In 2023, the Minnesota state legislature passed a law establishing a Paid Leave Program (the “Program”) for employers with one or more Minnesota employees, with premium contributions to begin in 2026. In connection with launching the Program, the law requires employers to submit employee wage information to the Minnesota Department of Employment and Economic Development (“DEED”) beginning with the period starting July 1, 2024, and ending September 30, 2024. The first reports are due October 31, 2024. In May of 2024, Minnesota passed a bill amending the law, including a provision allowing for smaller premiums for employers with 30 or fewer employees through an assistance grant. In May of 2024, DEED also released guidance on how to complete Wage Detail Reporting. This article covers highlights of the guidance to assist employers with completing the reporting by October 31, 2024. For more on the Minnesota Paid Leave Program generally, see our blog Minnesota Passes Paid Family and Medical Leave Law.
Who must complete reporting?
All employers with at least one Minnesota employee (not including independent contractors) must submit reporting.
How is reporting completed?
Reporting is completed through the DEED Unemployment Insurance Portal. Employers that are already required to complete MN Unemployment Insurance Reporting can use their existing account to complete paid leave reporting, though the reporting is distinct from Unemployment Insurance Reporting. Employers that are not required to complete Unemployment Insurance Reporting but are subject to Minnesota Paid Leave, must create a “Paid Leave Only” account to complete this reporting. Further guidance on Paid Leave Only accounts is expected in the coming months.
What is included in the Wage Detail Reporting?
Employers will need to provide the first and last name, social security number, wages paid and hours worked for each employee. This is identical to information provided to the Unemployment Insurance division but is a separate reporting requirement.
When are the first wage reports due?
The first Wage Detail Reports will be due on October 31, 2024, and will be based on wages paid between July 1, 2024, and September 30, 2024.
How are “wages” defined for purposes of Wage Detail Reporting?
The definition of “wages” is the same definition used for Unemployment Insurance Reporting under Minn. Stat. 268.35, Subd. 29, and includes: “all compensation for employment, including commissions; bonuses, awards, and prizes; severance payments; standby pay; vacation and holiday pay; back pay as of the date of payment; tips and gratuities paid to an employee by a customer of an employer and accounted for by the employee to the employer; sickness and accident disability payments. . .”. The statute lists several other specific and limited exceptions from the definition of wages (e.g., royalty payments, payments from a trust, reimbursement of expenses, etc.).
Sequoia One PEO Clients: Sequoia One will complete Wage Detail Reporting for clients subject to MN Unemployment Insurance Reporting; no employer action is required.
Employer Action
In advance of the reporting period beginning, employers should do the following to prepare to complete reporting:
- If employer is subject to Minnesota Unemployment Insurance Reporting, ensure access to the requisite DEED account;
- If employer is not otherwise required to complete Minnesota Unemployment Insurance Reporting (but is required to complete Wage Detail Reporting), look out for information from DEED on how to register for a paid leave only account in the coming months.
Resources
- DEED Employers FAQ
- DEED Webpage
- DEED Unemployment Insurance Portal
- Minnesota Paid Family and Medical Leave Law
- Amendment to PFML Law
- Minnesota PFML webpage
- Blog: Minnesota Passes Paid Family and Medical Leave Law
Connect with a Sequoia consultant to learn how Sequoia’s compliance services are integrated in our benefits services and tailored solutions. And if you’re already a Sequoia client, stay on top of your employer obligations with your Compliance Checklist that highlights important compliance dates, action items, and resources.
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