MN Paid Family and Medical Leave Program – What Employers Need to Know

By Published On: July 23, 2025Categories: Businesses, Nonprofits, Tax News, People

Effective January 1, 2026, Minnesota’s new Paid Family and Medical Leave program will go into effect. Administered by the Department of Employment and Economic Development (DEED), this program provides partial wage replacement for a variety of family and medical reasons. To help you stay compliant as an employer, we’ve outlined key features of the upcoming program and provided a starting point for implementation.

Key Features of the Program

  • Up to 12 weeks of paid leave for a serious health condition
  • Up to 12 weeks of paid leave for bonding with a new child, caring for a family member, safety leave, or certain military-related needs
  • A combined annual maximum of 20 weeks
  • Applies to nearly all employees in Minnesota, including part-time, seasonal, and temporary workers
  • Self-employed individuals and independent contractors may opt in

Program Funding and Costs

  • The total premium rate for 2026 is 0.88% of employee wages, capped at the Social Security wage base
  • Employers are responsible for at least 50% of the premium; the remaining portion may be deducted from employees
  • Wage replacement rates vary between 55% and 90% of an employee’s average weekly wage, up to a state-determined cap
  • Payroll deductions begin January 1, 2026
  • First quarterly premiums are due April 30, 2026

Employer Responsibilities

  • Register with the Paid Leave division through your existing UI account
  • Begin withholding employee premiums and contributing the employer share starting January 1, 2026
  • Submit quarterly wage detail reports and pay premiums starting in April 2026
  • Post and distribute required employee notices by December 1, 2025
    • DEED will provide templates
  • Maintain job protections for employees returning from leave
  • Continue employer-sponsored health coverage during an employee’s leave
  • Ensure compliance with anti-retaliation and confidentiality requirements
  • Apply for a private plan exemption, if desired, by demonstrating an equal or better benefit structure

What Employers Should Do Now

  • Begin reviewing your current leave and PTO policies
  • Plan for the financial impact of the premium contributions
  • Ensure your payroll systems can accommodate the required deductions and reporting
  • Designate a point person or team to oversee compliance
  • Register for DEED-hosted webinars and trainings
  • Consider whether a private plan might be a better fit for your business

Upcoming DEED Educational Events for Employers

  • July 28, 2025 (1:00 – 2:30 p.m. CT): Paid Leave Info Session for HR Professionals
  • Ongoing webinars: “Introduction to Paid Leave” held the second Thursday of each month through November 2025

Learn more and find additional DEED Educational Events here: https://mn.gov/deed/paidleave/about/events/