Minnesota paid leave on track for Jan. 1; early applications open and 0.88% payroll tax set
Minnesota’s paid family and medical leave program is on track to begin Jan. 1, 2026, with early applications already being accepted for parental bonding and a payroll tax set at 0.88% (employers may pass roughly half — about 0.44% — to employees or cover the full amount). Eligibility requires at least $3,900 in prior-year earnings, benefits generally replace 55–90% of wages (capped at about $1,423/week) with up to 12 weeks per event and a 20-week annual maximum, job-restoration protections after 90 days, and the state says it will use layered fraud controls — LoginMN ID and live‑selfie verification, electronic health record certification, unemployment-insurance data, analytics and random audits — to administer an expected first-year caseload of about 130,000 at an estimated cost of $1.6 billion.
📌 Key Facts
- Minnesota’s paid family and medical leave program is on track to begin Jan. 1, 2026, and DEED is already accepting early applications for parental bonding leave.
- The payroll tax is set at 0.88%; employers may collect up to about half (~0.44%) from employees, with employee premiums able to begin in January to fund the program.
- Eligibility requires workers to have earned at least $3,900 in the prior year; most Minnesota employees are covered, with exclusions for federal and tribal employees, seasonal hospitality workers, independent contractors, the self‑employed, and postal and railroad employees.
- Benefits typically replace about 55%–90% of regular wages, capped at roughly $1,423 per week; leave is limited to 12 weeks per qualifying family or medical event, with a combined annual maximum of 20 weeks.
- Job protections guarantee restoration to the same or an equivalent position and begin after 90 days of employment.
- DEED will deploy layered fraud controls including LoginMN identity verification that requires a government ID and a live selfie to deter identity theft and AI‑driven impersonation, and claims must be certified by a health care provider or appropriate professional; Minnesota will be the first state to integrate electronic health records into its verification process.
- Additional program‑integrity measures include leveraging unemployment insurance data to flag and lock suspected compromised accounts, a dedicated data‑analytics team to monitor systemwide trends, random audits of claims, and a program integrity unit to track linked claims and complex family‑care situations.
- Scale and solvency: the program is estimated to serve about 130,000 users in year one at an estimated cost of $1.6 billion, to be administered by roughly 400 state employees; architects say starting with a higher rate aims to support long‑term solvency, a contrast drawn with Washington state’s earlier staffing, payment delays and projected deficits.
📰 Sources (4)
New laws in Minnesota that go in effect Jan. 1, 2026
New information:
- Eligibility threshold: workers must have earned at least $3,900 in the prior year to qualify for benefits.
- Wage replacement detail: benefits typically replace 55%–90% of regular wages, capped at about $1,423 per week.
- Coverage/exclusions clarified: most Minnesota employees are covered; exclusions listed include federal and tribal employees, seasonal hospitality workers, independent contractors, self‑employed workers, postal and railroad employees.
- Event caps clarified: up to 12 weeks per qualifying family or medical event, with a combined annual maximum of 20 weeks.
- Job protections: restoration to the same or equivalent position; protections begin 90 days after hire.
- Employee premium reminder: employers may collect a 0.44% employee premium starting in January to fund the program.
Washington state’s paid leave program struggles. Will MN be different?
New information:
- DEED says Minnesota’s PFML system is on track and is already accepting early applications for parental bonding leave.
- Minnesota’s payroll tax is set at 0.88% (employers may charge employees up to about half, ~0.44%, or cover all).
- Program architect Greg Norfleet says Minnesota benefits from being the 13th state to launch and started with a higher rate to support long‑term solvency.
- Comparative context: Washington state’s paid leave has faced staffing/payment delays and projected deficits ($346M by 2029; nearly $1B by 2030) under tax‑rate caps trending to 1.2% by 2027.
MN paid family medical leave will leverage data, selfies to fight fraud
New information:
- DEED detailed layered fraud controls: LoginMN account verification requiring a government ID and a live selfie to deter identity theft and AI-driven impersonation.
- Minnesota will be the first state to integrate electronic health records into its paid leave verification process; all claims must be certified by a health care provider or appropriate professional.
- DEED will leverage unemployment insurance data (with a strong fraud-prevention track record per a 2022 Legislative Auditor report) to flag and lock suspected compromised accounts.
- A data‑analytics team will monitor system-wide trends; the state will conduct random audits of claims.
- Program scale update: about 130,000 expected users in year one at an estimated cost of $1.6 billion, administered by roughly 400 state employees.
- Republican legislators pressed on potential abuse via multiple caregivers and intermittent leave; statute sets no hard cap, but DEED said complex family situations will be reviewed and claim linkages tracked by a program integrity unit.
- Quotes: DEED Deputy Commissioner Evan Rowe on 'overlapping controls' and MNIT Deputy Commissioner Jon Eichten on selfies to prevent AI identity scams.