NOTE: The information in this Alert is current as of March 11, 2020, 12:30 pm Central Time. This is a rapidly-evolving situation and circumstances and requirements may change. Just before the distribution of this Alert, the World Health Organization declared COVID-19 a global pandemic, a declaration which has implications on how certain situations must be handled.

Work Safety

The Occupational Safety and Health Act (“OSHA”) requires employers to provide “a place of employment, which [is] free from recognized hazards that are causing or likely to cause the death or serious physical harm to … employees.” The nature of the workplace affects the type and level of response that may be required. For example, healthcare facilities and establishments caring for susceptible individuals may need to apply higher standards for workplace protection.

Employers should remind employees to take precautions such as staying home if they are sick, minimize shaking hands, diligent hand-washing, and sneezing or coughing into a sleeve or tissue. Employers should also provide additional supplies such as hand sanitizer and antiseptic wipes, frequently clean and disinfect touched objects and surfaces, consider holding meetings telephonically or through other electronic communication means instead of in-person meetings, provide appropriate personal protective equipment to employees if necessary, and send all employees home who become symptomatic at work. Lastly, employers should assign someone, often a member of human resources, as a disease prevention coordinator who will be the point person on the topic for employees, and who will also be charged with regularly monitoring information posted by government agencies for guidance on appropriate measures as the situation is evolving.

OSHA has deemed COVID-19 as a recordable illness when an employee is infected on the job. Therefore, if an employee becomes infected while traveling for work or at work, the employer must prepare and file appropriate reports with OSHA. State laws also have applicable reporting requirements; however, in many states, the reporting of disease is the responsibility of healthcare providers. Currently, there is no obligation for most employers to report a suspected or confirmed case of COVID-19 to the Minnesota Department of Health. The healthcare provider that receives the confirmation of a positive test result is a mandatory reporter who will handle that responsibility, as well as those in charge of any institution, school, child care facility or camp. However, employers should be prepared to file appropriate reports with OSHA for those who have been exposed to COVID-19 at work and should stay updated with changes in connection with state or local reporting requirements.

Travel Recommendations

To date, the Centers for Disease Control and Prevention (“CDC”) has issued several travel warnings. The travel warnings will likely change depending on the spread of COVID-19. If your employees travel internationally, stay updated on the status of international travel warnings by governmental agencies and consider restricting travel to areas that are affected. Similar precautions should be taken for business partners who are traveling from risk areas to your workplace. Consider whether there are alternatives to international travel by your employees or business partners such as videoconferences or other electronic communication means.

The CDC currently recommends that travelers do not travel to China and Iran, as they are listed at a Level 4 Travel Advisory, and to reconsider and avoid all nonessential travel to South Korea and Italy, as those countries are listed at Level 3. Japan and Hong Kong are listed as Level 2, where enhanced precautions should be taken. The CDC also recommends travelers defer all cruise ship travel worldwide. To check the status of CDC travel advisories, please visit the CDC page at https://travel.state.gov/content/travel/en/traveladvisories/traveladvisories.html, as these are likely to change.

For travel to Level 1 and Level 2 risk locations, consider rescheduling business meetings held there and otherwise regularly monitor CDC notices and employees traveling to those locations. These employees should self-monitor for respiratory symptoms and stay home from work if sick, if a household member is sick, or if they have had exposure to a person with suspected or confirmed COVID-19 infection.

Employers should consider implementing a travel ban to countries at Transit Advisory Level 3 or higher including transit stop-overs. Those employees who have traveled to these high-risk areas within the last 14 days or have had exposure to a person with suspected or confirmed COVID-19 infection within the last 14 days should:

• Stay home for the 14-day quarantine period and call a manager or the company’s appointed disease prevention coordinator for further instructions.
• Self-monitor for respiratory symptoms of sore throat, cough, shortness of breath, and fever, and report to the disease prevention coordinator daily.
• Individuals who become ill should seek medical care. Before going to a healthcare facility, call ahead to inform them about recent travel and symptoms.

