The 2026 Minnesota PFL Countdown: Essential Prep for Your Business

Updated: Sep 8

Minnesota Paid Family Leave is coming in 2026 – and represents a significant shift that could ripple through your business.

Virtually every worker in Minnesota is covered – full-time, part-time, seasonal, and temporary employees.
Coverage begins day one of employment – with job protection kicking in after 90 days.
To qualify employees must have made $3,781 in the previous year (5.3% of state avg income).

Up to 20 weeks of job-protected leave per year (12 for medical/12 for family).
Income replacement starts at 90% for lower income earners and will continue to decrease as income does. The maximum benefit is capped at $1,372 a week.
Leave can be taken for an employee’s own health needs as well as those of their family.

0.88% of total wages, split 50/50 between employer and employee (employers can choose to pay more).
Premiums apply to 100% of taxable earnings, not just their base salary.

For a company with 100 employees earning Minnesota’s avg salary ≈ $67,000, a state PFL plan will cost about $29,480 assuming the company picks up 50% of the premium. Total expenses will depend on plan type – state or private.
If there is not currently an employer funded short-term disability plan, this will be a new line item.
With the maximum benefit being $1,372 per week – that’s 23% income replacement for an individual making $300,000 in a year. Additional short-term disability insurance may be required to properly insure high-income earners or those employees outside Minnesota.

Key employees having access to prolonged and intermittent leave will become a reality – whether it’s your CNC machinist, lead project manager, or frontline worker. Having proper backup plans for key employees being out will be critical to ensure operational continuity.
- Do you have an up-to-date succession plan for key personnel?
- Do opportunities exist to cross-train employees?
- Are your time-off policies ready for intermittent leave for things like doctor visits?

State Plan: Likely will be the cheapest, but it’s year one – expect growing pains.
Private Plan: Potentially smoother administration, and a more intuitive employer/employee experience – at a premium.
- A private plan does present an opportunity to bundle on other non-medical insurance lines and save.

Start internal conversations with HR, finance, and operations now.
Audit current disability insurance coverages to identify what will overlap with MN PFL and what, if any, gaps are present for high-income earners.
Run a cost/benefit analysis between a state or private plan.
Map out strategy for intermittent leave, including backup staffing and cross-training.
Build a Q3/Q4 implementation roadmap to ensure all systems and procedures are ready for 2026.

With 2026 fast approaching, now is the time to get ahead of the curve and prepare your team, policies, and workforce for the changes ahead.

Interested in learning more? Contact Us!

Cole Skelton CSkelton@cottinghambutler.com 319.936.3463