Minnesota Legislative Update: 5 Things Employers Should Know

Minnesota’s legislative session came to a close at the end of May with the passage of a flurry of new bills. Employers may be wondering how some of these new laws will affect their business. There are at least five things every employer should know about these new laws, including how they will affect hiring, paying employees, providing leave to sick employees, and the impact of same-sex marriage on certain leave benefits. Employers should also be aware of certain bills that were not passed this legislative session, but are sure to resurface during the next legislative session.

1. “Ban the Box” Law Prohibits Criminal History Questions Except in Certain Circumstances
The Minnesota legislature passed legislation that prohibits employers from inquiring into or considering the criminal record or criminal history of an applicant until the applicant has been selected for an interview. The law contains some exceptions for when the employer is required by law to consider the criminal history of a potential employee’s background during the hiring process, and will go into effect on January 1, 2014.

2. Increased Opportunity for Employees to Sue Over Payment of Wages
Minnesota Statute §181.13 has been modified to allow an employee to bring a lawsuit to recover payment from an employer even if the employee is not a party to the contract between the employer and the employer’s contracted client. This legislative change reverses the legal precedent established last year by the Minnesota Supreme Court in Caldas v. Affordable Granite & Stone, in which the Court upheld a favorable ruling obtained by Seaton, Peters & Revnew, P.A. in 2010 for Affordable Granite & Stone. The Caldas Court held that tile workers hired to repair tiling at the Minneapolis Convention Center were not third-party beneficiaries to the contract at issue that established the prevailing wage and therefore could not bring a direct action against the contractor under Minn. Stat. 181.13.

3. Use of Sick Leave Expanded
Effective August 1, 2013 employers with 21 or more employees who provide sick leave benefits must allow their employees to utilize sick leave to care for an adult child, spouse, sibling, parent, grandparent or stepparent. Previously the law only required that employees be allowed to use their sick leave benefits for the employee or his or her minor children. Employers who provide sick leave benefits should anticipate greater levels of utilization of those leave benefits and will need to modify their policies to allow employees to use sick leave under this expanded list of circumstances.

4. 52 Weeks of Unemployment Benefits During Management Lockout
Employees locked out by management in connection with a labor dispute are now entitled to an additional 26 weeks of unemployment insurance benefits in addition to the 26 weeks of unemployment benefits that employees currently receive.

5. Same-Sex Marriage Will Have an Impact on Certain State and Private Benefit Plans
Beginning on August 1, 2013, the definition of marriage will be defined as a “civil contract between two persons” thereby removing the law’s previous requirement that marriage be entered into between members of the opposite sex. While this change in the definition of “spouse” to include same-sex individuals will certainly have a broadening effect on who is covered under employer-sponsored benefits and state-run policies, it may not have as great an impact on Minnesota current leave policies. With the exception of the expansion of the sick leave law discussed above, Minnesota’s various leave laws, including the Parental Leave Act, largely provide leave based on the individual’s status as a parent. With regard to federal laws, the Defense of Marriage Act (DOMA) bans federal recognition of same-sex marriage, and as a result, Minnesota’s same-sex marriage law will not impact the definition of “spouse” under the Family Medical Leave Act (FMLA) or any Employee Retirement Income Security Act (ERISA) benefit plans.

What Did Not Pass But May Return Next Legislative Session

The following bills relating to employment did not become law:

• A House bill invalidating non-compete agreements
• Bills in both the House and Senate increasing the minimum wage
• A House bill prohibiting discrimination based on unemployment status
• House and Senate bills requiring greater pregnancy leave and accommodations

Heading into the next legislative session, employers should expect to see a number of these unresolved bills return, including the minimum wage and pregnancy leave bills.

If you want to learn more about how these and other new laws might affect your own business, please join Martin Kappenman and Jessica Hofrichter for a one-hour webinar, Minnesota’s New Laws: Tips and Strategies for Employers on June 19th for an in-depth discussion of the new legislation, along with strategies to address these new issues.

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