The Americans with Disabilities Act (“ADA”) controls when and what sort of questions an employer may ask about an employee’s health. Employers may request that employees inform them if they are traveling to a high-risk location for personal reasons to assess exposure risks. While employers cannot prevent employees from traveling to high-risk locations for personal reasons, employers may deny time off for travel to a high-risk location, business cost of a resulting quarantine, or other legitimate business reasons, provided it is not for a discriminatory purpose. Employers should also warn employees that such travel may result in quarantine or self-monitoring upon return (including working from home, if applicable). Lastly, employers may ask employees if they are experiencing COVID-19 symptoms such as sore throat, cough, shortness of breath, and fever. For confidentiality purposes, employers should store this information in a separate, confidential health folder and limit access to those with a business need to know.

Sick Employees

If an employer has a reasonable, objective belief that an employee may have been exposed to COVID-19 and is a danger to the workplace, the employer can require the employee to stay at home or work from home if they are able to do so. Employers should consider the facts and circumstances of an employee’s known connection to an infected individual or recent travel, including the duration of the employee’s trip, the areas the employee visited, the amount of time the employee has been back and the employee’s symptoms.

Pursuant to the ADA, employers cannot require medical examinations unless they are job-related, consistent with business necessity and if the employee poses a direct threat due to a medical condition. A “direct threat” is a significant risk of substantial harm to the health or safety of the individual or others that cannot be eliminated or reduced by reasonable accommodation. An employee infected with COVID-19 can only be considered a direct threat if the CDC, state or local public health authorities proclaims the COVID-19 as a “pandemic” and that it is severe in the employer’s location. A pandemic declaration from international health authorities is not relevant for this consideration. The Equal Employment Opportunity Commission’s regulations identify four factors to also consider when determining whether an employee poses a direct threat: (1) the duration of the risk; (2) the nature and severity of the potential harm; (3) the likelihood that potential harm will occur; and (4) the imminence of the potential harm. Therefore, employers cannot require a sick employee to see a doctor unless COVID-19 is considered a severe pandemic by the CDC, state or local public health authorities for the employer’s location and the four factors have been considered and applied to the situation. During a pandemic, employers should rely on the latest CDC and state or local public health assessments that are appropriate for their location, and to make reasonable assessments of conditions in their workplace based on this information.

After a pandemic has been proclaimed by the CDC, state or local public health officials, employers may send employees home who become ill with flu-like symptoms, specifying that this is not a disability-related action. During a pandemic, employers may also require employees who have been away from the workplace due to exposure to COVID-19 to provide a doctor’s note certifying fitness to return to work. However, doctors and other healthcare professionals may be too busy during and after a pandemic outbreak to provide fitness documentation. Therefore, new approaches may be necessary, such as reliance on local clinics to provide a form, a stamp, or an e-mail to certify that an individual does not have the COVID-19. However, if an employee requests sick leave pursuant to the Family and Medical Leave Act (“FMLA”) or other employer sick leave policies, employees will be required to follow relevant procedures thereunder.

Employers should let all employees know that the company is monitoring the situation and taking appropriate precautions, and that they should discuss any concerns with the company’s appointed disease prevention coordinator. Employers should also direct employees to immediately notify the disease prevention coordinator if they have been exposed to COVID-19, so the company can provide them with appropriate support, such as requiring them to temporarily work remotely if possible, to avoid coworker exposure. Assure employees of the confidentiality of information they provide, and share that information only as necessary or as required by law. Employees who are infected with COVID-19 should not return to the workplace until they are no longer medically infected. If exposure has already occurred, the company should identify other employees who may have been exposed and inform them that they may have been exposed (while maintaining confidentiality of others consistent with applicable law) and assist those employees with possible accommodations, leave requests, benefits coordination, and return-to-work documentation when and as warranted. Employers should consider a deep clean of affected workspaces. Furthermore, employers in a shared office building or area should inform building management so they can take necessary precautions.

