HF4494

Purpose

• Create a Small Employer Assistance Grants program to help certain small employers manage costs related to employee family or medical leave. The grants are intended to support hiring temporary workers or increasing wages for current employees when a worker takes leave.

Main Provisions

• Eligible employers:
  • Have 30 or fewer employees (as calculated under Minnesota Statutes section 268B.14, subdivision 5b).
  • Have an average wage that is less than or equal to 150 percent of Minnesota’s state average wage in covered employment for the prior year.
  • Apply to the state department for a grant.
• Grant details:
  • Up to $3,000 per grant is available if the employer hires a temporary worker or increases wages to substitute for an employee on family or medical leave for seven days or more.
  • The maximum total grant per eligible employer per calendar year is $6,000.
  • Grants must be used to hire temporary workers or to increase wages for current employees.
• Eligibility documentation:
  • Employers must attest in a prescribed form that:
  • The temporary worker hired or wage-related costs are due to an employee’s use of leave under this chapter.
  • The grant amount requested is less than or equal to the additional costs incurred.
  • The employer meets the revenue requirements described in the section.
• Application process:
  • Applications are submitted and processed in a form and manner determined by the commissioner within each calendar year until funding is exhausted.
  • Applications received after funding is exhausted are not eligible.
• Private leave plan rule:
  • An employer that already has an approved private paid leave plan is not eligible to receive a grant under this section.
• Funding source and annual cap:
  • Grants may be awarded up to a maximum of $5,000,000 per calendar year from the family and medical benefit insurance account, unless additional funds are appropriated.

Significant Changes to Existing Law

• Adds a new Small Employer Assistance Grants program to Minnesota Statutes 268B.29, establishing eligibility criteria, grant amounts, uses, and application rules.
• Introduces a disqualification for employers with an approved private paid leave plan.
• Specifies a funding cap and source (family and medical benefit insurance account) and ties grant availability to annual appropriations and funding availability.

Practical Implications

• Helps small employers manage short-term leave-related costs without increasing permanent payrolls.
• Encourages temporary staffing or wage increases to cover for employees on leave in small businesses.
• Creates a formal process and annual funding limit, which may influence hiring decisions and leave planning for eligible small employers.

Important Notes

• The program is limited by annual funding and may exhaust early in the year.
• The grant is specifically tied to seven days of leave or more and to costs arising from that leave.
• Employers with private paid leave plans should not expect to receive these grants.

Relevant Terms - Small Employer Assistance Grants - small employer (30 or fewer employees) - 150 percent of state average wage - private paid leave plan - temporary worker - wage increase - substitute for an employee on family or medical leave - seven days or more - grant up to $3,000 - maximum grant per employer per year: $6,000 - documentation attestation - revenue requirements - private plan disqualification - family and medical benefit insurance account - annual funding cap: $5,000,000 per calendar year - funding exhausted (calendar year)