Minneapolis is First City in Minnesota to Require Employers to Provide Paid Sick Leave

This year Minneapolis became the first city in Minnesota (and likely not the last) to require that certain employers provide paid sick leave to covered employees.  The Minneapolis Sick and Safe Time Ordinance (“Ordinance”) goes into effect on July 1, 2017, falling in line with a new national trend whereby cities are mandating employers to provide employees within the city’s jurisdiction with paid sick leave.  Below are some basic questions clients have been asking and some general information about the Ordinance.

But My Business is not in Minneapolis.  Why Should I Care?  The Ordinance is not dependent on where an employer is located. Rather, it is invoked based on where an employee is scheduled to work. Therefore, the Ordinance affects employers with employees working in the City of Minneapolis, regardless of where the employer might actually be located.  In other words, if you have, or plan to have, employees working in Minneapolis, the Ordinance must be taken into account.

What Employers are Affected?  Unless an exception applies (as noted below), the Ordinance applies to all employers in Minnesota with “covered employees.”  Employers with at least six (6) employees must provide paid sick and safe time leave to its “covered employees.”  Employers with fewer than six (6) employees, must still provide sick and safe time to covered employees, except that it would be unpaid.

To determine if an employee is a “covered employee”, employers must add up the number of hours the employee worked in the City of Minneapolis during the calendar year.  If those hours equal or exceed eighty (80), then the employee is a “covered employee.”  Note that the Ordinance makes no distinction between full-time, part-time, temporary, exempt or non-exempt employees.

Are there any Exemptions?  There are some general exemptions as noted below:

  • Federal, state, county, or local government. Employers that are also a federal, state, county or local government are not required to comply with the Ordinance.
  • Independent Contractors.
  • Construction Exemption. Employers with construction industry employees are exempt from the Ordinance’s requirements if they pay the covered employee at least the prevailing wage rate or at least the required rate established in an applicable apprenticeship agreement for apprentices.  As with any prevailing wage project, employers are advised to carefully document they are paying a covered employee appropriately in order to find itself in a defensible position in case the employer is challenged.
  • Policies that Meet or Exceed the Ordinance’s Minimum Requirements. The Ordinance also provides an exemption for employers who provide employees with paid sick time under a separate leave policy that meets or exceeds the Ordinance’s minimum requirements.  However, other than the Ordinance itself, the City has provided no guidance or examples of an exempt policy.  As with other laws providing protected leave (such as the FMLA), employers should be mindful that even seemingly minor conflicts could result in an argument that the separate policy fails to meet this high standard. Consequently, employers crafting their own paid sick leave policy should consult with legal counsel for an opinion on whether such a policy could arguably be exempt from the Ordinance.

How Much Sick Time Do Employees Earn?  The Ordinance requires that covered employees receive one (1) hour of sick time for every thirty (30) hours worked, with new employees having access to the time after ninety (90) calendar days of employment.  Although employees can carry over earned but unused time to the next calendar year, the Ordinance allows employers the discretion to:

  • cap the accrual of paid sick time at forty eight (48) hours in one calendar or fiscal year; and
  • cap the total accrual bank at eighty (80) hours.

What Happens if an Employee Quits or is Terminated?  As is generally the case in Minnesota, employers are not required to pay out earned but unused time upon employment separation, but may do so if they choose. Unique to this Ordinance, however, is a requirement that an employee rehired within ninety (90) days of separation be credited his/her previously earned and unused sick time. As a note of caution, employers should consult with legal counsel for consistency in relation to existing policies and practices on how it currently handles payment of earned but unused paid time off upon a termination event.

How Can Employees Use the Time? Under the new Ordinance, employees can use their paid sick time for any of the following:

  • the employee’s own mental and physical illness, injury, health conditions, diagnostic or preventive care,
  • to care for a qualifying family member with similar needs as noted above;
  • to deal with domestic abuse, sexual assault, or stalking that affects the employee or the employee’s family members; and
  • to care for a family member whose school or place of care is closed due to inclement weather or other unexpected closure.

When an employee’s use of paid sick time under the Ordinance is foreseeable, the employer may require up to seven (7) days’ advance notice.  Further, employers may also require employees to provide pertinent documentation to substantiate absences of more than three (3) consecutive days.

Are there any Notice or Posting Requirements? The Minneapolis Department of Civil Rights is in the process of creating a poster that employers must display in a conspicuous place accessible to its employees.  In addition to the poster, employers with an employee handbook are required to create a policy informing employees of their rights and remedies under the Ordinance.  Consequently, employers must revisit, and if necessary revise, its employee handbook for compliance.

The Ordinance is extremely nuanced and this article only highlights what employers should become immediately aware of while preparing for its implementation. There are several other questions that employers might have that need to be addressed, such as, are there any record keeping requirements, what about employee transfer policies, and how to handle an employee’s request for earned time. Therefore, even though the Ordinance’s implementation is several months away, there is no better time than now to consult with the employment attorneys at Rinke Noonan for further guidance on how the Ordinance affects your business and what needs to be done in advance of its arrival.

© 2016 Rinke Noonan

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