HF 260

as introduced - 94th Legislature (2025 - 2026) Posted on 02/10/2025 03:09pm

A bill for an act
relating to employment; exempting small employers from the Minnesota Paid
Leave Law until January 1, 2028; amending Minnesota Statutes 2024, section
268B.01, subdivisions 15, 17, 18.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2024, section 268B.01, subdivision 15, is amended to read:

Subd. 15.

Covered employment.

(a) "Covered employment" means performing services
of whatever nature, unlimited by the relationship of master and servant as known to the
common law, or any other legal relationship performed for wages or under any contract
calling for the performance of services, written or oral, express or implied.

(b) For the purposes of this chapter, covered employment means an employee's entire
employment during a calendar year if:

(1) 50 percent or more of the employment during the calendar year is performed in
Minnesota; or

(2) 50 percent or more of the employment during the calendar year is not performed in
Minnesota or any other single state within the United States, or United States territory or
foreign nation, but some of the employment is performed in Minnesota and the employee's
residence is in Minnesota during 50 percent or more of the calendar year.

(c) "Covered employment" does not include:

(1) a self-employed individual;

(2) an independent contractor; deleted text begin or
deleted text end

(3) employment by a seasonal employee, as defined in subdivision 35 new text begin ; or
new text end

new text begin (4) employment by an employer with 20 employees or fewer as calculated under section
268B.14, subdivision 5b. This clause expires January 1, 2028 new text end .

(d) Entities that are excluded under this section may opt in to coverage following a
procedure determined by the commissioner. In such cases, services provided by employees
are considered covered employment under subdivision 15.

(e) The commissioner may adopt rules in accordance with chapter 14 to:

(1) further define the application of this subdivision; and

(2) establish the criteria for covered employment for individuals that do not meet the
criteria in paragraphs (a) and (b), but that perform services as an employee to a Minnesota
employer.

Sec. 2.

Minnesota Statutes 2024, section 268B.01, subdivision 17, is amended to read:

Subd. 17.

Employee.

(a) "Employee" means an individual who performs services of
whatever nature for an employer.

(b) Employee does not include employees of the United States of America, self-employed
individuals, or independent contractors.

(c) Employee does not include seasonal employees as defined in subdivision 35.

new text begin (d) Employee does not include employees of an employer with 20 employees or fewer
as calculated under section 268B.14, subdivision 5b. This paragraph expires January 1,
2028.
new text end

Sec. 3.

Minnesota Statutes 2024, section 268B.01, subdivision 18, is amended to read:

Subd. 18.

Employer.

(a) "Employer" means:

(1) any person, type of organization, or entity, including any partnership, association,
trust, estate, joint stock company, insurance company, limited liability company, or
corporation, whether domestic or foreign, or the receiver, trustee in bankruptcy, trustee, or
the legal representative of a deceased person, having any individual in covered employment;

(2) the state, state agencies, Minnesota State Colleges and Universities, University of
Minnesota, and other statewide public systems;

(3) any municipality or local government entity, including but not limited to a county,
city, town, school district, Metropolitan Council, Metropolitan Airports Commission, housing
and redevelopment authority, port authority, economic development authority, sports facilities
authority, board or commission, joint powers board or organization created under section
471.59, destination medical center corporation, municipal corporation, quasimunicipal
corporation, or other political subdivision. An employer also includes charter schools; and

(4) the taxpaying employer as described in section 268.046, subdivision 1.

(b) Employer does not include:

(1) the United States of America; deleted text begin or
deleted text end

(2) a self-employed individual who has elected and been approved for coverage under
section 268B.11 with regard to the self-employed individual's own coverage and benefits new text begin ;
or
new text end

new text begin (3) an employer with 20 employees or fewer as calculated under section 268B.14,
subdivision 5b. This clause expires January 1, 2028 new text end .