SF4697

Purpose

This bill changes who is covered by Minnesota’s Paid Leave framework by exempting certain elected officials from the paid leave requirements. It also clarifies who counts as an “employee” and how “covered employment” is determined, with the option for some previously excluded entities to choose coverage.

Main Provisions

• Defines covered employment so that an employee’s entire calendar-year work is considered covered if at least 50% of the work is performed in Minnesota, or if 50%+ of the work isn’t in Minnesota or in a single state but the employee’s residence is in Minnesota for at least half the year.
• Excludes certain groups from covered employment:
  • self-employed individuals
  • independent contractors
  • seasonal employees
  • employees of the state or a political subdivision who are elected officials, members of a legislative body, or members of the judiciary
• Allows excluded entities to opt in to coverage following a process set by the commissioner; if they opt in, their employees’ services become covered employment.
• The commissioner may adopt rules to further define how covered employment applies, including criteria for individuals who don’t meet the standard criteria but work as employees for Minnesota employers.
• Defines employee as a person who performs services for an employer, and explicitly excludes:
  • employees of the United States
  • self-employed individuals
  • independent contractors
  • seasonal employees
  • state or political subdivision employees who are elected officials, members of a legislative body, or members of the judiciary

Changes to Existing Law

• Rewrites the definitions of “covered employment” and “employee” in Minnesota Statutes 2024, section 268B.01, to add explicit exemptions for elected officials and related officials at the state or subdivision level.
• Introduces an opt-in mechanism for entities that are currently excluded from coverage to voluntarily join the Paid Leave framework.
• Grants the state’s commissioner authority to issue rules to clarify and extend coverage as needed.

Scope and Practical Impact

• Elected officials at the state or political subdivision level (and members of legislative bodies or the judiciary) would be exempt from Minnesota’s Paid Leave coverage.
• Independent contractors, self-employed individuals, and seasonal workers remain excluded unless an entity opts in.
• Some employers previously outside the paid leave coverage could choose to participate, expanding coverage to their employees if the opt-in path is used.
• For workers who are not in the explicitly excluded categories, their status as “employee” and whether their work qualifies as “covered employment” could determine eligibility for paid leave benefits under the law.

Rationale (implied)

• The bill aims to tighten who must adhere to paid leave requirements by drawing clearer lines around elected officials and certain other roles, while giving a pathway for broader coverage if entities choose to opt in.

Relevant Terms - Minnesota Paid Leave Law - covered employment - employee - elected official - state government - political subdivision - member of a legislative body - member of the judiciary - self-employed - independent contractor - seasonal employee - opt in / opt-in - commissioner - rules (chapter 14)