Latest news with #AndrewVonBank
Yahoo
4 days ago
- Business
- Yahoo
Legislature tweaks paid family leave and sick time in minor concessions to businesses
Supporters of paid family and medical leave rally in front of the House Chamber on May 2, 2023. Photo by Andrew VonBank/Minnesota House Info. The narrowly divided Minnesota Legislature passed the smallest of changes to the state's paid family leave program and paid sick leave mandate, rejecting more significant reversals sought by Republicans and some moderate Democrats. House Speaker Lisa Demuth, R-Cold Spring, said failing to make larger changes to the two laws was one of her party's most significant disappointments of the session. 'Those are things that we really wanted to get done … We couldn't find bipartisan agreement,' Demuth said following a marathon one-day special session on Monday. Democrats were largely able to protect their progressive agenda from 2023 even while passing a smaller budget in the face of a gloomy economic forecast. The notable exception is repealing MinnesotaCare for undocumented adults at the end of the year, a key priority for Republicans. Employers and workers may never even notice the change passed to the paid family leave program, which reduces the maximum payroll tax from 1.2% to 1.1%. The program is slated to start next year with a payroll tax of .88%, with employers paying at least half of the cost, and may never rise to meet the cap, depending on demand. The program is slated to start on Jan. 1 with workers eligible to take up to 12 weeks of family leave and 12 weeks of medical leave — or 20 weeks total in a single year. To qualify, workers must have earned at least $3,700 in the past year, with benefits based on a workers' wages up to about $1,400 a week. The changes to the earned sick and safe time law may similarly go unnoticed by the vast majority of workers. The law, which took effect in 2024, will continue to require employers to provide one hour of paid sick leave for every 30 hours worked up to 48 hours a year — i.e., six paid sick days a year for full-time employees. Under the bill, an employer may require an employee to provide documentation — such as a doctor's note — that their earned sick or safe leave is covered after two days, down from three days in current law. The bill adds that a worker may voluntarily find a replacement for a missed shift, but the law will continue to bar employers from requiring workers to find a replacement. The bill also explicitly authorizes a practice that was already permitted but caused some confusion, allowing employers to advance earned sick and safe time to an employee based on the number of hours an employee is expected to work, providing additional time if that estimate falls short. The laws made it through the legislative session mostly unchanged despite a push by moderate Democrats in the Senate to reduce the total number of paid family leave weeks to 14 in a year and carve-out small employers. Moderate Senate Democrats also supported carving out small businesses and farms from the sick time mandate. House Democrats were unified in their opposition to those changes. Rep. Dave Pinto, DFL-St. Paul, said the small changes go further than most Democrats wanted but still maintain the integrity of paid family leave and sick time. 'These are programs that make Minnesotans stronger,' Pinto, co-chair of the House labor committee, said on the floor before passage of the omnibus jobs and workforce bill, which the governor is expected to sign.
Yahoo
21-02-2025
- Business
- Yahoo
Minnesota's paid leave program will launch with 0.88% payroll tax, state agency says
Supporters of paid family and medical leave rally in front of the House Chamber on May 2, 2023. Photo by Andrew VonBank/Minnesota House Info. Minnesota's new paid leave program will launch with a 0.88% payroll tax in January 2026, which is 25% higher than what was originally proposed two years ago when the Legislature passed the law. The Reformer first reported on the need for a higher rate last year, and the Department of Employment and Economic Development confirmed Friday that paid leave remains on track to launch in 2026 with a 0.88% payroll tax. The Democratic-Farmer-Labor trifecta originally passed the bill in 2023 with a 0.7% payroll tax, which is split between workers and employers. The state's paid leave program guarantees Minnesota workers can take 12 weeks of paid family leave and 12 weeks of paid medical leave per year, capped at 20 weeks in a single year. DEED will do rate adjustments each year after receiving an annual actuarial analysis to investigate the solvency of the program. Employees will pay up to half of the payroll tax — 0.44% of their taxable wages in the first year — but an employer can choose to assume some of their employee's cost. Last year, an actuarial analysis conducted by management consulting firm Milliman proposed a 0.88% payroll tax in the first year because 'there is greater uncertainty when the program begins, and additional margin seems prudent when benefits become effective.' The paid leave law states that DEED cannot raise the payroll tax above 1.2%. The Minnesota Legislature in 2023 allocated $668 million from the general fund in seed money so employees can access benefits as soon as they begin paying taxes for them, and the state also kicked in $128 million for start-up costs. The actuarial analysis last year estimated that the new 0.88% payroll tax will bring in over $300 million in additional revenue in the first year compared to the original 0.7% rate. In the first year, they estimated the state will distribute about $1.6 billion in benefits through the program. The analysis estimates that next year the state will receive nearly 132,000 paid leave claims, including over 48,000 in family leave claims and more than 83,000 in medical leave claims. House Republicans, who are currently in control of the lower chamber until a March 11 special election that's expected to lead to shared control, are currently forwarding a bill that would delay the paid leave program by a year. DEED told lawmakers delaying the program another year is unnecessary, but Republicans say businesses need more time to comply. Some school districts have also expressed reservations about the new law. Last year, DFL lawmakers made a clarification to the law that created retroactive payments for both family and medical leave upon confirmation of need. For example, if a person broke their hip, the department will need verification from a health care provider that the person needs leave for at least seven days. After verification, DEED will pay out the first week of leave retroactively. 'In our families, workplaces and communities, Minnesotans take care of each other,' DEED Commissioner Matt Varilek said in a statement. 'But for too many, missing a paycheck to provide care leads to missing rent or not being able to put food on the table. Paid Leave means that Minnesotans no longer have to choose between care for themselves and their families, and their livelihood.'
