Minnesota has begun issuing Paid Leave premium rate notices, and many businesses are discovering incorrect classifications. My firms letter was incorrect. Each notice lists separate rates for Medical Leave and Family Leave, and together they should total either 0.66% or 0.88%, depending on whether the state recognizes you as a small employer. Most of you reading this should be at the 0.66%.
If your combined rate shows 0.88% but you expected to qualify for the reduced rate, you will need to challenge the determination. The appeal deadline shown on recent letters is January 5, 2026, and the filing steps are outlined on page 2 of the notice. You can also file an appeal here.
To qualify for the lower employer rate, a business must have 30 or fewer employees and an average wage below 150% of the statewide weekly average. The annual average wage is about $110,000. The reduction applies only to the employer portion; employee withholding percentages remain the same.
If you believe your rate is incorrect, act promptly. If you are a payroll client reach out right away.
The information provided here is for informational purposes only and should not be construed as or relied upon for tax or legal advice. This information is based on the laws and regulations in effect at the time of issuance, and we do not undertake any obligation to update this information after the date of its release. Please speak with your tax professional or attorney for guidance specific to your circumstances.
