As expected, Governor Dayton has vetoed the Uniform Labor Standards Act which was passed Thursday by both houses of the Minnesota Legislature. Among other things, the bill would have preempted city ordinances imposing higher a minimum wage rate than required by state law and mandatory paid sick and safe leave for certain employees. With the veto, the preemption effort effectively is dead, at least until the next legislative sessions.
What this means is that effective July 1, Minneapolis and St. Paul will become the first major Midwestern cities to enact ordinances mandating that employers operating within their respective boundaries provide paid sick and safe leave for their employees. The ordinances each require employers, regardless of location, to provide sick and safe leave for any employee who works more than 80 hours per year within the respective city’s limits.
A court challenge to the Minneapolis ordinance was partially successful, but only to the extent that the ordinance applied, not only employees of employers located in the city limits, but also to any employee of an employer located outside the city if the employee worked at least 80 hours per year within the city limits (e.g., delivery drivers, home service and repair providers, etc.). A Hennepin County District Court judge granted a temporary injunction preventing the city from enforcing the measure against employers located outside city limits. A reconsideration request and/or an appeal of that ruling is likely.
In the meantime, Minneapolis and St. Paul employers that have not already done so, should take steps to comply with the ordinances. It is worth noting that although the twin city ordinances share many significant features, they are not identical twins.
Both ordinances go into effect on July 1, 2017, and share the following features:
The differences are few, but they are not insignificant, particularly given the proximity of the cities and the number of employees that will fall within the protections of both ordinances. The differences include:
The Minneapolis ordinance exempts employers with fewer than five employees from the paid leave requirements. Those with five or fewer employees, however, must provide 48 hours of unpaid leave per year.
The St. Paul Ordinance is effective July 1, 2017, for employers with more than 23 employees and January 1, 2018, for the remainder.
St. Paul provides no exemption to the paid leave requirement for small employers.
Minneapolis has exemptions for certain on-call employees. St. Paul does not.
The Minneapolis ordinance allows employers operating under a collective bargaining agreement to negotiate alternate means of meeting the goals of the ordinance. St. Paul’s version expresses no such exception.
Minneapolis requires employers to maintain records for each employee showing accrued and used safe and sick time “for each day of the workweek.” St. Paul does not require a day-by-day record.
In Minneapolis, startup businesses are exempt from paid leave requirements for their first 12 months of operation. In St. Paul, the cutoff is six months.
In both cities, eligible employees are entitled to unpaid leave during these periods.
St. Paul’s ordinance provides a private right of action for retaliation. The Minneapolis ordinance prohibits retaliation but does not expressly provide for a private cause of action.
All organizations doing business in Minnesota should determine whether they have any employees who could arguably be covered by either city’s sick and safe leave requirements and take appropriate measure to ensure compliance, among them: