MINNESOTA PAID LEAVE
What Small Businesses Need To Know
Minnesota Paid Leave took effect in 2026.
Whether you’re self-employed, running a small team or just here for the paperwork, find your next steps below.
Coverage
Small employers are covered by Paid Leave, not excluded. It means you have a reduced premium rate, not whether you participate.
Qualifying
To qualify as a small employer under Paid Leave, you must meet limits on both employees & wages. You meet these limits if you had 30 or fewer employees in every quarter of the past year & your average wage was at or below 150% of the state average wage (currently $27,748.88 per quarter).
Note: This is a different test than the Small Business Administration uses, so qualifying as ‘small’ elsewhere don’t automatically carry over here.
Designation
You don’t need to apply for Paid Leave. You’ll be notified automatically if you qualify as a small employer based on the wage reports you already file.
Cost
The 2026 small employer premium rate is 0.66% of wages, vs. the 0.88% standard. Employees can be charged up to 0.44%, so a small employer’s own share can run as low as 0.22% of wages.
Protections
Paid leave comes with protection for your employees & retention for you. After 90 days of employment, workers generally have the right to return to their job (or an equivalent one) when leave ends. If you offer health insurance, this must continue through the employee’s leave. It is unlawful to retaliate against a request or use of Paid Leave.
Notification
Employers are required to display a workplace poster (in English & any language spoken by five or more employees) & individually notify employees. You should keep each employee’s signed acknowledgment of notice on file.
Note: If you haven’t already notified your team, do it now. The original deadline for current employees was Dec. 1, 2025. Any new hires still need to be notified within 30 days of their start date.
Download the required poster & sample notices
Available in 40+ languages
Small employers aren’t exempt from Paid Leave. They’re covered, and some may have a lower premium. If you’ve got 30 or fewer employees, here’s what that actually means for your business.
KEY FACTS
YOU DON’T HAVE TO FIGURE THIS OUT ALONE
Minnesota’s Small Business Development Centers (SBDC) & Main Street Alliance offer free, one-on-one consulting on Paid Leave compliance. No strings attached. This resource is offered through the Minnesota Dept. of Employment & Economic Development (DEED).
≤ 30 employees
sMALL BUSINESSES
*Small employer qualification follows current Paid Leave rules & dollar thresholds, which are reviewed & subject to change.
Check your current status in your Employer Account → https://mn.gov/uimn/employers/
SUPPORT FOR INCREASED COSTS DURING AN EMPLOYEE’S LEAVE
If you qualify as a small employer under Paid Leave, you can get reimbursed for costs like hiring a temporary worker, paying overtime to cover a shift, or training someone to step in. You could receive up to $3,000 per leave, up to $6,000 per employer each year.
The small employer assistance grant holds $5M in funds annually. Funding levels are reviewed periodically. Visit the state site to confirm current grant caps.
The Details:
This is a reimbursement program: pay the costs first, then apply with proof of payment.
Your business must be in good standing with the Minnesota Secretary of State.
Log into your Paid Leave Administrator Account → Request a Small Employer Assistance Grant application packet →
Receive instructions via email.
SMALL EMPLOYER ASSISTANCE GRANT
Eligibility
To opt in, you must be a Minnesota resident & earned at least 5.3% of the state's average annual wage in net self-employment income (about $3,900 in 2026).
Benefit
Once you opt in, you can take up to 12 weeks of family leave & 12 weeks of medical leave a year, up to 20 weeks total if you need both. You'll receive partial wage replacement.
Cost
The 2026 premium rate is 0.88% of your net self-employment earnings from the previous tax year, up to the OSDI limit ($185,000 for 2026). You pay it as one lump sum, a full year of premiums, upfront, before your coverage starts.
Commitment
Once you’re approved, you’re in for at least two years. If you want out after two years, notify Paid Leave by December 1 to opt out starting the next January.
Deadline
Coverage always starts at the beginning of a calendar quarter & you have to apply during the prior quarter.
SELF-EMPLOYED &
SOLE PROPRIETORS
If you’re self-employed, a sole proprietor, a single-member LLC, a general partner or a freelancer or gig worker, Paid Leave doesn’t cover you automatically. You have to opt in.
Not sure if you count as self-employed?
KEY FACTS
NOT SURE WHAT YOU’D OWE OR GET BACK?
*Self-employment guidance for Paid Leave follows IRS rules as of a specific point in time & those rules are subject to change.
Confirm your current eligibility at pl.mn.gov.
Every document your business needs to get paid leave right
Handbook Policy Template
Ready-to-use language for your employee handbook.
New-Hire Notice Sample
Meet the 30-day notice requirement.
Workplace
Poster
The required poster, ready to print & display.
Small Employer
FAQ Sheet
Quick answers to the most common questions.
Employee Acknowledgement Form
Signed documentation of notice receipt.
Enter your info below & we’ll send you your selected documents straight to your inbox.
We’ll only use your information to send the document you request and, if you opt in, occasional Paid Leave updates. We won’t sell or share your information.
FREQUENTLY ASKED QUESTIONS
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No. It’s optional.
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No; small employers are covered, just at a reduced premium rate.
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Yes, via the Small Employer Assistance Grant.
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Necessary notification assets can be found here.
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Read more on the option for an approved “equivalent plan” & where to apply for that designation.
The page summarizes Minnesota Paid Leave program information.
Program details, including rates, limits, and deadlines, are set by the State of Minnesota and may change.
Always confirm current requirements on the state’s Paid Leave website.
Created by Main Street Alliance.
Funded by the Minnesota Paid Leave program.