Minnesota Documentation Requirements for New Employees

Minnesota Documentation Requirements for New Employees

Minnesota has long required that an employer provide written notice of basic terms of employment to newly hired employees. Most companies will comply with these requirements in the offer letter provided to the employee.  

However, a less formal and more basic format is also acceptable – see the Employee Notice approved by the Minnesota Department of Labor and Industry.  

The consequences of failing to abide by these compliance requirements can be expensive. Fortunately, compliance with these onboarding requirements is relatively easy. 

Mandatory Documentation for Minnesota Employers and Employees 

Every business must comply with Minnesota’s written notice requirements for all new hires. This requires that the employer provide and obtain from each employee a signed acknowledgment of written notice(s) containing the following information: 

  • Employer Identity: The notice must include the employer’s legal name and its operating (or assumed) name if it has one, physical main office address, mailing address (if different from the physical office address), and telephone number. 
  • Employee’s Employment Status: The notice must state whether the new employee will be classified as exempt or nonexempt under the Fair Labor Standards Act. 
  • Rate of Pay: The notice requires disclosure of the rate or rates of pay for the employee, including whether the employee is paid by the hour, day, week, salary, and/or commission. If the employee is exempt, the salary must be expressed as annualized, monthly, or weekly, etc. If a position is nonexempt and therefore overtime-eligible, the notice must include whether the employee is entitled to overtime compensation under the federal FLSA (40 hours), or the Minnesota FLSA (48 hours) depending on applicable law. If commissions or bonuses are included as an element of pay, employers should either fully describe the basics of how they are calculated and paid, or cross-reference written commission or bonus plans. Either way, the terms of commission, bonus, or other variable compensation should always be clearly stated in writing.  
  • Pay Period: The number of days in the pay period and the regularly scheduled payday must be provided, as well as the anticipated first payday for the employee.  
  • Paid Time Off, Vacations, Sick and Safe Time: The notice must include a description of the employee’s entitlement to vacation time, sick time, or other paid time off accruals and terms of use. This includes the new state-wide Employee Sick and Safe Time (ESST) entitlement effective January 1, 2024. Employees working at least 80 hours a year in Minnesota are entitled to up to 48 hours of ESST per year, which can be used by the employee as compensation for time off taken for reasons of mental or physical health, safety, weather, or other public emergencies. ESST may also be used to care for a family member’s mental, physical, or other health condition, or for preventative care.  
  • Lactation Breaks: Effective July 1, 2023, any employee expressing milk must be given a lactation break, regardless of whether they are expressing breast milk for their own child or another, and regardless of whether the break might disrupt business operations. The law requires that notice of this right be provided at the time of hire.  
  • Pregnancy Accommodations: Effective July 1, 2023, all employers, not just those with more than 15 employees, must provide pregnancy related accommodations to expectant employees, including allowing employees to: (1) take more frequent or longer restroom, food, and water breaks; (2) sit while performing work, if possible; and (3) decline to lift more than 20 pounds, even in situations where the job description includes lifting in excess of that amount as an essential function. Beyond these basic requirements, employers must provide other reasonable accommodations to pregnant employees, provided that the requested accommodation does not impose an undue hardship on the employer. 
  • Deductions: The notice must include a clear statement on when and under what circumstances the employer may deduct from an employee’s wages. 
  • Allowances: If the employer offers a meal or lodging allowance and offsets it against a minimum wage, the allowance must be described in a way to be fully understood by a person in the employee’s position. (A meal allowance is credited toward the minimum wage only when the meal is furnished by the employer and accepted by the employee. See Minn R. 5200.0060.)  
  • Work Hours: This section outlines the number of hours constituting a regular workday, offering a clear understanding of daily expectations. Additionally, it provides guidance on how to handle hours beyond the standard workday, including whether such additional hours are classified as overtime. This aspect of the agreement helps manage workload expectations, maintain work-life balance, and ensures compliance with labor laws governing overtime pay. 

