A state-administered Paid Family and Medical Leave (PFML) program was signed into law by Governor Walz in May 2023. PFML allow nonprofits to be competitive employers, all Minnesotans to take time off to care for themselves and their families, boost the economy, and advance racial equity.
PFML benefits and premiums start January 1, 2026.
PFML launches soon; immediate actions needed for employers
Set up your accounts and designate a Paid Leave Administrator
The most important thing to do today is to get your accounts ready for Paid Leave. You will need your Employer Account (at uimn.org) and a Paid Leave Administrator Account (at paidleave.mn.gov).
Log in to your Employer Account at uimn.org to designate a Paid Leave Administrator. This person will be your organization’s main contact with the Paid Leave division. You can designate one person or several people, depending on what works for your business. You can find a step-by-step guide at uimn.org/employers/paid-leave.
After you designate an Administrator, go to paidleave.mn.gov to create your Paid Leave Administrator Account. You will need this account to review leave applications, view Paid Leave determinations, and more.
For more information about how to prepare and tools to help, visit mn.gov/deed/paidleave/employers/prepare.
Notify your employees
Under Paid Leave, you must notify your employees about Paid Leave in two ways:
- A workplace poster (PDF), displayed in English and any other language spoken by five or more employees or independent contractors.
- An individual notice (Word Doc) in the employee’s primary language.
When the program begins, employers must give this notice by December 1, 2025. Employees must acknowledge that they received the notice, or you must be able to demonstrate how they were notified.
You can review the poster and sample notices on DEED’s website and make plans to deliver them to your employees.
Set workplace policies
Make decisions now about how PFML will work in your organization, including:
- Decide how to split premiums: Employers must cover at least 50 percent of premium costs, but you can choose to cover more. Calculate premiums for when the program launches on DEED’s premiums webpage.
- Set up a clear notification process: Employees must tell you before applying to Paid Leave. Decide who they will notify and how.
- Decide whether to allow supplemental payments: Paid Leave only replaces part of an employee’s wages. As an employer, you decide whether to allow certain other benefits – including vacation and sick time – to “top off” payments from the program. If you allow it, employees can choose to use these supplemental payments to make up the difference between Paid Leave and their regular wages while on leave. If you decide not to allow supplemental payments, employees who want to receive their full, usual wage while on leave need to use their vacation, sick time, or other paid time off instead of Paid Leave.
- Set up your intermittent leave policy: Employees can take leave in small blocks of time rather than all at once. This is called intermittent leave. You decide the shortest block of time an employee can use – from one minute up to one day. You can also decide how much leave time can be taken as intermittent leave. Employees can take up to 480 hours of leave intermittently each year if they qualify (the equivalent of 12 weeks at 40 hours per week). If someone qualifies to take up to the maximum 20 weeks of leave in a year, you can decide if that additional time can also be taken intermittently, or if it must be taken in one continuous block.
Attend a DEED Paid Leave public engagement event
How does PFML work?
PFML will provide job protections for all workers, and begins January 1, 2026. Current access to paid time off is not evenly distributed, with significant disparities based on race, income, geography, and employer size in MN.
PFML provides up to 20 weeks per year for medical and family leave. Medical leave includes time to care for oneself with a serious health condition, including pregnancy, and family leave includes taking time to care for a loved one including bonding with a new child.
PFML would keep costs low
for all by creating a large
statewide risk pool where employees and employers equally share the premium rate of 0.88 percent. The premium rate is a percentage of an employee’s wages.
How to calculate premiums
Minnesota Paid Leave confirmed the premium rate of 0.88 percent. The premium rate is a percentage of an employee’s wages that will be paid by the employee and their employer to fund the program.
This calculator tool helps employers and employees estimate their premium cost.
The first premium payments for Paid Leave are due on April 30, 2026. The first premiums will be based on wage detail reported between January 1, 2026, and March 31, 2026. Employers may deduct the employee portion of Paid Leave premiums from paychecks starting January 1, 2026, when benefits become available.
After the first year in 2026, the premium rate will be set annually no later than July 31 for the following year. The premium will be based on how the program is running, and best budgeting practices to keep the fund at a healthy level. The premium rate cannot exceed the maximum rate set in state law.
For more information on Paid Leave premium rates and contributions, visit the Minnesota Paid Leave website and sign up for email updates from Paid Leave.
Paid Family and Medical Leave FAQ
What is Paid Family and Medical Leave (PFML)?
PFML is a new social insurance program administered by the Department of Employment and Economic Development (DEED) that would provide a partial wage replacement benefit and a leave entitlement for workers who are unable to work because they have a serious medical condition, they are taking care of a family member with serious medical condition, they are bonding with a new child, or they have a family member in the military being deployed.
For how long can employees take leave?
Employees are eligible for up to 20 weeks of medical leave and family leave each year. Employees are capped at 12 weeks for each leave meaning if an employee takes 12 weeks of medical leave, they will only be able to take 8 weeks of family leave and vice versa. However, they can only take leave for the duration for which they are eligible under the program requirements.
