Minnesota PFML Is Coming in 2026: What HR Teams Need to Know Now

Written by: Catherine Gebhardt, Sales Executive - Employee Benefits

Minnesota Paid Family Medical Leave (MN PFML) is a game-changer for employee benefits and workplace culture. With thoughtful planning and proactive communication, HR teams can turn this mandate into an opportunity to support employee well-being and strengthen organizational trust.

Start Date: January 1, 2026,

This ambitious initiative, designed to provide up to 20 weeks of paid, job-protected leave for eligible employees. For HR professionals, this marks a significant shift in how leave is managed, tracked, and communicated. Internal management, communication and continuing education are key to stay up to date on the latest changes.

Here’s what you need to know to prepare your organization for Minnesota PFML:

PFML benefits are designed to replace a higher percentage of income for lower-wage workers, with up to 90% wage replacement for the lowest earners. Wage replacement tapers down as annual wages increase.

Maximum weekly wage for 2026 = $1372

Weekly wage repayments cannot exceed the state average weekly wage of $1,372. Meaning, no matter your pre-leave earnings, the maximum weekly wage replacement amount cannot exceed the state's average weekly wage.

Average weekly wage calculations will be recalculated by the State of Minnesota on an annual basis and applied for the upcoming calendar year.

Premiums and Contributions

Starting January 1^st, 2026, employers and employees will share the cost of the program:

• Total premium rate: 0.88% of employee wages

• Employer minimum contribution: 50% (0.44%)

Employers may choose to cover the full amount or a custom percentage as long as the minimum contribution of 50% is met.

Employer FML Contributions, under IRS Revenue Ruling 2025-04, are federally tax deductible as an ordinary and necessary business expense under excise taxes or wages, depending on the accounting classification of the employer.

Plan Options for Employers

Employers have three options to comply:

• State Plan – Ideal for small businesses (2–20 Minnesota employees) with limited HR resources.

• Private Plan: Insurance Carrier Partner– Suitable for small to mid-sized companies (20–500 Minnesota employees) seeking additional administrative support, integrated leave management programs, and additional non-medical benefits.

• Private Plan: Self-Funded, Vendor Managed, Self-Managed– Available for larger employers (500+ Minnesota employees) with robust HR and legal teams.

Larger employers are also choosing private plans through an insurance carrier partner due to the unpredictability, complexity and volume of claims, plan administration assistance, along with the ability to have an outsourced partner for their HR team.

** Each plan option must meet or exceed the benefits offered by the state plan. Private insurance carrier plans are responsible for plan filing, annual reporting, and compliance. Private plans also manage regulatory updates to ensure plan guidelines concur with the state plan. **

Small and mid-sized employers are leaning towards either the State Plan or Private Insurance Plan strategy. This will help to alleviate administration, leave management and legal compliance, with regards to issues which may arise when creating plan documents from scratch.

HR’s Role in PFML Administration

HR teams will be at the center of PFML implementation. Key responsibilities include:

• Tracking leave (continuous, intermittent, or reduced/nonconforming schedule accommodations) including leave taken + remaining available balance

• Verify employee eligibility, including employee type (fulltime, part time, seasonal)  - Coordinating with insurance carriers or the state plan

• Maintaining employee benefits during leave

• Communication of benefits eligibility and/or benefits termination timeline should the employee not return to work.

• Educating employees on their rights and responsibilities. Newly hired employees must receive notice of MN PFML within 30 days of hire date

• Retain documents including any notes regarding insufficient notice of initial leave request or extension of leave requests 

• Communicate leave notice violations or issues to the Commissioner/State of MN PFML department

Whether working through the MN State Plan, a Private Insurance Carrier, or Self-Funding, communication with the MN State Insurance Commissioner and/or the State of MN PFML department will be required.

Interested in learning more? Contact Us!

Catherine Gebhardt CGebhardt@cottinghambutler.com (608) 467-5021 ext 2351