The Minnesota Paid Leave program is one of the most significant workplace policy changes in recent years. Beginning January 1, 2026, both employer contributions and employee benefit entitlements will start on the same day, marking a major shift in how organizations plan for time away from work.
In a recent webinar, Sarah Dahl, Ancillary Benefits Consultant at Marsh McLennan Agency and Jenna Estlick, President of HR Solutions at Versique Executive, Professional & Interim Recruiting, walked through the details of the law, breaking down coverage requirements, benefit eligibility, and the critical decisions employers will need to make between public and private plan options. This recap highlights the key takeaways and clarifies the most common questions Minnesota employers are already asking as they prepare for the launch of the Minnesota Paid Leave program.
What’s changing on January 1, 2026
The Minnesota Paid Leave program starts uniquely: contributions and benefit entitlement begin the same day. There’s no pre-funding period. Coverage is broad, as in all public and private employers with one or more employees in covered employment are in scope, with only a short list of excluded entities and workers.
If an employee works 50% or more in Minnesota, they’re covered—regardless of where they live or where the company is headquartered. When no single state hits 50%, coverage follows a second rule: if some work is in Minnesota and the employee lives in Minnesota, they’re covered. (Think border communities and remote teams.) Independent contractors and the self-employed aren’t covered by an employer’s obligation, though they can opt in for themselves.
Employee eligibility and how benefits work
In order to be eligible, an employee needs enough wage credits—specifically 5.3% of the State Average Annual Wage in the base period. That amount is aggregated across all Minnesota employment, not just the current employer. (A brand-new hire with qualifying prior MN wages could be eligible on day one.)
Benefit entitlements split into two buckets: up to 12 weeks of medical leave and up to 12 weeks of family leave per benefit year, with a 20-week annual cap combined. Family leave includes bonding (birth, adoption, foster), safety leave, caring for a family member’s serious health condition, and certain military-related needs. Bonding can be used up to one year from the child’s acquisition, so employees who acquire a child in 2025 may still use bonding time in 2026.
Minnesota Paid Leave requires continuation of all group insurance during paid leave, with employees and employers maintaining their usual premium shares. Job protection begins 90 days after date of hire. For calendaring, the public plan uses a benefit year that rolls forward from the first day of leave; private plans may offer different calendaring methods depending on carrier capabilities.
How much is paid—and what it costs
The weekly benefit uses a three-tier formula (90% down to 55%) tied to the State Average Weekly Wage, with a maximum generally equal to the SAWW—stated in the session as $1,423 for most of 2026. Lower-wage workers see a higher percentage of income replacement; higher-wage workers will cap out at the maximum.
For employers in the public plan, the 2026 known contribution rate is 0.88% of wages up to the FICA cap. Employers with 31+ employees must pay at least half; many plan a 50/50 split. There’s a small-employer reduction on the employer side (for 30 or fewer MN employees with average wages at or below 150% of the state average), which can reduce the employer’s share to 0.22%; employee share remains 0.44%.
Private plan rates may be higher or lower than 0.88%. If a private rate is higher, the employee cannot pay more than 50% of the public plan cost so contribution is still capped at 0.44% based on the 2026 known rate; the employer covers the balance.
Public vs. private coverage—how to decide
There’s no opt-out of Minnesota Paid Leave; employers must choose public or private coverage. Cost matters, but employers should weigh the employee experience, service model, and how leave integrates with existing disability and FMLA administration. Private carriers may give you more levers (e.g., calendar method options) and more “avenues for assistance” (claims team, account manager, broker escalation). If a private-plan approval is ever revoked (voluntarily or not), employers must remain in the public plan for three years.
One notable private-plan nuance: former employees may have up to 26 weeks after separation to file a claim under your private plan (subject to eligibility rules). Employees can’t receive unemployment and paid leave at the same time, and gaining new employment would cut off that private-plan path.
Notices, timing, and administration
On timelines, the state suggests private-plan applications be in by November 10. Although it can be beneficial to build in more buffers and targeting mid–late October, since you must first obtain carrier paperwork (policy number, plan number, policy docs) before you can even apply—and some carriers have earlier internal cutoffs.
By December 1, employers should post the model poster and deliver required notices (in employees’ native languages) explaining cost, contributions, and how to file (state vs. carrier). Employers must collect and retain acknowledgments of receipt—written or electronic.
When leave is foreseeable, employees should give 30 days’ notice. Under the public plan, the state determines eligibility and handles documentation; under a private plan, your carrier does. Expect documentation requirements to feel more like FMLA-style certification than disability forms.
What to do now about The Minnesota paid leave program
- Decide on public vs. private and confirm any carrier cutoff dates.
- Prepare and schedule posters/notices and a process for collecting acknowledgments.
- Designate paid leave contacts in your UI/Paid Leave account.
- Update policies (FMLA, parental, STD) to state concurrency and pay order.
- Plan how you’ll collect employee premiums while employees are out.
- Prepare workforce planning strategies to proactively plan for leaves and coverage starting in 2026.
- Connect with partners like Versique Executive, Professional & Interim Recruiting to connect with resources to help you prepare for these changes.
