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HF2145 (Legislative Session 94 (2025-2026))

Employer misrepresentation and misconduct penalties increased.

Related bill: SF2361

AI Generated Summary

Purpose of the Bill

The bill seeks to increase penalties for employers in Minnesota who misrepresent information related to unemployment benefits or engage in misconduct. The goal is to deter fraudulent activities by employers that negatively affect unemployment benefits and ensure compliance with legal employee classification.

Main Provisions

  1. Increased Penalties for Misrepresentation:

    • Penalties for employers or their representatives who make false statements or fail to disclose material facts to manipulate unemployment benefits will now include a minimum fine of $500, or between 50 to 100 percent of the amount related to the misrepresentation.
    • Situations include helping applicants wrongfully gain benefits, preventing legitimate benefit payments, or avoiding required employer payments.

  2. Subpoena Enforcement:

    • Employers who fail to comply with subpoenas related to unemployment hearings will incur a $500 penalty plus any enforcement costs, including attorney fees.

  3. Employee Misclassification Penalty:

    • Employers not classifying individuals properly as employees, as per specific Minnesota rules, may face additional penalties up to $10,000 per individual misclassified.

  4. Collusion and False Representation:

    • Employers involved in collusion with applicants to fraudulently obtain benefits face penalties of at least $500 or the amount of overpaid benefits, whichever is greater.

  5. Penalty Payment Procedures:

    • Penalties must be paid within 30 days and will be credited either to the trust fund or to the family and medical benefit insurance account.

Significant Changes to Existing Law

  • Increased Financial Penalties: The bill significantly raises the financial stakes for employers who commit fraudulent acts concerning unemployment benefits and employee classification.

  • Clarification of Enforcement Measures: It introduces clear procedures for enforcing penalties and subpoena compliance, ensuring that administrative actions can be effectively pursued.

Relevant Terms

  • Misrepresentation
  • Unemployment benefits fraud
  • Employer misconduct
  • Employee misclassification
  • Subpoena compliance
  • Collusion
  • Administrative penalties

Bill text versions

Actions

DateChamberWhereTypeNameCommittee Name
March 09, 2025HouseFloorActionIntroduction and first reading, referred toWorkforce, Labor, and Economic Development Finance and Policy
March 10, 2025HouseFloorActionAuthor added

Citations

 
[
  {
    "analysis": {
      "added": [
        "Additional penalties for non-compliance with subpoenas issued."
      ],
      "removed": [],
      "summary": "The bill increases penalties for employer misconduct under section 268.184 regarding misrepresentation and failure to disclose.",
      "modified": [
        "Increased monetary penalties for employer misrepresentation and collusion."
      ]
    },
    "citation": "268.184"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "The bill references payment obligations under section 116L.20 regarding penalties for failure to pay required amounts.",
      "modified": [
        "Inclusion in penalty assessment criteria for unpaid employer obligations."
      ]
    },
    "citation": "116L.20"
  },
  {
    "analysis": {
      "added": [
        "A new subdivision increasing penalties for employee misclassification."
      ],
      "removed": [],
      "summary": "Enhancement of penalties for employer misconduct under section 268B.19 for fraudulently received benefits.",
      "modified": [
        "Adjustments to penalty amounts based on overpayments or non-disclosure."
      ]
    },
    "citation": "268B.19"
  }
]

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