Paid family, medical leave conferees agree to delayed start, reduced maximum length of benefits

Supporters of paid family and medical leave were ecstatic when the House and Senate passed their respective bills earlier this month.

But their enthusiasm may be tempered a bit because the conference committee report on HF2 trimmed the annual maximum length of paid benefits to 20 weeks and delayed their start by six months.

Benefits from the bill, which would establish a state-run insurance program providing Minnesota workers paid time off to deal with family or medical issues, would be available starting Jan. 1, 2026. The date set in both House and Senate bills was July 1, 2025.

[MORE: View the policy adoption sheet]

Business advocates are sure to be disappointed because a proposed $10 million appropriation in fiscal years 2026-27 to subsidize certain costs to businesses resulting from the leave program has shrunk to $2.5 million.

Conferees finished their work Saturday afternoon, with more than two dozen motions and two amendments to construct the conference committee report, which was then agreed to on a voice vote.

The report now goes to each chamber, where it is expected to be adopted and sent to Gov. Tim Walz, who’s said he will sign the bill into law. Rep. Ruth Richardson (DFL-Mendota Heights) and Sen. Alice Mann (DFL-Edina) are the sponsors.

“This is something that Minnesotans want,” Richardson said. “The vast majority of Minnesotans have been waiting for paid family and medical leave. This can be an important way to keep folks in the workforce, especially women.”

What’s in the conference committee report?

A self-funding family and medical insurance benefit account modeled after the state’s unemployment insurance fund would be created and managed by a new Family and Medical Benefits Insurance Division within the Department of Employment and Economic Development.

A new tax on employers and employees would ultimately fund the account; the premium rate would be 0.7% of the employee’s wages, half paid by the employee and half paid by the employer.

A $122.3 million appropriation in the 2024-25 biennium would go to the department to start up and manage the paid leave program, including hiring additional staff and acquiring new computers and other technology.

[MORE: View the committee spreadsheet]

The newly created fund would not receive deposits from taxes on employers and employees until Jan. 1, 2026, so conferees agreed to appropriate $648.3 million in fiscal year 2024 as “seed money” so benefits could be available beginning Jan. 1, 2026. The goal is for the insurance fund to be self-sustaining going forward.

In addition to changes in maximum benefit length and the program implementation delay, several other notable policies were adopted, including:

• permitting insurance carriers to offer paid family and medical leave insurance products that could be purchased by business to opt out of the state paid leave plan;
• prohibiting any other supplemental benefit payment combined with any paid leave benefit from exceeding the regular wage or salary of the person applying for paid leave; and
• allowing a person to be fired for misrepresenting facts on a paid leave application.