Nobody ever said running a business was a walk in the park. As an employer, you have a lot of balls in the air, and compliance with employment laws is just one of them. One really, really important one that, if dropped, could cost you a whole lot of money.
In addition to federal law, each state has their own share of employment-related laws that business owners need to be aware of. Here, we’re highlighting some of these key state-specific requirements and laws, and offering guidance to help you keep up.
Bear in mind, this list is not comprehensive, and there may be local or industry-specific employment requirements that your business needs to comply with. It’s best to consult with legal counsel to ensure compliance with all applicable laws, as Justworks does not provide legal advice.
Payroll Tax Accounts
Because Justworks reports state unemployment taxes on behalf of customers who utilize Justworks’ PEO services, Justworks may need to collect account information such as your account number and current rate. You can read more about it here: State Unemployment Insurance.
Recruiting & Hiring Practices
Ban-the-Box
Minnesota’s ban-the-box law prohibits most employers from asking applicants about their criminal histories until they are selected for an interview. If interviews are not conducted, employers may not ask for this information until a conditional offer of employment has been extended. The law also prohibits an employer from using an employment application that asks for an applicant’s criminal history.
Minnesota Department of Human Rights (DHR): Ban the Box Submission Form
Mineral*: Minnesota Applicant and Employee Screening
Inquiries Revealing Protected Class Information
Under the Minnesota Human Rights Act, it is an illegal, discriminatory employment practice for an employer to require or request a person to provide information that pertains to their protected class, before they are hired. This means that an employer cannot seek information on an application form, in a job interview, from a physical exam/health history, or from a third party such as an employment agency or prior employer. Notably, Minnesota protects certain classes which are not protected under federal law, including persons who use lawful consumable products (such as cannabis) where not otherwise prohibited by occupation. For more information on protected classes in Minnesota and hiring practices, see
Minnesota DHR: Hiring and Interviewing (Protected Classes)
Salary History Inquiries
Minnesota law prohibits an employer from seeking information from any source regarding an applicant’s pay history unless such information is a matter of public record or voluntarily disclosed by an applicant and used to support a job offer higher than the employer anticipated extending to the applicant. An applicant for employment may voluntarily, and without being asked by an employer, disclose pay history for the purposes of negotiating wages, salary, benefits, or other compensation.
Mineral*: Minnesota Pay Equity and Transparency
Non-Compete Agreements
Minnesota law provides that a covenant not to compete entered into on or after July 1, 2023 is void and unenforceable. The law does not prohibit restrictions on the use of client confidential information and contains some exceptions during the sale or dissolution of a business. Consult with legal counsel as to restrictions that are lawful in Minnesota.
Mineral*: Minnesota Employment Agreement Restrictions
Wage Theft Law and Notice
Minnesota employers are required to satisfy the requirements of the state’s Wage Theft Law by providing new hires with a written notice that includes information regarding, among other things, their rate and manner of pay, including whether they are exempt or non-exempt from overtime. All employers must keep a signed copy of the notice on file. Employers may find templates on the state’s website.
In Minneapolis, employers may have additional wage theft notice requirements under the city's Wage Theft Ordinance.
Wage Theft Notice Requirements - Minnesota
Drug Testing
Minnesota has a comprehensive drug testing law which applies to private employers (the Minnesota law is commonly referred to as “DATWA”). The Minnesota law requires a written policy and has specific requirements as to the content and procedures for employee drug testing.
In July 2023, Minnesota added cannabis-related products to its “lawful consumable products” law. This means an employer cannot refuse to hire, discipline or discharge an employee for cannabis use away from work (with certain industry specific exceptions). The law does not allow the consumption of cannabis on company premises or during work hours, including break time. Employers must consider cannabis use laws when drafting a drug testing policy and should consult with legal counsel.
Mineral*: Minnesota Drugs, Alcohol, and Smoking
Independent Contractors
When classifying workers as employees or independent contractors, there are a few things to consider, including the different legal tests that apply under various federal and state employment laws, and potential penalties and other liabilities for misclassifying employees as independent contractors. Certain state laws apply tests that are more stringent or different than the guidance provided by federal agencies, such as the IRS and Department of Labor, to apply in conjunction with federal laws.
