Minnesota DOLI Issues Final Earned Sick and Safe Time Administrative Rules

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Quick Hits

• Employers with employees in Minnesota must designate and communicate their chosen accrual year for ESST or it defaults to the calendar year.
• Eligibility is based on a “good faith” determination that an employee will work at least eighty hours per year in Minnesota.
• Employees—not employers—control whether ESST is used.
• ESST used for a nonqualifying purpose is not protected and may be subject to discipline in accordance with the employer’s policies.
• Minnesota Paid Leave is excluded from ESST requirements.

These updates are essential to maintaining compliance and managing ESST effectively. Below is a detailed breakdown of what the new administrative rules say and what it means for employers.

Accrual Year

Employers must designate and clearly communicate the accrual year to each employee. If no accrual year is defined, it defaults to the calendar year.

Any changes to the accrual year must be:

• communicated in writing before the change takes effect, consistent with Minnesota’s Wage Theft Law; and
• structured so as to not to negatively impact an employee’s ability to accrue ESST.

Hours Worked and Eligibility

Eligibility: An employee is eligible for ESST based on a “good faith” determinationof whether an employee is anticipated to perform work for at least eighty hours per year in Minnesota. “Good faith” means the employer, at a minimum, evaluated the employee’s anticipated work schedule and location of hours in a way that is not knowingly false or in reckless disregard of the truth.

Determining hours worked for exempt employees: For exempt employees, an employer cannot deduct more ESST than the number of hours for which the employee is deemed to work for accrual purposes when they take a full day of ESST.

Indeterminate shift: For employees with indeterminate shifts (i.e., a shift defined by business needs rather than a specific number of hours), employers must calculate ESST deductions using one of three methods:

• the hours worked by the replacement worker (if any),
• the hours worked by the employee in the most recent similar shift of an indeterminate length, or
• the greatest number of hours worked by a similarly situated employee (if any) who worked the shift for which the employee used ESST.

If an employee uses ESST after beginning a shift of indeterminate length, the employer must use one of the above methods and deduct from the employee’s available ESST the amount associated with the selected option minus the hours already worked by the employee during the shift.

Time Credited and Increments of Accrual

Crediting accrual: ESST must be “credited” (i.e., accrued and available for use) by the regular payday following each corresponding pay period, based on all hours worked. ESST is considered “accrued” when the employer credits the time.

Increment of time accrued: Employers are not required to credit employees with less than hour-unit increments of ESST. For example, an employee who works 120 hours will accrue four hours of ESST (120 ÷ 30 = 4) and will not earn another hour until the employee works another thirty hours.

Rehire: For employees rehired within 180 days, the maximum reinstatement of previously accrued ESST is eighty hours, unless the employer agrees to a higher amount or is otherwise required by law.

Accrual and Advancing Methods

If an employer chooses to “advance” ESST to employees, it must be calculated at no less than the standard rate of one hour of ESST per every thirty hours worked. Employers are not required to advance more than forty-eight hours. However, if the advanced amount falls short of what the employee accrued based on hours worked, the employer must make up the difference within fifteen calendar days of the employee’s actual hours surpassing the anticipated amount.

Changes to accrual methods must be communicated in writing, consistent with Minnesota’s Wage Theft law, and cannot take effect until the first day of the next accrual year. Employers that fail to provide timely written notice must maintain the existing accrual method, unless the employee agrees otherwise.

Importantly, the administrative rules clarify that employers that frontload ESST are not required to also provide accrual—it is one or the other.

Employee Use

Employers cannot require employees to use ESST. The right to use—or not use—ESST belongs to the employee. If an employee chooses not to use ESST, the resulting absence is unprotected.

Incentives

If a bonus, reward, or other incentive is tied to a specified goal such as hours worked, products sold, or perfect attendance, and an employee fails to meet that goal due to ESST use, the incentive may be denied—unless the same incentive is paid to employees on any other type of leave.

Reasonable Documentation

Employees who fail to provide reasonable documentation under Minn. Stat. § 181.9947, subd. 3 are not protected under the ESST law. Employers must clearly communicate any documentation requirement and give employees a reasonable amount of time to provide it.

Misuse of ESST

Misuse of ESST—defined as using ESST for a purpose not covered under Minn. Stat. § 181.9447, subd. 1—is not protected under the law and may be subject to employer discipline.

Notwithstanding the timelines provided in Minn. Stat. § 181.9447, subd. 3(a), employers may require reasonable documentation when there is a pattern or clear instance of suspected misuse by the employee, including when:

• an employee repeatedly uses ESST on their scheduled workday immediately before or after a scheduled day off, vacation, or holiday;
• an employee repeatedly uses ESST in increments of less than thirty minutes at the start or end of a scheduled shift;
• an employee uses ESST on a day for which the employer previously denied the employee’s request to take other paid leave; or
• documentation or other evidence conflicts with the employee’s claimed use of ESST.

Requiring reasonable documentation in these circumstances is not retaliation. However, employers cannot deny an employee’s future use of ESST for a qualifying purpose based only on past misuse or suspicion of misuse.

More Generous Sick and Safe Time Policies

Excess paid time off (PTO): Excess PTO and other paid leave is subject to ESST minimum standards only when the leave is being used for a qualifying ESST purpose.

Minnesota Paid Leave: Minnesota Paid Leave is explicitly excluded from ESST requirements. The rules clarify that Minnesota Paid Leave qualifies as an “other salary continuation benefit,” meaning it is not subject to ESST standards even when used for an ESST-covered reason. Without this distinction, employers would have faced the administrative burden of applying ESST requirements to Minnesota Paid Leave—a complication that has now been avoided.

Ogletree Deakins’ Minneapolis office will continue to monitor developments and will post updates on the Leaves of Absence and Minnesota blogs as additional information becomes available.

In addition, the Ogletree Deakins Client Portal covers legal developments in state and major locality paid sick leave laws, including Minnesota’s Earned Sick and Safe Time requirements, as well as state laws requiring notice of wage and hour changes (as in Minnesota’s Wage Theft Law). Premium-level subscribers have access to comprehensive updated law summaries and policies; Snapshots and Updates are complimentary for all registered client users. For more information on the Client Portal or a Client Portal subscription, please email clientportal@ogletree.com.

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