Wage and Hour Considerations

The Fair Labor Standards Act (“FLSA”) governs when, and under what circumstances, an employee must be compensated for time not spent working in the office. Under the FLSA, non-exempt employees are not required to be paid for time they are not working. Therefore, if a non-exempt employee is home because they have traveled to an affected area, have been exposed to COVID-19, are exhibiting symptoms, or if there has been a temporary business closure, time at home is not required to be compensable, regardless of whose decision it was for the employee to stay home. However, if the non-exempt employee performs tasks while at home such as working remotely, that time is treated as hours worked and is compensable.

For exempt employees, if a business temporarily closes due to COVID-19, they are entitled to their full weekly salary, unless they have not worked for the entire workweek. If an exempt employee misses work due to their own illness from the COVID-19, the employer may deduct from their salary, depending upon the employer’s paid sick leave policy, provided it is done in compliance with the FLSA.

If an employee misses work because they are infected by COVID-19 or because they are caring for an immediate family member who suffers from COVID-19, that absence may be permitted under the FMLA or other similar state leave laws.

Visitor Screening

Public health organizations recommend that companies bar employees or visitors from coming to the workplace for a period of 14 days after a “medium” or “high-risk” exposure to COVID-19 — generally meaning having been in close contact to or caring for someone who has been diagnosed with COVID-19, or having traveled from a high-risk region; therefore, it is appropriate to provide a screening questionnaire for visitors that asks those questions in order to make that determination. Currently, if visitors have traveled to China, Iran, Italy or South Korea, had close contact with someone diagnosed with COVID-19, or have cold or flu-like symptoms within the last 14 days, access can be denied.

The information within the visitor health questionnaire is sensitive and may be considered health information. Therefore, ensure appropriate privacy and confidentiality of this information once received as well as when reporting back to the visitor whether they are admitted or denied to the facility. Further, only if the CDC or a state or local health authority proclaims a severe pandemic has spread in the employer’s location can employers take employee and visitor temperature checks.

It is recommended that employers consider creating and implementing a communicable disease policy that includes COVID-19. Employers may also want to utilize a visitor questionnaire in order to address relevant concerns and decrease workplace exposure.

The SECURE Act, signed into law on December 20, 2019, has a serious impact on estate planning for clients’ retirement accounts.  In the past, many individuals who inherited retirement accounts were able to “stretch” the distributions over their own life expectancy.  The SECURE Act moves most individuals to a 10-year payout period.  The SECURE Act also makes several other changes that impact clients.

Retirement Accounts During Owner’s Lifetime

• Individuals who own their own retirement accounts can start taking required minimum distributions (RMDs) at 72 instead of 70 ½.
• You can continue to make contributions to a traditional IRA for as long as you’d like.
• You can still make qualified charitable distributions (distributions directly to charity that bypass reporting on your income tax return) beginning at 70 ½.  Note that if you also make contributions to a traditional IRA after age 70 ½, your qualified charitable distributions may be limited.

Retirement Accounts After Owner’s Death

• Eligible Designated Beneficiaries can still stretch distributions over their lifetimes.  Eligible Designated Beneficiaries include spouses, minor children of the owner, a disabled or chronically ill individual, or anyone not more than 10 years younger than the owner.
  • Eligible Designated Beneficiaries also include “conduit” trusts for the benefit of these individuals and, in the case of the disabled or chronically ill, an “accumulation” trust.  Once a minor reaches the age of majority, the “stretch” treatment ends and all distributions must be made within 10 years.
    • A conduit trust is one where all distributions from the retirement account must be paid out to an individual.  The individual recipient pays the income taxes on distributions.
    • An accumulation trust allows the trustee to accumulate any withdrawals from a retirement account in the trust and not distribute them to a beneficiary.  Any withdrawals that are retained in the trust will be taxed at the trust income tax rate (the top rate after a small deduction).
• Designated Beneficiaries (other than Eligible ones) must fully pay out the retirement account assets by December 31st ten years after the owner’s death.  Designated Beneficiaries include all other individuals other than Eligible Designated Beneficiaries, as well as conduit and accumulation trusts.
• Other beneficiaries, such as an estate or a trust that does not meet the requirements of a conduit or accumulation trust, must pay out under the rules previously in place – within 5 years for an owner already receiving RMDs, or over the owner’s remaining life expectancy if the owner was not yet receiving RMDs.

