Minnesota’s New Wage Theft Law

What Workers Need to Know to Protect Their Pay.

Effective July 1, 2019 (August 1, 2019, for certain criminal penalties), Minnesota’s recently enacted Wage Theft Law provides workers in the state with greater protections of their hard-earned overtime pay and other wages.  This is a major step towards deterring unethical and illegal pay practices that deprive employees of the wages they are legally entitled to.

Here are the key points that workers need to know about the changes to Minnesota labor laws:

Wage theft is committed when, with intent to defraud, a Minnesota employer

1. fails to pay an employee the wages, salary, gratuities, earnings, or commissions at the employee’s rate of pay, or at the rates required by law (including time and one-half for overtime)
2. directly or indirectly causes an employee to give a representation that they were paid greater wages than they were actually paid
3. directly or indirectly demands or receives any rebates or refunds from the wages owed the employee under contract of employment; or
4. makes, or attempts to make, any appearances that wages paid to an employee were greater than the amount actually paid

The new Minnesota wage law provides criminal penalties for employers who commit wage theft. The penalties range up to 20 years imprisonment, a fine of up to $100,000, or both, if the wage theft exceeds $35,000.

Recordkeeping Requirements

The new law requires employers to maintain more records. Employers are now required to keep records of:

• the name, address, and occupation of each employee
• the rate of pay and amount paid each pay period to each employee, and
• the hours worked each day and each workweek for all employees – including those paid on a piece rate
• the personnel policies provided to the employee with the date the policies were given and a copy of notice provided of any updates made to the initial notice

Earnings Statements

Minnesota’s new wage law increases the amount of information that must be provided to employees in their earnings statements. Earning statements must contain:

• the hourly rate of pay
• the basis of pay (e.g., hourly, daily, weekly, etc.)
• allowances for meals and lodging
• the employer’s address of principal place of business and telephone number

Employees must be given access to an employer-owned computer during the employee’s working hours to access and print electronic earning statements is carried forward.

Employees may also request a paper earnings statement.

Notice Requirements

Minnesota employers are now required to make certain disclosures to new employees when they begin work, including:

• a written notice to new employees that includes the rate and basis of their pay
• paid time-off accrual and terms of use
• the employee’s employment status
• any wage or overtime exemptions

Employers must provide employees with written notification of any updates to the original notice.

Timing of Wage Payment

The law also establishes new deadlines for the payment of wages, commissions, and gratuities. Minnesota employers must now pay employees their wages, including salary, earnings, and gratuities, at least once every 31 days. In addition, the law requires that employers pay all commissions earned at least once every 3 months.

Failure to comply with these new payment requirements subjects the employer to additional penalties. For failure to pay wages, the new law modifies the 15-day maximum penalty to unlimited penalties after a 10-day notice period. If an employer fails to pay wages within 10 days of the notice, the commissioner may charge and collect the wages and impose a penalty of the employee’s average daily earnings for each day after the first 10 days. There is also a 10-day notice period for unpaid commissions and a 1/15 penalty per day for commissions that remain unpaid after the notice period has expired.

What Do I Do If I’m being Cheated Out of Overtime Pay?

If you are not being paid 1.5 times your regular rate of pay for all overtime hours and/or certain types of compensation are not being counted towards your regular rate on which overtime pay is based, or if you just aren’t sure that your overtime pay is being calculated correctly, contact us for a free and confidential review of your specific situation, and to see how much you may be owed in back pay.