You can read our general Help Center article on contractors, and view information on how to determine if someone is a contractor or employee in Minnesota in the relevant section at the link below.
Minnesota Department of Revenue (DOR): Independent Contractor or Employee
Mineral*: Minnesota Independent Contractors
Pay Requirements
Minnesota rules on overtime and minimum wage can be found at the corresponding links, with additional information found in the FAQs below.
Minnesota Department of Labor and Industry (DLI): Wages and Overtime FAQs
Mineral*: Minnesota Minimum Wage and Overtime
Certain Minnesota localities have a higher minimum wage than at the state level. Where both laws apply to an employee based on worksite, the law that favors the employee must be applied. Minimum wages in localities are always changing. The best way to ensure compliance with all applicable laws is to consult with legal counsel.
You can also find guidance for employers in Minnesota on a variety of employment practices topics here.
Wage Disclosure Protection
Every Minnesota employer must comply with the Wage Disclosure Protection law. This law provides that an employer cannot prohibit employees from disclosing their own wages. Employers that provide an employee handbook to their employees must include in the handbook a notice of employee rights and remedies under the Wage Disclosure Protection law.
Minnesota DLI: Wage-disclosure protection FAQs
Restroom Breaks and Meal Breaks
Minnesota requires employers to provide all employees with restroom time and sufficient time to eat a meal. If the break is less than 20 minutes in duration, it must be counted as hours worked. Time to use the nearest restroom must be provided within four consecutive hours of work. Meal time must be provided to employees who work eight or more consecutive hours. The employer can set the hours an employee works, including when a meal or rest break can be taken.
Mineral*: Minnesota Meal and Rest Periods
Lactation Breaks
Minnesota employers must provide reasonable break times each day to lactating employees who need to express milk. Employers must make reasonable efforts to provide a clean, private, and secure room that is private, shielded, and close to the lactating employee’s work area where employees can take such breaks. The space must include an electrical outlet, and may not be a bathroom or toilet stall.
Mineral*: Minnesota Lactation Accommodations
Benefit Requirements
State Retirement Program
The Minnesota Secure Choice Retirement Program is the state of Minnesota’s program designed to give employees access to a retirement savings plan when their employer does not offer a private plan meeting the minimum standards. You can read more about state retirement programs at the link below.
Leave
Paid Sick and Safe Leave
Minnesota’s Earned Sick and Safe Time (ESST) became effective January 1, 2024 and applies to any employee (including part-time or temporary employees) who work 80 hours in the state of Minnesota in a year. While there are a few industry specific exceptions, the law generally requires that employers allow eligible employees to accrue one hour of sick leave for every 30 hours worked, up to a maximum of 48 hours in a year. There are also “front-loading” options an employer may utilize for administrative ease, each of which has different rules as to carryover and pay out, in addition to other requirements. Employees can utilize paid sick and safe leave for the following reasons:
- the employee’s mental or physical illness, treatment or preventive care;
- a family member’s mental or physical illness, treatment or preventive care;
- absence due to domestic abuse, sexual assault or stalking of the employee or a family member;
- closure of the employee’s workplace due to weather or public emergency or closure of a family member’s school or care facility due to weather or public emergency; and
- when determined by a health authority or health care professional that the employee or a family member is at risk of infecting others with a communicable disease.
You can read more about sick and safe leave in Minnesota at the links below:
Mineral*: Minnesota Sick Leave
Pregnancy and Parental Leave
Minnesota provides up to 12 weeks of unpaid, job-protected leave for pregnancy, birth, or adoption. Unpaid leave under the law is available to all Minnesota employees, regardless of tenure or size of the employer. Where federal FMLA applies, leave taken under the Minnesota law will run concurrently with FMLA leave.
This law also expands certain protections to nursing and lactating employees, and requires pregnancy accommodations. Employers are required to provide private, clean, and secured locations to express breastmilk and provide additional breaks (without loss of compensation) to employees who may need them. Minnesota also requires that employers provide a notice about these rights, which can be found here.
