The Minnesota Department of Labor and Industry (DLI) has adopted new administrative rules providing additional guidance and clarification regarding the state’s Earned Sick and Safe Time (ESST) law. The rules establish new standards that employers must follow when administering ESST benefits.
While the rules do not fundamentally change the ESST statute, they provide important direction on accrual, usage, documentation, eligibility, and administration.
New Guidance on Accrual Years
The rules clarify that an ESST accrual year must be a regular, consecutive 12-month period selected by the employer and clearly communicated to employees. If an employer does not designate and communicate an accrual year, the calendar year will apply by default.
The rules also establish procedures for changing an accrual year, including advance written notice requirements and protections to ensure employees are not disadvantaged by the change.
Clarification of Employee Eligibility
The rules provide additional guidance regarding which employees qualify for ESST.
Minnesota law generally applies to employees anticipated to perform at least 80 hours of work in Minnesota in a year. The new rules specify that employers must make this determination in good faith, taking into account anticipated schedules and work locations. Employees who ultimately work at least 80 hours in Minnesota become entitled to ESST protections even if the employer initially anticipated otherwise.
New Standards for Crediting and Accruing ESST
For employers using the accrual method, the rules clarify that ESST must be credited no later than the regular payday following the applicable pay period and becomes available for use once credited.
The rules also clarify that:
- Employers are not required to credit fractions of an hour of ESST;
- Uncredited time must carry forward into future pay periods; and
- Employees must still receive at least the statutory accrual rate of one hour of ESST for every 30 hours worked, subject to statutory limits.
New Rules for Frontloading and Advancing ESST
The rules provide new guidance for employers that frontload or advance ESST.
Among other requirements:
- Advanced ESST must be calculated at no less than the statutory accrual rate;
- Employers generally are not required to advance more than 48 hours of ESST unless another law or policy requires more; and
- If an employee works more hours than anticipated when ESST was advanced, additional ESST must be provided within 15 calendar days of reaching that threshold.
The rules also clarify that changes between accrual and frontloading methods generally cannot take effect until the beginning of the next accrual year and require advance written notice to employees.
Additional Documentation and Misuse Standards
The rules provide employers with greater clarity regarding documentation requirements and suspected misuse.
Although employers generally may require documentation only after an employee uses ESST for more than two consecutive scheduled workdays, the rules permit employers to request documentation when there is a pattern or clear instance of suspected misuse. Examples include:
- Repeated ESST use immediately before or after scheduled days off, holidays, or vacations;
- Repeated use of small increments of ESST at the beginning or end of shifts; and
- Use of ESST after the employer denied another leave request for the same time period.
The rules also clarify that employers must clearly communicate documentation requirements and provide employees a reasonable opportunity to comply.
Employee Control Over ESST Use
The rules confirm that employees have the right to decide whether to use ESST for a qualifying absence. Employers may not require employees to use ESST. However, if an employee elects not to use available ESST, the absence is not entitled to the protections afforded by the ESST law.
Incentive and Attendance Policies
The rules address the interaction between ESST and incentive programs.
Employers may deny an attendance-based bonus or similar incentive if an employee fails to meet the required objective because of ESST use. However, employers must treat ESST consistently with other forms of leave when applying incentive policies.
Employers Impacted
The rules affect virtually all Minnesota employers subject to the state’s ESST law, particularly employers that:
- Use accrual-based ESST systems;
- Frontload sick and safe time benefits;
- Maintain attendance or incentive programs;
- Require documentation for absences; or
- Employ seasonal, temporary, part-time, or exempt workers.
Employer Takeaway
Minnesota employers should review ESST policies, notices, payroll practices, and attendance procedures to ensure compliance. In particular, employers should verify that:
- Accrual years are properly designated and communicated;
- ESST is credited according to the new timing requirements
- Documentation practices align with the rules;
- Frontloading and advancement procedures comply with the new standards; and
- Existing attendance and incentive programs are administered consistently with ESST requirements.
The new rules provide employers with greater clarity in several key areas but may also require revisions to existing ESST administration practices.