Guide to the
Minnesota Paid Family and Medical Leave (PFML) Program – Are You Ready?

What is the Minnesota Paid Family and Medical Leave Program? 

The State of Minnesota has a new paid leave changes that will affect employers.  Effective January 1, 2026, the changes can impact employers regarding paid leave.   

The Purpose of The Minnesota PFML Program:

PFML provides employee paid leave for various reasons, including family care, personal medical needs, and bonding with a new child.

Minnesota PFML Program Eligibility:

1. An employee must have worked at least 12 months and 1,000 hours in the previous 12 months.

2. And additional 8 weeks can be used to pregnancy-related leave.

3. Employee to have earned at least $3700 in the previous year and experienced a qualifying event lasting at least 7-days.

4. PFML can be requested for the employee’s own serious health conditions and/or a family member with a serious health condition.

5. Support a family member called to active duty.

6. Employee need to respond to issues related to domestic violence, sexual assault, or stalking of the employee or their family member.

Minnesota PFML Program Exemption:

Seasonal Hospitality Employers can apply for an Exemption, if applicable. Employers can request a special designation for certain seasonal hospitality employment. IF approved, the employer will not be required to provide PMFL or pay the premiums. In addition, approved employers must provide notice to all employees.

What are the Employer Responsibilities for the Minnesota PFML?

• Determine Plan(s): All Minnesota employers that are currently set up through Minnesota Unemployment Insurance will default to the Minnesota plan if no action is taken. Alternatively, employers can submit an employer equivalent plan or third-party insurer plan for approval. The deadline to opt out of the Minnesota-administered plan and seek approval for an employer equivalent plan or insurer's plan was recently moved to Nov. 15, 2025.

• Designate Administrator. Employers must designate a Paid Leave Administrator in their Employer Account by following DEED's step-by-step guide. The Administrator will be the main point of contact between the organization and the state. Employers must also create a Paid Leave Administrator Account at paidleave.mn.gov, which will provide administrators with access to review applications and view Paid Leave determinations.

• Determine premium split. Employers can generally deduct up to 50% of the premium through regular payroll deductions. If the employer chooses to share the premium cost with employees, deductions can begin Jan. 1, 2026.

• Review policies. Employers will want to review leave policies and determine if any changes are necessary based on Minnesota Paid Leave benefits. DEED launched an Employer Toolkit that provides guidance on benefit calculations, taxability, "top-off" benefit determinations, and answers other frequently asked questions regarding employer policies. (See UKG Tips below)

• Communicate to employees. By Dec. 1, 2025, employers must provide employees with notice of Minnesota Paid Leave. Employers are required to both hang a Paid Leave poster and inform employees individually.

• Posters must be displayed where employees can easily see them and must be posted in English and any other language that is primary for five or more workers.

• Employees must be notified individually in their primary language, and employees must acknowledge that they have received the information. Employers are encouraged to obtain written or electronic signatures from employees acknowledging receipt and understanding.

• Posters and notices can be downloaded from the For Employers page on the Paid Leave site.

Responsibility Impact:

• Employers must contribute to the paid leave fund based on employee wages.

• Contribution rates will be determined and communicated by the State.

• Record Keeping - Employers must maintain accurate records of employee hours worked and contributions made.

• May face challenges in managing workloads during employee absences, as they might have fewer employees to cover shifts.

• Employers should start planning now to comply with the new law, including budgeting for contribution costs.

How is UKG Responding to PFML Mandates?

UKG will deliver the ability to support the PFML mandate on December 26.

The solution is designed to handle both state and private plan participation and will include the creation of new tax codes (for employer contributions and employee deductions). These codes will be automatically assigned to MN employees.

Here’s the copy from the UKG announcement on the MN PFML Mandate:

We will be supporting both state and private plan participation for the Minnesota Paid Family and Medical Leave (PFML) program. The planned December 26th deployment will deliver the core functionality in UKG Pro to support both plan types — including company-level tax setup, employee tax assignment, and payroll calculations.

As part of this implementation, we are creating new tax codes for both employer and employee contributions, separated by medical and family leave types. These codes will be automatically assigned to any company and employee we identify as subject to MN PFML. Customers will simply need to review the configuration to ensure it aligns with their expectations (e.g., if they are using a private plan or applying any exemptions or adjustments).

This enhancement will support the taxation needs of paid leave. There are some recommended steps should you utilize the time-off request features of UKG.

UKG Tips: What Do UKG Clients Need to Do to Update and Test UKG for PFML Changes?

Preparing for PFML:

Employers should start planning now to comply with the new law, including budgeting for contribution costs.

To better accommodate PFML employers need to review current leave policies as there are new eligibility conditions.

• Qualifying events: Birth or adoption of a child

• Personal or family health concerns

• Active duty leave

Examine your policies for which leave types can be used for employer payment.  Typically, accrued paid leave, such as vacation, sick and personal leave, are used first. 

UKG Configuration Review/Changes for PFML:

Review your Pro and Leave Configuration Setup:

• Company-level tax setup

• Current Leave plans

• Employee W-4

PFML Options for UKG WFM Users:

If you only use WFM Timekeeper and Accruals, please review Option 1 below.

If you use WFM Leave Management, please review Option 2.

• Option 1 assumes the Leave module is not configured, or a Minnesota Plan does not exist and is not wanted. An accrual policy can be configured to adhere to the new guidelines in Minnesota.

  • Accruals Only

    • Qualifications controlled in the Grant/Probation Period

    • Accrual for 8 weeks based on 40 hours work week times FTE

    • Time Off Request can be setup for either employee or manager with manager approval

• Option 2 assumes the Leave Module is configured with a Minnesota Plan. A new policy can be added to the existing Minnesota Leave Plan to accommodate the new guidelines.

  • Leave Administration

    • New Policy added to Minnesota Profile

    • Qualifications tied to the Leave Plan

    • Leave Plan associated with both the 8 weeks paid Accrual Pay Codes and non-paid Pay Code.

    • Reset rules can be applied.

    • Time Off Request can be setup for either employee or manager with manager approval

Testing UKG Configuration for PFML:

Prepare your test cases:

• Employee taking leave beyond accrued balances

• Employee taking more than 8 weeks

• Employee taking more than 20 weeks (pregnancy-related leave)

If you have a Test environment:

• Make the configuration changes

• Identify test employees with different plans and potential leave dates

• Submit Time off Request with example test cases

• Process test payroll and review payroll register for deduction/contribution activity

If you only have a Prod environment:

• Conduct mini-test by establishing a few test employees

Improv Can Help with Your PFML Journey!

We’re experts in Workforce Management, Human Capital Management, and business transformation, we’re here to help you navigate complex change. Reach out to Mary Sarracino for more information!