Estate Planning Strategies

• Reevaluate whether retirement accounts should be left directly to a beneficiary instead of to a trust. The advantages a trust previously provided are lessened under the new law.
• A spouse, minor child or person not more than 10 years younger than the account owner should likely not receive retirement account assets through an accumulation trust.  If a trust is still desirable, it should usually be a conduit trust.
• If other beneficiaries need assets retained in trust for their protection due to concerns about substance abuse, creditors or other issues, an accumulation trust should be considered, though only if the concerns outweigh the income tax disadvantages of this option.
• Those who are charitably inclined may want to name a charity as the beneficiary of a retirement account, or leave the account to a charitable remainder trust.
• Most conduit and accumulation trusts as drafted by skilled attorneys still “work.”  Their time frame is simply shortened in most cases – instead of stretched over a beneficiary’s lifetime, withdrawals must now take place under the 10-year rule.
• For questions or assistance regarding updates to estate planning documents, please contact our trusts and estates team.

Effective January 1, 2020, residents of nursing homes and assisted living facilities are permitted by law to conduct electronic monitoring of their living space. Is your facility in compliance? In addition to making your residents informed of their option to conduct electronic monitoring of their rooms or living units, compliance policies must be put in place, and consent and notification forms must be made available to residents, roommates, and the facility. Facilities are also required to post signage at each entrance, advising that electronic monitoring devices may be present.

If you have questions about whether your facility is in compliance, or how to obtain necessary consents when electronic monitoring is conducted by a resident, please feel free to contact us.

Effective January 1, 2020, the Minneapolis Wage Theft Prevention Ordinance (the “Ordinance”) sets forth a stringent set of requirements to prevent and punish wage theft. In addition to the state law requirements, the Ordinance applies to all employers with employees who work in the City of Minneapolis for at least 80 hours in one year. The Ordinance requires employers to provide additional information within notices, pay stubs, and notice posters to covered employees, including all new hires and current Minneapolis employees, no later than January 1, 2020.

While employers are already required to provide notice to new employees pursuant to the state law requirements, the Ordinance requires employers to also provide all new and current Minneapolis employees a notice with the following information:

1. The date employment began or will begin;
2. The employee’s rights under the Minneapolis Sick and Safe Ordinance, including the date the employee began or will begin to accrue Sick and Safe Time;
3. The employer’s policy regarding gratuities, as applicable, and that sharing of gratuities is voluntary; and
4. The overtime policy applicable to the employee’s position, including when the overtime shall be paid and the rate(s) of pay.

The notice must be provided to and signed by all covered Minneapolis employees by January 1, 2020. Employers must retain the signed notice and records of when they provided the initial notice to each Minneapolis employee. Thereafter, any changes to the notice must be provided to each employee in writing before they take effect, which the employee must also sign.

Additionally, employers of covered Minneapolis employees must include information regarding the employee’s accrued and unused Minneapolis Sick and Safe Leave Time on each pay stub.

Employers must post a notice at all Minneapolis job sites in a conspicuous area which explains employee rights pursuant to the Ordinance in English and in any language spoken by at least five percent of the employees. If an employee does not work at a physical job site, the employer may provide a paper or electronic copy to the employee. An example of the notice poster and notice can be found here.

Pursuant to the Ordinance, an employer must pay all wages owed to any employee by reason of employment, for work performed in the City of Minneapolis, on the regularly established payday. An employee or other person may report any suspected violation of the Ordinance to the Minneapolis Department of Civil Rights (the “Department”). If the employer is found to have violated the Ordinance, the Department Director shall order the employer to cease and desist from engaging in the illegal practice and may order any appropriate relief, including compensatory damages, liquidated damages, and civil fines up to $2,000 per violation and failure to cooperate with the investigation.

