Minnesota Legislature
HF 1316
as introduced - 94th Legislature (2025 - 2026) Posted on 02/20/2025 02:49pm
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A bill for an act
relating to child support; adding independent contractors and payors to the
centralized work reporting system; requiring payors to report independent
contractors to the centralized work reporting system; amending Minnesota Statutes
2024, section 142A.29, subdivisions 1, 2, 3, 4, 6, 9.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1.
Minnesota Statutes 2024, section 142A.29, subdivision 1, is amended to read:
Subdivision 1.
Definitions.
(a) The definitions in this subdivision apply to this section.
(b) "Date of hiring" means the earlier of: (1) the first day for which an employeenew text begin or
independent contractornew text end is owed compensation by an employernew text begin or payornew text end ; or (2) the first day
that an employeenew text begin or independent contractornew text end reports to work or performs labor or services
for an employernew text begin or payornew text end .
(c) "Earnings" means payment owed by an employer for labor or services rendered by
an employeenew text begin or independent contractornew text end .
(d) "Employee" means a person who resides or works in Minnesota, performs services
for compensation, in whatever form, for an employer and satisfies the criteria of an employee
under chapter 24 of the Internal Revenue Code. Employee does not include:
(1) persons hired for domestic service in the private home of the employer, as defined
in the Federal Tax Code; or
(2) an employee of the federal or state agency performing intelligence or
counterintelligence functions, if the head of such agency has determined that reporting
according to this law would endanger the safety of the employee or compromise an ongoing
investigation or intelligence mission.
(e) "Employer" means a person or entity located or doing business in this state that
employs one or more employees for payment, and satisfies the criteria of an employer under
chapter 24 of the Internal Revenue Code. Employer includes a labor organization as defined
in paragraph deleted text begin (g)deleted text end new text begin (h)new text end . Employer also includes the state, political or other governmental
subdivisions of the state, and the federal government.
(f) "Hiring" means engaging a person to perform services for compensation and includes
the reemploying or return to work of any previous employee who was laid off, furloughed,
separated, granted a leave without pay, or terminated from employment when a period of
60 days elapses from the date of layoff, furlough, separation, leave, or termination to the
date of the person's return to work.
new text begin
(g) "Independent contractor" means a person over 18 years of age, or a corporation or
limited liability company with a sole shareholder or member, who performs services for
compensation in an amount equal to or greater than $600 per calendar year, to another
person or entity doing business in this state. Independent contractor includes but is not
limited to a person who logs in as a driver to the digital network of a transportation company
doing business in this state or of a company operating a network in this state to facilitate
delivery of food, goods, or services. Independent contractor does not include domestic
service in the private home of the service recipient.
new text end
deleted text begin (g)deleted text end new text begin (h)new text end "Labor organization" means entities located or doing business in this state that
meet the criteria of labor organization under section 2(5) of the National Labor Relations
Act. This includes any entity, that may also be known as a hiring hall, used to carry out
requirements described in chapter 7 of the National Labor Relations Act.
deleted text begin (h)deleted text end new text begin (i)new text end "Payor" means a person or entity located or doing business in Minnesota who
pays money to an independent contractor according to an agreement for the performance
of services.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective January 1, 2026.
new text end
Sec. 2.
Minnesota Statutes 2024, section 142A.29, subdivision 2, is amended to read:
Subd. 2.
Work reporting system established.
The commissioner of children, youth,
and families shall establish a centralized work reporting system for the purpose of receiving
and maintaining information from employers new text begin and payors new text end on newly hired or rehired employeesnew text begin
and independent contractorsnew text end . The commissioner of children, youth, and families shall take
reasonable steps to inform the state's employersnew text begin and payorsnew text end of the requirements of this
section and the acceptable processes by which employersnew text begin and payorsnew text end can comply with the
requirements of this section.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective January 1, 2026.
new text end
Sec. 3.
Minnesota Statutes 2024, section 142A.29, subdivision 3, is amended to read:
Subd. 3.
Duty to report.
Employersnew text begin and payorsnew text end doing business in this state shall report
to the commissioner of children, youth, and families the hiring of any employeenew text begin or
independent contractornew text end who resides or works in this state to whom the employer anticipates
paying earnings. Employersnew text begin and payorsnew text end shall submit reports required under this subdivision
within 20 calendar days of the date of hiring of the employeenew text begin or independent contractornew text end .
Employersnew text begin and payorsnew text end are not required to report the hiring of any person who will be
employednew text begin or paidnew text end for less than two months' duration; and will have gross earnings less than
$250 per month.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective January 1, 2026.
new text end
Sec. 4.
Minnesota Statutes 2024, section 142A.29, subdivision 4, is amended to read:
Subd. 4.
Means to report.
Employersnew text begin and payorsnew text end may report by delivering, mailing, or
telefaxing a copy of the employee'snew text begin or independent contractor'snew text end federal W-4 form or W-9
form or any other document that contains the required information, submitting electronic
media in a compatible format, toll-free telecommunication, or other means authorized by
the commissioner of children, youth, and families that will result in timely reporting.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective January 1, 2026.
new text end
Sec. 5.
Minnesota Statutes 2024, section 142A.29, subdivision 6, is amended to read:
Subd. 6.
Sanctions.
If an employernew text begin or payornew text end fails to report under this section, the
commissioner of children, youth, and families, by certified mail, shall send the employernew text begin
or payornew text end a written notice of noncompliance requesting that the employernew text begin or payornew text end comply
with the reporting requirements of this section. The notice of noncompliance must explain
the reporting procedure under this section and advise the employernew text begin or payornew text end of the penalty
for noncompliance. An employernew text begin or payornew text end who has received a notice of noncompliance and
later incurs a second violation is subject to a civil penalty of $25 for each intentionally
unreported employeenew text begin or independent contractornew text end . An employernew text begin or payornew text end who has received a
notice of noncompliance is subject to a civil penalty of $500 for each intentionally unreported
employeenew text begin or independent contractornew text end , if noncompliance is the result of a conspiracy between
an employernew text begin or payornew text end and an employeenew text begin or independent contractornew text end not to supply the required
report or to supply a false or incomplete report. These penalties may be imposed and collected
by the commissioner of children, youth, and families. An employernew text begin or payornew text end who has been
served with a notice of noncompliance and incurs a second or subsequent violation resulting
in a civil penalty, has the right to a contested case hearing under chapter 14. An employernew text begin
or payornew text end has 20 days from the date of service of the notice, to file a request for a contested
case hearing with the commissioner. The order of the administrative law judge constitutes
the final decision in the case.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective January 1, 2026.
new text end
Sec. 6.
Minnesota Statutes 2024, section 142A.29, subdivision 9, is amended to read:
Subd. 9.
Independent contractors.
The state and all political subdivisions of the state,
when acting in the capacity of an employer, shall report the hiring of any person as an
independent contractor to the centralized work reporting system in the same manner as the
hiring of an employee is reported.
Other payors deleted text begin maydeleted text end new text begin shallnew text end report independent contractors to whom they make payments
that require the filing of a 1099-MISC report. Payors reporting independent contractors
shall report by use of the same means and provide the same information required under
subdivisions 4 and 5. The commissioner of children, youth, and families shall establish
procedures for payors reporting under this section.
new text begin EFFECTIVE DATE. new text end
new text begin
This section is effective January 1, 2026.
new text end