In Minnesota, the first Wage Detail Reports under the new Paid Family and Medical Leave law are due on Oct. 31, 2024. Here are the key details regarding this requirement:
- Reporting period: The Wage Detail Reports will cover wages paid between July 1, 2024 and Sept. 30, 2024.
- Who must report: All employers with at least one employee in Minnesota (excluding independent contractors) are required to submit these reports.
- Submission method: Employers will use the Minnesota Department of Employment and Economic Development (DEED) Unemployment Insurance Portal for reporting. Those already submitting unemployment insurance reports can use their existing accounts, while employers not covered by unemployment insurance must create a Paid Leave Only account.
- Content of reports: The reports must include employee details such as:
- First and last name
- Social Security number
- Wages paid
- Hours worked
- Penalties for noncompliance: Employers who fail to submit the Wage Detail Reports on time may face fee-based penalties.
- Context of the law: Although employees cannot take leave under this law until 2026, these reports are a preparatory step for implementing the Paid Family and Medical Leave program.
Employers should ensure they are prepared to submit these reports by the deadline and monitor communications from DEED for further guidance on the process.
How can Workforce Acceleration help?
For employers subject to Minnesota State Unemployment Insurance (SUI), the agency will utilize the quarterly wage data submitted through unemployment tax filings for paid leave reporting. Employers currently exempt from Minnesota SUI must register for a Family Leave Only account and report wages using the information associated with that account. Please note that the system does not accumulate wages when a tax is marked as exempt. To ensure that Minnesota SUI exempt employers can accumulate wages and generate the SUI quarterly return required for reporting purposes, the following updates must be made:
- Tax status update: On the tax maintenance screen, Minnesota SUI exempt employers should change the tax status of the MN-MINNESOTA SUI Employer Tax to Active with a rate of zero percent. The MN-MN WORKFORCE ENHANCE FEE ER should remain marked as Exempt. This adjustment allows wages to accumulate without calculating any tax.
- EIN requirements: The Employer Identification Number (EIN) entered for the MN SUI Employer Tax should be the paid leave only account number assigned to the employer.
- Wage/tax adjustments: For Q3 2024, wage and tax adjustments must be processed to ensure accurate reporting on the quarterly return.
- Future reporting: Moving forward, wages will be automatically calculated and reported on the quarterly SUI return under the paid leave only account.
- Manual reporting for exempt employees: For companies that are subject to SUI but have individual employees who are SUI exempt, those employees will need to be reported manually at this time.
Currently, Vertex has not provided guidance on how Minnesota paid leave will be managed once the tax is officially implemented. Please adhere to the above practices for Minnesota paid leave reporting until further details are released. If you have any questions regarding reporting requirements or need more information about Minnesota paid leave, please contact the agency directly.
More information can be found on the Minnesota’s Paid Leave employer website
This information is provided solely for informational purposes and does not constitute legal advice or create an attorney-client relationship. Its content is general in nature and may not address individual circumstances or specific legal issues. Insperity does not interpret clients’ retirement plan documents and does not administer, have discretionary, or act as a fiduciary of any client-sponsored retirement plans. For legal advice tailored to your situation, please consult with your legal counsel.