Lastly, unlawful retaliation will be presumed if an employer materially changes the terms or conditions of the employee’s employment (which would include termination, a reduction in the employee’s wages or benefits, or other changes in employment that affect the employee’s career advancement) within ninety (90) days of the employee’s exercise of his or her rights under the Ordinance. The employer may rebut this presumption by presenting clear and convincing evidence that the action was taken for a non-retaliatory purpose.

It is imperative that employers promptly prepare now to comply with the Ordinance by January 1, 2020. For questions or assistance regarding the new requirements, please feel free to contact us.

On September 24, 2019, the Department of Labor (“DOL”) issued a final rule on overtime exemption under the Fair Labor Standards Act (“FLSA”) that is likely to impact more than 1.3 million American workers and their employers. The rule, to take effect January 1, 2020, increases the salary that “white collar” employees must earn to be exempt from overtime and minimum wage requirements, raising the threshold from $455 per week ($23,660 per year) to $684 per week ($35,568 per year). The final rule also raises the exemption threshold for “highly compensated employees,” who are still subject to a more minimal duties test, from $100,000 to $107,432 annually.

Are you prepared for January 1?

For employers to establish that an employee is exempt from overtime requirements under the “white collar exemption,” three criteria must be satisfied:

1. The employee must be paid on a salary (not hourly) basis not subject to reduction based on quality or quantity of work;
2. The employee must be paid at least $684 per week or $35,568 annually (the new “Salary Level Test”); and
3. The employee’s primary job duty must involve the kind of work that qualifies as exempt, that is, they are employed in a bona fide executive, administrative, professional or computer position, as defined by the regulations.

The final rule issued by the DOL only modifies the Salary Level Test above; the other two criteria are unchanged.

In addition, under the new rule, up to 10% of an employee’s annual non-discretionary bonuses and/or incentive payments (including commissions) can be counted toward meeting the salary level as long as such bonuses and/or incentive payments are paid at least on an annual or more frequent basis. In addition, if an exempt employee does not earn enough in non-discretionary bonuses or incentive payments (including commissions) in a given year (a 52-week period) to retain the salary level required for exempt status, an employer may provide a “catch up” payment within one pay period at the end of the 52-week period. Any such catch-up payment will count only toward the prior year’s salary amount and not toward the salary amount in the year in which it is paid.

It is imperative that employers promptly assess the impact the DOL’s new rule will have on their business and on their employees. By taking proactive steps now, employers may minimize the impact of the new overtime rules before they go into effect on January 1, 2020. For questions or assistance regarding the new rules, please feel free to contact us.

On September 30, 2019, the Minnesota Department of Commerce (Department) published in the State Register its Request for Comments relating to an upcoming rulemaking relating to Pharmacy Benefit Manager (PBM) Licensure and Regulation. According to the Request for Comments, the Department is evaluating “rules needed to establish explicit requirements for licensure and renewal of PBMs doing business in the State of Minnesota with various plan sponsors.” The Department is also considering the need for rules relating to “data collection, transparency reporting, enforcement standards, and other items needed as they come up” to implement the Minnesota Pharmacy Benefit Manager Licensure and Regulation Act (PBM Act), which the Minnesota Legislature passed earlier this year.

As noted in the Department’s solicitation for comments and under the PBM Act, PBMs serve as an intermediary between health plans and plan sponsors, negotiating prices with pharmaceutical manufacturers, managing drug formulary lists, processing claims, and reviewing requests for clinical appropriateness. Under the new law, all PBMs contracting with plan sponsors in the State must have a valid license from the Department, effective January 1, 2020. This new license is in addition to the third-party administrator (TPA) license issued by the Department, which most PBMs likely already have.

The Department notes that its Request for Comments should be of interest not only to PBMs and TPAs, but also to employer plan sponsors, health insurance companies, pharmacists, and consumers of prescription drugs.

A Request for Comments is one of the first steps that an agency takes when it begins the formal rulemaking process under Minnesota law. The rulemaking must be completed by December 31, 2021. Individuals or businesses interested in participating in the rulemaking process are strongly encouraged to do so now, prior to the drafting of the proposed rules.

