HF2567

HF2567 (Legislative Session 94 (2025-2026))

Stay-or-pay provisions made prohibited, unenforceable, and against public policy.

Related bill: SF2533

AI Generated Summary

Purpose of the Bill

This bill aims to amend existing employment law in Minnesota by making certain practices, specifically "stay-or-pay" provisions, illegal and unenforceable. It establishes these practices as contrary to public policy.

Main Provisions

Prohibition of Stay-or-Pay Provisions: The bill specifically addresses and prohibits "stay-or-pay" provisions within employment contracts. These provisions typically require employees to either remain with a company for a designated period or pay a penalty for leaving early.
Unenforceability: Any employment contract including "stay-or-pay" clauses will be considered unenforceable, meaning that such provisions will have no legal effect and cannot be upheld in court.

Significant Changes to Existing Law

Revision of Compliance Orders: The bill amends Minnesota Statutes 2024 section 177.27, subdivision 4, enhancing the authority of the Commissioner of Labor to issue compliance orders against employers who violate labor statutes, including the newly added prohibition of "stay-or-pay" provisions.
Legal Clarification: The modification aligns with broader labor policy by explicitly banning practices that can be deemed coercive or restrictive of employee mobility.

Relevant Terms

Employment
Stay-or-pay provisions
Unenforceable contracts
Labor law
Compliance orders
Employee mobility

Bill text versions

Introduction PDF file

Actions

Date	Chamber	Where	Type	Name	Committee Name
March 19, 2025	House	Floor	Action	Introduction and first reading, referred to	Workforce, Labor, and Economic Development Finance and Policy
March 23, 2025	House	Floor	Action	Author added
March 23, 2025	House	Floor	Action	Author added

Citations

[
  {
    "analysis": {
      "added": [
        "Clarifies objection process for employers contesting orders."
      ],
      "removed": [],
      "summary": "This bill modifies enforcement and compliance orders under section 177.27.",
      "modified": [
        "Revises timeline for employers to contest orders from 30 to 15 calendar days."
      ]
    },
    "citation": "177.27"
  }
]