Minnesota DOLI Releases FAQ and Wage Notice Example for New Wage Theft Law

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Employers face a tight deadline of July 1 to comply with the civil provisions of Minnesota’s new Wage Theft Statute. Late last week, the Minnesota Department of Labor & Industry (DOLI) issued a Wage Theft Q&A and an Employee Wage Notice example. We’ve summarized the highlights of the Q&A and the Employee Wage Notice example below.

Enforcement

  • The DOLI will focus on employer education for the next few months: The DOLI has not established an explicit grace period for employers to come into compliance with the statute.  However, the agency seems to be implying that it will not enforce the statute until it provides more assistance.

Wage Notices for Current Employees

  • Employers are not required to provide wage notices to current employees when the new law goes into effect but must provide wage notices to current employees when they plan to change information that must be included in a wage notice. An employer is not required to provide current employees with wage notices when the new law goes into effect, although this is “strongly encourage[d]” by the DOLI.  However, a wage notice must be provided to a current employee when a change occurs, and that notice must include all of the information required in an initial wage notice and must be signed by the employee.

Wage Notice: Format and Content

  • The wage notice need not be provided in a specific format or form, but all of the required information—including information specific to the employee—must be included. The DOLI has issued an Employee Wage Notice example which employers may, but are not required, to use.  Employers who choose to use the form should first review it carefully to ensure it meets their needs.  The DOLI also notes that collective bargaining agreements and employee handbooks almost certainly won’t suffice as a wage notice.  For example, those documents are unlikely to have the specific rate(s) of pay for the employee or the DOLI’s text regarding translation of the notice.
  • The wage notice must state whether an employee is exempt from minimum wage, overtime, and/or other provisions of Minnesota Statutes, Chapter 177, and the basis under Minnesota law for the exemption (e.g., executive, administrative, professional, etc.). In fulfilling this requirement, employers should keep several things in mind.  First, there may be several bases for exemption, and all of them should be listed.  Second, the wage notice must state the basis for exemption under Minnesota law, not federal law.  Generally, the bases for exemption will be the same under Minnesota and federal law, but there are exemptions that exist under federal law alone (e.g., the computer professional exemption). Finally, employers should take this opportunity to ensure that employees who are classified as exempt continue to meet the criteria for exemption.
  • The DOLI’s required text regarding translation has a problematic reference to an “employment agreement.” The DOLI is requiring employers to include the following statement in wage notices:  “This document contains important information about your employment agreement. Check the box at left to receive this information in this language.”  Unfortunately, the statute requires employers to use the language provided by the DOLI, which includes a reference to an “employment agreement.” Employers should consider adding a prefatory sentence indicating that the statement is included because it is required by state law and does not affect the at-will nature of the employment relationship.

Changes to Information in the Wage Notice

  • An updated wage notice need not be provided each time the information in the original wage notice changes, but any planned changes must be provided in writing prior to the effective date. Whenever an employer plans to make changes to the information contained in the original wage notice (e.g., the rate of pay), the employer must inform the employee in writing of the planned changes before they go into effect.  An employer could issue an updated wage notice, but it is not required to do so and could instead inform the employee of the changes through another written document (e.g., a letter or email).  Additionally, an employee need not sign the written document enumerating the planned changes, but the DOLI states requiring a signature is good practice.  At the very least, employers should maintain a record of providing the planned changes to the employee.
  • Changes to the information in the notice must be provided in English and the language requested by the employee. Whenever employers are planning to make changes to information that must be provided in a wage notice, employers must build in time to obtain a translation for employees who have requested that the notice be provided in another language, and then provide it to the employee prior to the change going into effect.

Earning Statements

  • Earnings statements need not state whether an employee is “exempt” or “non-exempt,” but they must state an employee’s “rate or rates of pay and the basis for those rates.” Essentially, the earnings statement must state whether the employee is paid by the hour, shift, day, week, salary, piece, commission, or other method. According to the DOL, the earnings statement must also explain why the employee is being paid the specific rate listed. Sample explanations provided by the DOLI include “the rates are required by law, the rates are required by a collective bargaining agreement or the rates are established by the employer.” However, it’s unclear how the DOLI interpreted the law to require earnings statements to include these explanations, as the plain language of the law does not appear to require any such explanation.

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