were not distributed by the state mandated deadlines, they should be distributed immediately and documented.
Comply with reporting requirements
To calculate benefit payments and determine eligibility, the state requires employers to submit quarterly wage detail reports. This requirement went into effect on October 31, 2024.
Reporting includes statements of employee wages, which are necessary for calculating contributions to the program, submitted through the state unemployment insurance (UI) system. If your organization does not have a UI account, you can still register and submit the reports.
The new paid leave uses the UI wage reporting system for both wage detail and premium administration, with quarterly remittance required beginning April 2026.
You can also choose to meet your responsibilities by providing employees with an equivalent plan that meets or exceeds the coverage offered by the state. If you choose this option, you must apply for an equivalent plan exemption and will still be required to submit wage detail reports each quarter and comply with employee notification requirements.
Determine premium contributions
The program is funded through contributions collected through the UI account on a quarterly basis. Employers have the option to pay 100% of the premium or split the cost with their employees. Deductions from employee paychecks began January 1, 2026.
For 2026, the total premium rate is 0.88% of covered wages (0.66% for qualifying small employers). Employers may not withhold more than 0.44% from employees, and any employer paid employee portion becomes taxable wages.
Coordinate paid leave with existing benefits
Employers should clarify how Minnesota paid leave interacts with paid time off, short‑term disability, and the Family and Medical Leave Act where applicable.
Clear intake procedures, documentation standards, and decisions around optional supplemental (“top‑off”) pay can help reduce employee confusion and administrative friction, especially for intermittent leave scenarios.
If you’re behind: A practical catch-up plan
- If you missed required notices: Distribute and post immediately, document when/how you notified employees, and retain acknowledgments.
- If you didn’t begin payroll deductions on January 1: Start deductions as soon as possible moving forward (prospectively only). Retroactive deductions are prohibited, so employers must absorb the missed employee contributions*.
- Reconcile employer funding so your first quarter premium payment can be made on time.
- If wage detail reporting is behind: Submit missed reports (the state allows employers to submit wage reports back to earlier quarters when they begin reporting).
* If an employer pays any part of the employee’s required 0.44% PFML contribution, that amount becomes taxable income to the employee and must be included in their W‑2 wages. This is because the employer is covering an obligation assigned to the employee under the law.
How CLA can help with Minnesota paid leave
As Minnesota paid leave moves from planning to day-to-day administration, employers are handling both compliance requirements and real operational impacts.
CLA’s Total HR consulting professionals can help employers:
- Interpret paid leave requirements
- Update policies and handbooks
- Establish clear processes for employee communication, documentation, and coordination with existing leave and benefit programs
This includes support for intermittent leave tracking, manager guidance, and compliance readiness reviews to confirm accounts, notices, payroll setup, and wage reporting are in place.
Beyond policy and compliance, many employers are experiencing immediate staffing gaps when employees take paid leave, particularly within finance and accounting functions.
CLA’s client accounting and advisory services (CAAS) can help bridge these gaps by providing:
- Interim accounting or finance support during leave
- Short term coverage for daily and monthly accounting needs
- Transitional support while permanent solutions are evaluated
Whether leave is planned or unexpected, CAAS professionals — including former controllers, CFOs, and finance leaders — can step in quickly to help maintain continuity and reduce disruption during periods of employee absence.
Whether you need updated policies, advisory or administration with leaves, or interim coverage during leaves of absence, our team offers tailored support to meet your needs.
Contact us
Get guidance and help with Minnesota’s paid leave. Complete the form below to connect with CLA.