Employer of Record for Minnesota

Working Hours in Minnesota

Minnesota has specific employment and labor laws governing working hours, designed to protect employees’ rights and ensure fair compensation. Whether you’re hiring local employees or working with an Employer of Record (EOR), it's essential to understand the state's regulations around working hours to ensure compliance.

1. Standard Workweek and Overtime

Standard Work Hours: Minnesota does not specify a standard workweek; however, overtime pay is required for hours worked beyond 48 in a workweek.

Overtime Pay: Employees must be compensated at one and one-half times their regular rate of pay for hours worked over 48 in a seven-day workweek.

2. Meal and Rest Breaks

Meal Breaks: Employers must provide sufficient unpaid meal time to employees who work eight or more consecutive hours.

Rest Breaks: Employees are entitled to adequate paid rest periods within each four consecutive hours of work to utilize the nearest restroom.

Minimum Wage in Minnesota

As of 2024, the minimum wage in Minnesota is:

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Regional Minimum Wage Variations:

Minneapolis: $15.57 per hour for all employers.

Saint Paul:  

 
• Macro businesses (more than 10,000 employees): $15.57 per hour
 
• Small businesses (6 to 100 employees): $14.00 per hour
 
• Micro businesses (5 or fewer employees): $12.25 per hour

Overtime in Minnesota

In Minnesota, employees are entitled to overtime pay at one and one-half times their regular rate for hours worked over 48 in a seven-day workweek. However, under the federal Fair Labor Standards Act (FLSA), overtime is required for hours worked over 40 in a workweek. Employers must comply with both state and federal laws, adhering to the standard that provides greater benefit to the employee.

Exemptions from Overtime:

Certain employees are exempt from overtime provisions, including executive, administrative, and professional employees, as well as outside salespersons. It's crucial for employers to accurately classify employees to ensure compliance with overtime regulations.

Payroll taxes in Minnesota are deductions employers must take from employees’ wages and remit to the state. These taxes fund various state programs and services, including unemployment benefits and disability insurance. Examples of payroll taxes include:

• State Withholding Tax: Employers are required to withhold state income tax from employees' wages, with rates ranging from 5.35% to 9.85%, depending on income levels.
• Unemployment Insurance Tax: Employers must pay unemployment insurance taxes, with rates varying based on the employer's experience rating and other factors.

Minnesota law requires employers to pay all wages, including salary, earnings, and gratuities, at least once every 31 days on a regular payday designated in advance by the employer. Employees must be paid all wages earned within the first half of the first 31-day pay period on the first regular payday following the first day of work, unless paid earlier. Employers are also required to provide employees with an earnings statement each pay period, detailing specific information such as the employee's name, hourly rate, number of hours worked, and total deductions.

Employment taxes and statutory fees affect both your payroll and your employees’ paychecks in Minnesota. Understanding the tax obligations for both employers and employees is crucial when operating in Minnesota's business landscape.

Employer Tax Contributions

Employers in Minnesota are responsible for several tax contributions, including:

• Unemployment Insurance (UI) Tax: Employers must pay state unemployment insurance taxes, with rates varying based on factors such as the employer's experience rating.
• Federal Unemployment Tax Act (FUTA) Tax: Employers are also subject to federal unemployment taxes, with a standard rate of 6.0% on the first $7,000 of each employee's wages.

Employer payroll contributions are generally estimated at an additional 0.70% on top of the employee salary in Minnesota.

Employee Tax Contributions

Employee tax contributions are generally estimated at 7.65% of employee salary in Minnesota.

Minnesota mandates that employers provide certain benefits to employees, including:

 
• Workers' Compensation Insurance: Required for all employers to cover work-related injuries or illnesses.
 
• Unemployment Insurance: Employers must contribute to the state's unemployment insurance program.

While not mandated, offering additional employee benefits can enhance recruitment and retention. Employers may consider providing health insurance, retirement plans, and paid leave to remain competitive.

Employee Benefits For Minnesota

Competitive benefits are essential for attracting and retaining top talent in Minnesota. Offering the right package helps employees feel valued and motivated. Our benefits experts understand the local labor market's trends, requirements, and expectations, ensuring your employees feel valued and supported. Common benefits in our Minnesota packages include:

• Pension or 401(K)
• Vision Insurance
• Life Insurance
• Medical Insurance
• Dental Insurance
• Health Savings Plan (HSA)
• Flexible Spending Account (FSA)

Sick and Safe Leave

Employers in Minnesota are required to provide paid sick and safe leave to employees under certain conditions. This law applies to employers with 21 or more employees, and it allows employees to accrue one hour of paid leave for every 30 hours worked. This leave can be used for illness, medical appointments, or for the care of family members.

Family and Medical Leave

Minnesota’s Family and Medical Leave Act (FMLA) entitles eligible employees to take up to 12 weeks of unpaid leave per year for certain family or medical reasons, including childbirth, adoption, or caring for a sick family member. Employers must comply with federal FMLA regulations as well as state-specific provisions.

Paid Parental Leave

Minnesota provides up to 12 weeks of paid parental leave to employees who work for employers with 21 or more employees. This leave can be used for the birth or adoption of a child. It is separate from sick leave and FMLA.

Military Leave

Minnesota employers are required to provide unpaid leave to employees who are members of the military when they are called to service. Upon returning, employees are entitled to be reinstated to their former position or an equivalent one.

Voting Leave

Minnesota law also mandates that employers allow employees time off to vote in state or federal elections. Employees are entitled to up to 3 hours of paid leave if they cannot otherwise vote due to work hours.