In other states, employees typically take 6-8 weeks depending on the type of leave. Employees usually only take more than 12 weeks if they need medical leave because of a pregnancy complication followed by bonding leave. Because the benefit is a partial wage replacement, employees are incentivized to return to work as soon as they are able.
How is it paid for?
PFML is paid for by a 0.88% payroll premium to be split between the employer and employee.
- For an employee making $52,000 per year this amounts to $4.40 per week
- For a nonprofit organization with a $1 million payroll this amounts to just under $85 per week
The payroll premium is paid to DEED and when a worker needs the leave, they apply to DEED who pays out the partial wage replacement benefit. The employer is only responsible for their portion of the payroll premium, the benefit itself is paid for by DEED.
This calculator tool helps employers and employees estimate their premium cost.
Who is covered under the program?
The final legislation includes all employees except for seasonal employees.
Seasonal employees include an individual who is not employed for more than 150 days in a 52-week period in the hospitality industry and the employer must:
- Make 2/3 revenues in 6 months of the year,
- Must apply to DEED to be seasonal
- Notify employee of seasonal status
Private employers, public sector employers, and nonprofit organizations are all covered under the program. Self-employed individuals may voluntarily participate in the program by opting in and paying a 0.7 percent premium.
When will PFML begin?
The program will begin January 1, 2026. Although passed into law in 2023, the two-and-a-half-year period is needed for DEED to build the requisite administrative infrastructure and perform outreach to employers and employees to prepare them for the program.
The premiums would also begin to be collected on a quarterly basis starting January 1, 2026. This calculator tool helps employers and employees estimate their premium cost.
Employer FAQ
How will the PMFL program help my organization plan for employee leave?
When an employee takes leave on behalf of PFML, the organization has already contributed regularly towards their wage replacement, and the employer would not have to pay the employee during their leave.
Because the employee would be receiving a percentage of their salary directly from the state, the employer would have the flexibility to hire temporary or contracted support, or use the funds already budgeted to pay the employee on leave to make critical business decisions.
Minnesota Paid Leave: Employer Q&A
Do all employers need to participate?
Employers can provide their own comparable program by applying to DEED for a “private plan exemption.” This requires employers to cover all of their employees with a PFML plan that is equal to or better than the state program, including rights, protections, and benefits.
Employers with an approved private plan must pay a private plan approval and oversight fee upon initial application and any time the employer applies to amend the private plan.
The fee is $250 for employers with fewer than 50 employees, $500 for employers 50 to 499 employees, and $1,000 for employers with 500 or more employees.
Minnesota Paid Leave: Employer Q&A
What is the deadline to request an Equivalent Plan Substitution?
Employers can submit a request at any time, and they will be reviewed and approved on a rolling basis.
An equivalent plan can take effect at the start of any quarter. It is best to submit your request as soon as it is ready, ideally one quarter before you want the plan to take effect. This will allow time for the Paid Leave team to review your request and for you to provide any additional information or documentation that may be required. It will also ensure you have time to notify your employees.
If you want your plan to be in place when the program launches on January 1, 2026, you should submit your request by November 10, 2025.
Minnesota Paid Leave: Employer Q&A
Can small employers (>50) be exempt?
The legislation does not have an exemption for small employers, including nonprofits.
Many nonprofits in Minnesota identify as “small” (75 percent of nonprofits have less than $1 million in revenue per year) and exempting them would increase the premium and decrease the partial wage replacement for all other participating organizations.
Many nonprofits struggle with offering market competitive benefits such as paid family leave; a state-administered PFML program would allow often cash-strapped employers to plan ahead and offer that benefit at a low cost to both the employer and to employees.
Paid Leave for small employers
Minnesota Paid Leave: Employer Q&A
Can a sector, or subsector, be exempt?
The final legislation did not include an exemption for any sectors, including nonprofits.
Self-employed individuals would be able to voluntarily participate in the program by opting in and paying a 0.7 percent premium.
Minnesota Paid Leave: Employer Q&A
What information needs to be shared with DEED?
Much like the unemployment insurance program, employers will need to share wage detail with DEED so they can determine benefit levels for individual workers.
The same information is already currently shared with DEED by nonprofit organizations regardless of whether or not they are reimbursing employers.
To prepare for PFML launch, your organization needs to designate a Paid Leave Administrator. This person will be your organization’s main contact with the Paid Leave division. You can designate one person or several people, depending on what works for your business. You can find a step-by-step guide at uimn.org/employers/paid-leave.
After you designate an Administrator, go to paidleave.mn.gov to create your Paid Leave Administrator Account. You will need this account to review leave applications, view Paid Leave determinations, and more.
For more information about how to prepare and tools to help, visit mn.gov/deed/paidleave/employers/prepare.
Minnesota Paid Leave: Employer Q&A
How will my organization pay the premiums?
Organizations will pay premiums quarterly to the state’s Department of Employment and Economic Development (DEED).
