Paid family and medical leave signed into law by Gov. Walz
ST. PAUL, Minn. -- Gov. Tim Walz signed a bill creating state-paid family and medical leave into law on Thursday afternoon at the Capitol.
The program will allow workers up to 12 weeks a year off with partial pay to care for a newborn or a sick family member, and up to 12 weeks to recover from their own serious illness. Benefits will be capped at 20 weeks a year for employees who take advantage of both.
The benefits will kick in on Jan. 1, 2026.
Lt. Gov. Peggy Flanagan said the program will benefit everyone in the state.
"Everyone deserves paid time away from work, to heal, to grow, and to live," Flanagan said at the signing ceremony. "This time is not optional. It's not a nice-to-have. It's a must-have if we truly are going to be the best state in the country to raise a family."
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The program will operate similarly to unemployment insurance. It will be funded by a new 0.7% payroll tax on employers that will take effect in 2026. Employers can deduct half of their premiums from workers' wages. The law contains protections against retaliation for workers who take the time off. It also includes premium relief for smaller companies.
Paid family and medical leave will dovetail with the state's new earned sick and safe time program that takes effect on Jan. 1 to provide shorter-term relief.
Jocelyn Frye, president of the National Partnership for Women & Families, said Minnesota will end up with one of the strongest programs in the country.
A national paid leave program was part of President Joe Biden's original "Build Back Better" agenda and passed the U.S. House but didn't make it into law. Frye said her group hopes Minnesota's adoption will add to the impetus for national program someday. But she acknowledged that that will be difficult with the current divided Congress.
"Like so many issues, what happens in the states influences whether Congress takes up issues across the board, and paid family and medical leave is no exception," she said.
But John Reynolds, state director for the National Federation of Independent Business in Minnesota, called it a "deeply flawed proposal that will cost much more than expected and make it harder for small businesses to keep their doors open."
Doug Loon, president and CEO of the Minnesota Chamber of Commerce, said the program could become the largest mandate on employers in state history.
"This massive policy will bring fundamental changes to every employer and employee in the state — from $1.5 billion or more in annual payroll taxes, unwarranted shifts in benefits, to state approved leave for employees," Loon said in a statement.
But supporters said Minnesota needs to consider the costs of not offering paid leave. They said programs elsewhere have reduced infant and maternal mortality, made it easier for mothers to go back to work after giving birth and reduced reliance on social service programs.
"This is going to be a huge equalizer to address the deep and persistent disparities that exist in Minnesota," said the lead House author, Rep. Ruth Richardson, of Mendota Heights. "This is going to ensure people who have been left out of paid leave programs will for the first time have the ability to care for themselves and not choose between a paycheck and their loved ones."
President Joe Biden commended Walz and other lawmakers for the achievement.
"The Biden-Harris Administration continues to support national paid family and medical leave for families across the country and applauds states like Minnesota that have made significant progress in advancing comprehensive paid leave," a statement released by the White House said.
Minnesota is the 12th state plus the District of Columbia to have passed and implemented a paid family and medical leave program.