For assistance in preparing and submitting comments as part of the rulemaking process, or for any other questions regarding this Alert, please feel free to contact David Aafedt or any other member of our Regulatory & Government Relations team.

The Washington State Housing Finance Commission (WSHFC) has released a report on transfer disputes, titled “Nonprofit Transfer Disputes in the Low Income Housing Tax Credit Program: An Emerging Threat to Affordable Housing.” The report discusses the recent increase in the number of challenges that private firms have made on nonprofit partners’ project transfer rights in the affordable housing community, which the WSHFC asserts is detrimental to the public interest.

The report outlines the challenges this trend presents to the availability of low-income housing in Washington and other states, and provides guidelines that it suggests courts follow in resolving disputes. This will be a closely watched issue in the affordable housing community, as the case law surrounding the issues of the LIHTC statute and right of first refusal continues to develop.

To read the full report, visit http://www.wshfc.org/admin/publications.htm.

Our team has been involved in a number of the matters referenced in the report; if you have questions or would like to discuss the report further, please feel free to contact your affordable housing attorney.

On August 1, 2019, the Hands-Free Bill will become law in Minnesota, requiring that drivers may only use their cellphones by voice command or single-touch activation. Drivers may not hold their phones in their hand. If your company has employees that use company or personal vehicles on company time, you may need to revise existing policies to ensure your employees are compliant with the new law.

Permitted Cellphone Use

Under the new law, drivers will only be allowed to text, make calls, use navigational applications, and listen to music if those activities are activated by voice command or single-touch activation without holding the phone. When using a navigational application, drivers must set their destination before driving.

Hand-held use is permitted only in the event of an emergency, or when in an authorized emergency vehicle while performing official duties.

Prohibited Cellphone Use

Drivers are prohibited from using a phone to make video calls, live-stream, use social media applications, game, view photos or videos, use non-navigation applications, and view texts or scroll/type on a phone.

GPS Systems

GPS and other navigation systems that are built into a vehicle are exempt from the new law.

Federal Motor Carrier Act

Employers should also be aware of a similar hands-free rule that was recently passed by the Federal Motor Carrier Safety Administration. The rule requires a commercial motor vehicle (CMV) driver to only use a phone hands-free or by single-touch activation. Employers should note that using a hand-held phone while driving a CMV can result in driver disqualification. An employer that allows or requires a driver to use a hand-held phone may also be fined up to $11,000.

Next Steps for Employers

Employers should evaluate their compliance with the Hands-Free Bill as soon as practicable to ensure they are prepared by August 1. To comply, employers may decide to prohibit employee phone usage entirely while driving; or make clear that employees must adhere to the Hands-Free Bill. Employers may also wish to purchase Bluetooth technology, AUX adapters, or phone clips for company vehicles to help employee drivers use voice command or single-touch activation consistent with the new law. For questions or assistance regarding the requirements under this new law to help revise or draft cell phone policies, please feel free to contact us.

The Minnesota Legislature recently passed, and Governor Walz signed, the Jobs and Economic Development Omnibus Bill, which goes into effect as of July 1, 2019.  The bill amends existing state labor laws and creates new civil and criminal penalties for “wage theft”, as well as new recordkeeping and notice requirements for Minnesota employers.

Wage Theft

The new law makes it a crime to commit “wage theft.”  Wage theft is defined as any of the following actions by an employer, if the employer also has an “intent to defraud”:

• Fails to pay an employee all wages, salary, gratuities, earnings, or commissions at the employee’s rate or rates of pay required by applicable law, when earned;
• Directly or indirectly causes any employee to give a receipt for wages for a greater amount than that actually paid to the employee for services rendered;
• Directly or indirectly demands or receives from any employee any rebate or refund from the wages owed the employee under contract of employment with the employer; or
• Makes or attempts to make it appear in any manner that the wages paid to any employee were greater than the amount actually paid to the employee.