It is a similar system to the state’s Unemployment Insurance program where all employers are required to submit a quarterly wage detail to DEED. Each employer will have a new account established with DEED for the PFML program.
Minnesota Paid Leave: Employer Q&A
My organization is a reimbursing employer for UI. Would there be a similar mechanism for this program?
DEED will establish an account with each employer.
The employer will pay premiums quarterly and they will be paid into the family and medical benefit insurance account.
Minnesota Paid Leave: Employer Q&A
How long in advance will the employer know that an employee needs to take leave?
The employee will need to give a 30-day notice to an employer for foreseeable leave and as soon as practicable for leave with less than 30 days’ notice.
Bonding leave begins at the time chosen by the employee, but the leave must end within 12 months of the birth, adoption, or foster care placement of the child.
The employee can communicate the need for leave orally, telephone, or text message.
Minnesota Paid Leave: Employer Q&A
Would state agencies build the cost of PMFL on employers into their grant award amounts?
The legislature has authority to appropriate additional funds for state agencies to do this. State agencies would have the option to build this cost into their grant awards.
Nonprofits can build this into their benefits budget when applying for state grants. The cost of PFML is a predictable expense for employers.
Minnesota Paid Leave: Employer Q&A
How much will this cost my organization?
Both the employee and employer will contribute 0.44 percent of employee earnings on a quarterly basis.
Based on the statewide average weekly wage for one employee of $66,924, the employer would pay $58 per quarter ($234 annually) for this employee. To put it into another perspective, a nonprofit with a $500,000 yearly budget for wages would pay $437 per quarter ($1,750 annually) for ALL eligible employees.
To find out how much your organization would contribute, you would multiply 0.0044 * yearly budget for wages.
This calculator tool helps employers and employees estimate their premium cost.
Minnesota Paid Leave: Employer Q&A
Is there support for employers who have employees on leave?
The law does include grants for eligible small employers. Originally the language excluded nonprofit employers, but MCN successfully advocated in 2024 for nonprofit employers to be included. The grants will likely be a maximum of $3,000. DEED has reached out to MCN for guidance on how the program should be structured so that the grants are as accessible as possible.
Is there a cap on the premium?
Yes, the premium cap is 1.2%.
Minnesota Paid Leave: Employer Q&A
Are premium amounts dependent on income?
The premium is set at 0.88% per employee regardless of salary.
Minnesota Paid Leave: Employer Q&A
Can my organization pay the full premium amount?
Yes, an employer can choose to evenly split the amount of the entire premium with employee or contribute the full amount.
However, employees cannot pay more than 50% of the premium.
Minnesota Paid Leave: Employer Q&A
Can my organization pay the wage gap to ensure my employee has a full wage replacement while on leave?
Yes, an employer may pay the employee to ensure they have full wage paid while on leave.
Minnesota Paid Leave: Employer Q&A
Employer resources
- Employer resource toolkit
- How to prepare for PFML
- Employer roles & responsibilities
- Employer accounts (via DEED)
- Minnesota Paid Leave: Employer Q&A
- Calculator tool to estimate your employee premium costs
- Submit questions about PFML to DEED
- MCN’s PFML 1-pager
- Sign-up for DEED employer PFML email updates
- Attend a DEED Paid Leave public engagement event
Employee resources
- Calculator tool to estimate your premium cost
- Payment and time off
- Individual eligibility
- Job protections
- Individuals and families resource toolkit
- Paid leave for birth and bonding
- Submit questions about PFML to DEED
- Sign-up for DEED individual PFML email updates
- Attend a DEED Paid Leave public engagement event
How PFML became law
The new program is a social insurance model built on extensive research and is similar to highly successful models that have passed in 11 other states plus Washington, DC, as well as many countries. (CA, CO, NJ, MD, RI, NY, WA, MA, OR, CT, CO) Minnesota is the twelfth state to pass a Paid Leave program.
During the 2024 Minnesota Legislative session, lawmakers passed an amended version of the Paid Family Medical Leave (PFML) bill, originally passed in 2023. The amendments are technical edits, not changes to the fundamentals of the program, according to the Department of Employment and Economic Development (DEED), a Minnesota state agency administering the program.
The PFML bill passed in 2023 bill included a 0.7% payroll tax to fund the program, split between employers and employees. The 2024 bill amended the payroll tax to 0.88%.
The change in payroll tax was changed for two reasons, according to lawmakers cited in the Session Daily:
- An actuarial analysis was completed earlier this year [2024] that calculated the 0.88% payroll premium rate would be needed to keep the program sufficiently funded to pay out future claim
- Paid leave benefits would begin during an employee’s first week of leave, which the original law would not have paid.
MCN recommends discussing these changes with your organization’s board and preparing accordingly.
MCN supported the PFML program and is a proud member of the Minnesotans for Paid Family and Medical Leave Coalition.
House passes changes to paid leave law amid chaos at close of vote, (Session Daily), May 16, 2024
Family, medical leave law allows workers up to 20 weeks of annual paid time off (Session Daily), 2023