Minnesota DLI: Pregnancy and Parental Leave Act
School Conferences and Activities Leave
In Minnesota, an employer must grant an employee leave of up to a total of 16 hours during any 12-month period to attend school conferences or school-related activities for the employee’s child, provided the conferences or school-related activities cannot be scheduled during non-work hours.
Mineral*: Minnesota School-Involvement Leave
Paid Family & Medical Leave
Starting January 1, 2026, Minnesota employees will be eligible to take up to 20 weeks paid family and medical leave for various covered reasons such as one’s own medical condition or to bond with a newborn. Employer and employee contributions will also begin January 1, 2026.
Minnesota Department of Employment and Economic Development (DEED): Minnesota Paid Family and Medical Leave
Mineral*: Minnesota Family and Medical Leave
Harassment & Discrimination
In addition to protections under Federal law, Minnesota law prohibits employment discrimination based on membership in any protected class by employers covered under Minnesota's anti-discrimination laws. Minnesota law includes protected classes beyond those protected by federal law. For example, Minnesota includes within race discrimination, traits associated with race, including hair texture and hair styles such as braids, locs and twists. Additionally, Minnesota prohibits discrimination on the basis of gender identity and sexual orientation. For a full list of protected classes in Minnesota, see below.
Minnesota Department of Human Rights (DHR): Who is protected?
Mineral*: Minnesota Employment Discrimination and Accommodations
Minnesota also has a Whistleblower Protection Act which prohibits retaliation against persons who in good faith make reports about certain types of employer conduct.
Minnesota DHR: Minnesota Human Rights Act
Mineral*: Minnesota Whistleblower Protection
Separation
Minnesota employers should familiarize themselves with specific compliance issues and certain key documents for separating employees.
Mineral*: Minnesota Separation
Final Wage Payment Requirements
In Minnesota, the final paycheck for separated employees must be paid on the next regularly scheduled payday unless the employee makes a written demand for payment.
If a separated employee makes a written demand for payment, all wages and commissions are due and must be paid within 24 hours of the demand.
If a Minnesota employee resigns, the final paycheck should be issued on the next scheduled payday. However, if the next payday is less than five days after the last day that the employee works, the employer can pay on the next payday or 20 days after the employee's last day of work, whichever is earlier.
In Minnesota, company policy determines whether an employer is required to pay such things as vacation, PTO or sick leave upon termination.
Notice of Separation, Personnel Records Requests, and Separation Agreements
Minnesota does not require a notice of separation upon separation of an employee for any reason. However, Minnesota does have a law allowing an employee to make a written request for the reason for their termination, if the request is made within 15 working-days of termination. The employer has 10 working-days from receipt of the request to give a truthful reason, in writing, for the termination.
Minnesota also has a comprehensive law which allows an employee to review and obtain copies of his or her personnel records and even allows requests by former employees following separation. The law has a 7-day or 14-day response period for the employer depending on whether the records requested are located in Minnesota or outside of Minnesota.
Employers should also be aware that Minnesota has specific requirements if an employer wishes to obtain a release of claims under the Minnesota Human Rights Act that include a 15-day period during which customers can rescind their release. Unlike the federal age discrimination law, the Minnesota rescission or revocation period applies to any protected class.
Minnesota DLI: Employment termination
Minnesota DEED: How to file a claim for unemployment insurance benefits
Mineral*: Minnesota Personnel Files
Business Closings and Layoffs
The Federal WARN Act imposes certain notice requirements and other obligations on covered businesses before conducting large-scale business closures, layoffs, or relocations. For more information, visit the link below.
U.S. Department of Labor: Worker Adjustment and Retraining Notification (WARN) Act Advisor
Minnesota DEED: Office of Dislocated Worker and Federal Adult Programs
Mineral*: Minnesota Layoffs
Notes
*Be sure you’re logged into your Justworks account with administrative permissions to access Mineral.
Disclaimer
This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, legal or tax advice. If you have any legal or tax questions regarding this content or related issues, then you should consult with your professional legal or tax advisor.