Wage theft, as defined above, includes criminal penalties of imprisonment of up to 20 years and up to a $100,000 fine for any wage theft in excess of $35,000.  This particular portion of the law regarding wage theft goes into effect as of August 1, 2019.

Timing of Wage Payments

The new law also amends Minnesota Statute §181.101 regarding when wages must be paid.  Salaries, earnings and gratuities are now explicitly included in the types of wages that must be paid at least once every 31 days, and commissions earned by employees must be paid at least once every 3 months.  Further, commissions are now included in the types of wages that may be demanded for payment by the Minnesota Department of Labor and Industry (the “Department”).  The Department may charge and collect any commission not paid within 10 days of the demand, along with a penalty equal to 1/15 of the commissions earned but unpaid for each day beyond the 10-day limit.  The law also removes the prior 15-day cap on penalties for late payment of wages, and grants additional authority to the Department to assess penalties for violations of the law.

New Employer Recordkeeping Requirements

The new law also adds additional requirements to the earning statements that must be provided to employees at the end of each pay period.  In addition to the information required under Minnesota Statute §181.032, employers must now also include:

1. The rate or rates of pay, and basis thereof, including whether the employee is paid by the hour, shift, day, week, salary, piece, commission, or other method;
2. Allowances, if any, claimed pursuant to permitted meals and lodging;
3. The physical address of the employer’s main office or principal place of business, and a mailing address if different; and
4. The employer’s telephone number.

Employers are also now required to keep additional employee records.  In addition to the current requirement of keeping the name, address, occupation, rate of pay, the amount paid each pay period to each employee, and the hours worked each day and workweek by the employee, employers now must keep the following records:

• For employees paid at a piece rate, the number of pieces completed at each piece rate;
• A list of the personnel policies provided to the employee, including the date the policies were given to the employee and a brief description of the policies;
• A copy of the notice required under Minn. Stat. §181.032, paragraph (d), including any written changes to the notice.

New Written Employee Notice Requirement

The law also creates an entirely new requirement that employers provide a written notice to each employee at the start of employment, which contains the following information:

1. The rate or rates of pay and the basis thereof, including whether the employee is paid by the hour, shift, day, week, salary, piece, commission, or other method, and the specific application of any additional rates:
2. Allowances, if any, claimed pursuant to permitted meals and lodging;
3. Paid vacation, sick time, or other paid time-off accruals and terms of use;
4. The employee’s employment status and whether the employee is exempt from minimum wage, overtime, and other provisions of Chapter 177 of Minnesota Statutes, and on what basis;
5. A list of deductions that may be made from the employee’s pay;
6. The number of days in the pay period, the regularly scheduled pay day, and the pay day on which the employee will receive the first payment of wages earned;
7. The legal name of the employer and the operating name of the employer if different from the legal name;
8. The physical address of the employers’ main office or principal place of business, and a mailing address if different; and
9. The telephone number of the employer.

Employers are required to keep a copy of this notice, along with an acknowledgement signed by the employee that he/she received the notice.  The notice must be provided to the employees in English, and must also indicate that employees may request, by indicating on the form, that the notice be provided in a particular language. The commissioner will assist employers with providing the notice in additional languages, if needed.

Employers must also provide the employee with any written changes to the information contained in the notice prior to the date on which any changes take effect.

Next Steps for Employers

The new law is effective as of July, 1, 2019.  Therefore, employers should plan to evaluate compliance with the law as soon as practicable.  First, employers should review their payroll documentation to ensure that the earnings statements provided to their employees comply with the new requirements of Minn. Stat. §181.032, including the basis for the wage rate, allowance for meals and lodging, and the employer’s address and phone number.

Also, employers will need to provide new hires with a notice that includes the required categories of information as set forth above. If employers have employees earning commissions, the commission plans should be evaluated for compliance with the law.  Finally, given the new criminal penalties for wage theft, employers should ensure that their wage and hour practices are in compliance with the new requirements of the law.  For questions or assistance regarding the requirements under this new law, please contact us.