In 2026, Minnesota is implementing a series of major workforce-related policy changes aimed at expanding worker protections and benefits. Key among these are updates to the Earned Sick and Safe Time (ESST) law, the launch of the Minnesota Paid Leave program, and the introduction of the Minnesota Secure Choice Retirement Program, which requires certain employers to offer employees access to retirement savings plans.
These initiatives are part of a broader effort to ensure workers have access to paid leave, financial security and clear workplace rights — while also creating new compliance responsibilities for Minnesota employers.
Key Minnesota HR changes in 2026
Minnesota Paid Leave
This program provides workers with paid time off for family and medical reasons. Eligible employees — including full-time, part-time and many temporary workers — can take up to 12 weeks of medical leave for their own serious health conditions and 12 weeks of family leave to care for a new child, a sick family member or for safety-related reasons. Combined, the maximum leave is 20 weeks per year. While on leave, workers receive partial wage replacement, ranging from 55% to 90% of their usual pay, with benefits capped around the state’s average weekly wage. Job protection applies after 90 days of employment, and employers generally must continue health insurance coverage during leave.
The program is funded by a payroll tax of 0.88% of wages, split evenly between employers and employees, with reduced rates available for small employers. Employers must start withholding premiums beginning Jan. 1, 2026, and make their first premium payments by April 30, 2026. The program is run by Minnesota’s Department of Employment and Economic Development and covers most employees in the state, with opt-in options for self-employed and independent contractors.
All employees must be notified of their rights and benefits under PFML by Dec. 1, 2025. Notification must be in the employee’s native language, and a workplace poster must be displayed in English or any language spoken by five more employees. Employees must acknowledge that they have received the information by signing a form.
For those working for or advising small businesses, remember that employers with fewer than 30 employees and the average wage is less than 150% of the statewide average weekly rate qualify for a reduced premium rate of .22%. The employee contribution maximum remains the same at .44%.
Earned Sick and Safe Time
This program mandates that employers provide paid leave to employees for various reasons, including personal or family illness, medical appointments and situations related to domestic abuse, sexual assault or stalking. Starting Jan. 1, 2026, employees accrue one hour of sick and safe time for every 30 hours worked, up to a maximum of 48 hours per year, unless the employer offers a higher amount. Unused hours can be carried over into the next year, with a cap of 80 hours. Employers are required to pay employees at their base rate during ESST usage.
Recent updates to the ESST law, effective July 1, 2025, include modifications to notice and documentation requirements. Employers can now require employees to provide notice of ESST usage "as reasonably required by the employer" for unforeseeable absences. Additionally, employers may request reasonable documentation for absences exceeding two consecutive scheduled workdays. The law also clarifies that while employers cannot require employees to find replacement workers, employees may voluntarily trade shifts to cover their ESST hours. Furthermore, starting Jan. 1, 2026, employers are permitted to advance ESST hours to new employees based on anticipated hours worked, with reconciliation required to ensure accurate accrual.
Minnesota Secure Choice Retirement Program
This is a state-sponsored initiative designed to help private-sector employees without access to employer-sponsored retirement plans save for their future. Employers with five or more employees who do not offer a retirement plan are required to enroll in the program, which facilitates automatic payroll deductions into individual retirement accounts (IRAs) for participating employees. Employees have the option to contribute to a Roth IRA on an after-tax basis or a traditional IRA on a pre-tax basis, with the flexibility to adjust their contribution rates or opt out entirely.
The program launches Jan. 1, 2026, with employers given time to enroll and begin payroll deductions. Phased requirements follow based on company size. The contribution rate is proposed at 5% of an employee's pay, with automatic annual increases of 1% until it reaches 8%. Employees can direct their contributions into a diversified array of investment funds offered through the State Board of Investment.
Minnesota Secure Choice Retirement Program Employer Enrollment Phases
| Number of employees at the covered employer |
Phase duration |
| Soft launch for covered employers |
Jan. 1, 2026, to March 30, 2026 |
| 100 or more |
April 1, 2026, to June 30, 2026 |
| 50 to 99 |
July 1, 2026, to Dec. 31, 2026 |
| 25 to 49 |
Jan. 1, 2027, to June 30, 2027 |
| 10 to 24 |
July 1, 202,7 to Dec. 31, 2027 |
| 5 to 9 |
Jan. 1, 2028, to June 30, 2028 |