All employers must provide the notice to employees in English. The notice must include a statement, in multiple languages, that informs employees they may request the notice be provided to them in another language. If requested by an employee, the employer must provide the notice in another language. For English and translated example notices, plus additional employee notice information, visit the MN Department of Labor and Industry website.   

Additional Terms and Conditions That Can Be Included in Minnesota Employment Agreements 

While Minnesota law establishes the basic requirements, employers can go beyond these requirements to provide a more comprehensive employment agreement. Here are some additional terms and conditions to consider including in your offer letter: 

  • Job Title or Position: Clearly define the employee’s role within the organization. 
  • Reporting Relationship: Indicate who the employee reports to within the company hierarchy. 
  • Term of Employment: If the employment is for a specific duration, such as a fixed-term contract, specify the length of the contract. If it’s an indefinite arrangement, clarify that the employment is at-will and can be terminated by either party at any time with or without cause. 
  • Payment Method: Describe how the employee will be compensated, whether through a fixed salary, hourly wage, commission, or another payment structure. 
  • Benefits Eligibility: Even though the details of benefits are often laid out in separate policies or plans, include information about eligibility criteria for benefits in the offer letter. 
  • Conditions of Employment: Beyond the statutory requirements, you can outline additional conditions such as: 
  • Compliance with Form I-9 requirements for employment eligibility verification. 
  • Completion of background and reference checks as part of the onboarding process. 
  • Verification that the employee has not violated any restrictive covenant agreements with previous employers. 
  • A mention of any requirements related to handling confidential information, trade secrets, intellectual property, or non-solicitation agreements applicable to the employee’s position. 
  • At-Will Employment Statement: Unless you intend to establish anything other than an employment at will relationship, it is essential that you make clear in the offer letter or other Employee Notice, as well as your Employee Handbook, that the employment relationship is at-will. At-will employment means that either the employer or the employee can terminate the employment relationship at any time, with or without advance notice and with or without cause. 

It’s important to note that these requirements apply specifically to employees, not independent contractors. If your business engages independent contractors, it’s advisable to create a separate written agreement for those arrangements and make a clear distinction between employees and contractors.  

Balancing Flexibility with Legal Compliance 

Small businesses are often celebrated for their adaptability, adaptive work environment, and personal connection with employees. These traits make small businesses attractive employers.  

However, these traits can lull small business owners and operators to view strict legal compliance and prudent risk management around employment law as unnecessary. As many small businesses have learned the hard way, through an employee lawsuit or inquiry from the Department of Labor and Industry, this can be a costly and dispiriting mistake.  

Protecting Employer and Employee Interests 

The legal framework governing employment agreements in Minnesota is designed to benefit both employers and employees. It establishes a structured foundation upon which expectations are set, rights are defined, and disputes are mitigated. By adhering to these regulations, businesses can mitigate potential legal risks, while employees can enjoy the security and transparency provided by a written employment agreement. 

In 2024, this balance remains as crucial as ever. The laws evolve to reflect the changing nature of work and the complexities of modern employment relationships. Staying informed about these legal requirements is not just a matter of compliance; it is the cornerstone of maintaining strong, constructive employer-employee relationships. 

Navigating the Legal Landscape Ahead 

In this evolving legal and business environment, the role of small businesses in driving innovation and fostering local economies remains invaluable. By understanding and adapting to Minnesota’s employment regulations, small businesses can continue to thrive while upholding the principles of fairness, transparency, and legality that underpin the state’s labor laws. 

Employment laws change over time and it is important for businesses to stay informed and regularly review their employment documents and practices to ensure ongoing compliance with state regulations. If you have any questions or need legal guidance regarding employment law in Minnesota, please don’t hesitate to contact Avisen Legal, where our experienced attorneys are here to assist you. 

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Bill Egan

Bill Egan

I have 30+ years of experience representing executives, business owners, private enterprises and small-to-midsize public companies as an advisor, counselor and advocate on matters relating to the employment relationship. Informed by years of experience with both routine and unusual employment relationships and workplace situations, I bring a pragmatic, realistic and results-oriented perspective to issues arising in the workplace. Read Bill's Bio.

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