Minnesota’s Department of Labor and Industry (DLI) has finalized administrative rules for the Earned Sick and Safe Time (ESST) Law, effective July 6, 2026. These clarifications address key pain points for employers—attendance incentives, documentation, accrual calculations, and policy interactions—making compliance more straightforward while protecting employee rights.
Designating & Changing the Accrual Year The statute defines a “year” as a regular, consecutive 12-month period chosen by the employer and clearly communicated to employees. If no designation is made, it defaults to the calendar year. To change the accrual year, employers must provide notice before the change and ensure it does not negatively impact employees’ ability to accrue leave.
When Accrual Is Calculated & How Leave Accrues The rules specify that leave accrued during a pay period must be credited (and available for use) no later than the payday for that period. Accrual occurs in whole-hour units. For example, 80 hours worked in a bi-weekly period yields 2 hours of ESST (rather than fractional amounts). Employers using accrual (vs. frontloading) may advance leave based on projected hours for the remainder of the year. If actual hours exceed projections, employers must “top up” within 15 calendar days.
Switching from Accrual to Frontloading Employers preferring the simplicity of frontloading at least 48 hours per year can switch, but must give written notice to employees. The change takes effect only at the start of the next benefit year. Without timely notice, the accrual method continues unless the employee agrees otherwise.
Using Leave for Indeterminate-Length Shifts For shifts without fixed start/end times, employers have three options to calculate ESST usage: (1) hours worked by a replacement; (2) hours from the employee’s most recent similar shift; or (3) the most hours a similarly situated employee was scheduled. Partial shifts require subtracting actual hours worked from the calculated amount.
Attendance Incentives & Documentation The rules distinguish positive attendance programs (e.g., bonuses for perfect attendance or production goals) from negative ones. Incentives tied to specific goals can be denied if ESST use prevents meeting them—provided the same standard applies to other leaves. Documentation can be requested for absences of two or more consecutive scheduled days, with clear communication required. Failure to provide reasonable documentation removes ESST protections.
Generous paid leave policies must generally align with ESST standards when used for qualifying reasons (Minnesota Paid Leave is excluded). A proposed rule on multi-state work accrual was removed as exceeding DLI authority.
These updates provide welcome clarity for Minnesota employers navigating ESST compliance.
