Minnesota Legislative Update 2024, Part III: Entering the Homestretch—Legislators’ Time to Make It or Break It

Quick Hits

• Minnesota lawmakers are attempting to secure enough votes ahead of this year’s legislative session deadline to place numerous bills on the governor’s desk, many of which, if enacted, will affect employers.
• Bills address drug testing, earned sick and safe time, pay transparency in job postings, wage deductions for credit card charges for tipped employees, restrictive employment covenants in service contracts, and employee misclassification.
• Senate Democrats have a one-vote majority, so some legislation may be endangered due to Republican calls for expulsion of a Democratic senator who was charged with first-degree burglary.

In our April 16, 2024, legislative update article, we previewed two omnibus bills which include provisions that, if enacted, will affect Minnesota employers. Since then, the two omnibus bills have seen a flurry of activity, including bundling of other bills to ensure they land on Governor Tim Walz’s desk.

Omnibus Budget and Policy Bills

Senate File (SF) 3852 / House File (HF) 3947

Status: As previously reported, the Minnesota Senate and House conferred a conference committee to compromise on the text of omnibus bill because the companion bills were not identical. The conference committee reached an agreement on the text of the bill and adopted a conference committee report on April 30, 2024. The conference committee will transmit its report to the Senate for consideration. If the Senate adopts the report and re-passes the omnibus bill, then the House gets to consider the same.

Key Provisions to Watch

Changes to DATWA. This omnibus bill would modify the Drug and Alcohol Testing in the Workplace Act (DATWA) by:

• defining “oral fluid test” and clarifying that saliva testing to detect drugs, alcohol, cannabis, or their metabolites does not require the services of a testing laboratory;
• allowing employers to use oral fluid testing procedures as an alternative to drug and alcohol or cannabis testing for job applicants; and
• allowing an employer to request or require an oral fluid drug, alcohol, or cannabis test and allowing an employee or job applicant to request a drug, alcohol, or cannabis test at no cost to the employee or applicant using a testing lab within forty-eight hours of a test result that is positive, inconclusive, or invalid to remain eligible for the position. Current rights, notice, and retest procedures would apply to such testing.

Salary ranges required in job postings. The omnibus bill includes HF 3587 and SF 3725 which would require employers, of thirty or more employees, to disclose the “starting salary range, and a general description of all of the benefits and other compensation to be offered to a hired job applicant” in job postings. An employer that does not plan to offer a salary range for a position would be required to list a fixed pay rate.

Wage deductions for credit card charges modified. The omnibus bill includes HF 4787 and SF 4709, which would require the full gratuity included in a credit card or electronic payment to be paid in full to the employee in the pay period when they received it. The current law allows an employer to deduct part of the gratuity to cover the charge from a credit card service company.

Restrictive employment covenants void in service contracts. This omnibus includes HF 3456 and SF 3721, which would bar staffing agencies or similar entities in Minnesota from restricting their employees from directly working for their customers.

HF 5217 / SF 5266

Status: This omnibus bill and HF 4194 / SF 4158 merged with HF 5242 / SF 5284 to create one housing, labor, and transportation budget bill package.

Key Provisions to Watch

Minnesota Earned Sick and Safe Time (ESST). This omnibus bill would modify the ESST law by:

• providing rulemaking authority to the Minnesota Department of Labor and Industry’s commissioner to carry out the ESST law;
• providing remedies available as enforcement against employers that do not follow ESST requirements and setting damages as the full amount of ESST time not provided or allowed to be used, in addition to an amount equal to that amount as liquidated damages;
• removing certain ESST earning statement (pay stub) requirements;
• modifying notice requirements to employees regarding their use and accumulation of ESST;
• allowing employees to use ESST for bereavement to arrange for or attend a funeral or memorial, or address financial or legal matters following the death of a family member; and
• allowing employees to use ESST in the same increment of time as they are paid; provided, however, an employer is not required to allow leave increments of less than fifteen minutes and cannot require employees to use ESST in increments over four hours.

Review of personnel records by employees. Also included in this omnibus bill is a provision that would modify the definition of “employer” to include employers that employ one or more employees for purposes of review and access to personnel records for private sector employees.

Misclassification of employees and construction employees. The omnibus bill includes HF 4444 and SF 4483 which would amend misclassification provisions; provide additional penalties and enforcement of misclassification of employees and construction employees; and establish a new multipart independent contractor test for building construction and improvement services.

Senator’s Arrest Threatens DFL’s Slim Majority

Senator Nicole Mitchell, a member of the Democratic–Farmer–Labor (DFL) Party who represents Minnesota’s District 47, was charged with first-degree burglary last week. Senator Mitchell allegedly broke into her stepmother’s home to retrieve some of her late father’s belongings. Senate Republicans filed an ethics complaint against Senator Mitchell and called for her resignation or expulsion after her arrest. Senator Mitchell has been removed from committee assignments and caucus meetings while both a Senate and criminal investigation play out. The Democrats hold a one-vote majority in the Senate and need Senator Mitchell’s vote to successfully pass proposed legislation without bipartisan support.

Ogletree Deakins’ Minneapolis office will continue to monitor developments and will publish updates on the Minnesota blog as additional information becomes available.

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