Key Takeaways
Impacted Employers: Minnesota employers
Effective Date: July 6, 2026
Summary: Minnesota has published regulations clarifying and defining various aspects of the state’s law entitling employees to earned sick and safe time (ESST).
Next Steps: Review ESST policies, payroll accrual practices, rehire procedures, documentation requirements, and manager training to help comply with the final rules. More detailed next steps can be found below.
The Details
While many of the final rules clarify existing statutory requirements, they provide employers with important guidance on employee eligibility determinations, accrual administration, frontloading practices, documentation requests, suspected misuse, incentive programs, and treatment of employees with irregular or indeterminate schedules.
The rules also address incentive programs, employees who work indeterminate shifts, and employers that provide leave benefits exceeding the state's minimum ESST requirements.
The following is a brief overview of the final rules.
Accrual Year
Under the final rules, if an employer fails to designate and clearly communicate the accrual year to each employee, the accrual year is a calendar year.
An employer must provide notice of a change to the start and end dates of an accrual year as part of the written notice of changes to employment terms required under state law prior to the date the change takes effect. A change to the start and end dates of an accrual year mustn’t negatively impact an employee's ability to accrue ESST.
Employee Eligibility Determinations
An employer must determine in good faith whether an employee is anticipated to perform work for at least 80 hours in a year for that employer in Minnesota.
For the purposes of this requirement, "good faith" means the employer, at a minimum, evaluated the employee's anticipated work schedule and location of hours worked in a manner that is not knowingly false or in reckless disregard of the truth. Employees anticipated to work or who actually work at least 80 hours in a year for that employer in Minnesota must receive ESST in accordance with the law.
Calculation of Hours Worked
The determination of hours worked will be governed by the provisions in Minnesota Administrative Rules Section 5200.0120 and Section 5200.0121.
For an employee exempt from overtime requirements, who uses ESST for an absence of a full workday, the employer is prohibited from deducting more ESST than the number of hours for which the employee is deemed to work for the purposes of accruing ESST each workday.
Indeterminate Shifts
The final rules also provide guidance for employees who work shifts of an indeterminate length, such as shifts that depend on business needs rather than a fixed number of scheduled hours. When an employee uses ESST for an absence from such a shift, an employer may deduct ESST using only one of the following methods:
- The number of hours worked by the replacement worker, if any;
- The number of hours worked by the employee during the most recent similar indeterminate shift; or
- The greatest number of hours worked by a similarly situated employee who worked the shift.
If the employee begins an indeterminate shift and then uses ESST for the remainder of the shift, the employer must reduce the ESST deduction by the number of hours the employee already worked.
Accrual Crediting
Under the final rules, ESST must be credited to an employee for each pay period based on all hours worked no later than the regular payday after the end of each corresponding pay period. ESST time is considered accrued when the employer credits the time to the employee.
An employer isn’t required to credit employees with less than hour-unit increments of ESST.
Rehires
An employee rehired by the same employer within 180 days of the employee's separation is entitled to a maximum reinstatement of 80 hours of previously accrued but unused ESST, unless the employer agrees to a higher amount or an applicable statute, regulation, rule, ordinance, policy, contract, or other legal authority requires a greater amount.
Frontloading
When an employer frontloads or advances ESST to an employee for the remainder of the accrual year:
- The advanced amount must be calculated at no less than the rate required by law.
- Employers are not required to advance more than 48 hours of ESST unless another legal requirement applies.
- If the advanced amount is less than the amount the employee would have accrued based on actual hours worked, the employer must provide additional ESST within 15 calendar days after the employee exceeds the anticipated hours worked.
Changing Methods
Any change to an employer's method of providing ESST must be communicated to the employee in writing and isn’t effective until the first day of the next accrual year.
An employer must provide notice of a change to the accrual method as part of the written notice of changes to employment terms under Minnesota law. If an employer fails to provide timely notice, the prior accrual method remains in effect, unless the employee agrees otherwise.
Employee Use
The final rules make clear that employers are prohibited from requiring an employee to use ESST. Employees have the right to choose whether to use ESST for a qualifying purpose. The rules state that when an employee requests not to use ESST for an absence, that leave isn’t subject to ESST's statutory protections.
Documentation
If the employer is permitted to require reasonable documentation under the law and intends to enforce such a requirement, the requirement must be clearly communicated to the employee, and the employee must be given a reasonable amount of time to provide the reasonable documentation.
Misuse
The final rules define misuse as when an employee uses ESST for a purpose not covered by the law. Misuse isn’t covered by the protections for ESST. Misuse may be subject to employer discipline.*
An employer is permitted to require reasonable documentation from an employee when there is a pattern or clear instance of suspected misuse. Under the final rules, a pattern or clear instance of suspected misuse includes, but is not limited to:
- An employee repeatedly used ESST on their scheduled workday immediately before or after a scheduled day off, vacation, or holiday;
- An employee repeatedly used increments of ESST of less than 30 minutes at the start or end of a scheduled shift;
- An employee used ESST on a day for which the employer previously denied the employee's request to take other paid leave; or
- Documentation or other evidence that conflicts with the employee's claimed use of ESST.
Employers are prohibited from denying an employee the use of ESST for a qualifying purpose based on previous misuse of or the employer's suspicion that the employee may misuse ESST.
* Employers should consult legal counsel before disciplining an employee for misuse of ESST.
Incentives and Attendance Programs
The final rules clarify how ESST may affect attendance-based bonuses, rewards, and other workplace incentives. If a bonus, reward, or incentive is tied to achieving a specified goal, such as hours worked, products sold, or perfect attendance, an employer may deny the incentive when an employee fails to meet the goal because of ESST use. However, an employer is prohibited from treating employees who use ESST less favorably than employees on other forms of leave when administering incentive programs.
More Generous Employer Leave Policies
The final rules recognize that employers may provide paid leave benefits that are more generous than the minimum ESST requirements. However, when an employer chooses to satisfy its ESST obligations through a broader paid time off or leave policy, the portion of leave used to meet Minnesota's ESST requirements remains subject to the law's standards and protections.
Next Steps
- Confirm how your organization defines and communicates its accrual year.
- Verify employee eligibility determinations are made in good faith using anticipated schedules and Minnesota work locations.
- Ensure ESST accrues based on all applicable hours worked.
- Review payroll processes to ensure accrued ESST is credited no later than the regular payday after each pay period.
- Verify tracking of rehired employees and reinstatement of eligible ESST balances.
- Update documentation request procedures.
- Train managers on misuse standards and documentation rules.
- Make sure employees are not required to use ESST.