August 12, 2019

Minneapolis Passes Wage Theft Prevention Ordinance

A new wage theft ordinance coming to the City of Minneapolis in 2020 places more stringent requirements on employers than the new statewide wage theft law that took effect on July 1, 2019. On August 8, the Minneapolis City Council unanimously passed the ordinance, establishing the City’s own set of requirements to prevent and punish wage theft. The ordinance becomes effective January 1, 2020.

Variations From the Minnesota Wage Theft Law

Although much of the City’s wage theft ordinance tracks the new state law, the City’s ordinance covers all employees (including temporary and part-time employees) who perform at least 80 hours of work per year for the employer within the City of Minneapolis. Here is where it goes further than the state wage theft law:

  1. The City’s ordinance requires the following information be included on the notice that must be provided to new employees at the start of employment, in addition to state law requirements:
    • The date when employment begins.
    • A description of the employer’s overtime policy.
    • Where applicable, a statement that tip sharing is voluntary under state law.
    • A notice of the employee’s rights under the City’s sick and safe time ordinance, including the method by which the employee will accrue sick and safe time, the date upon which the employee is entitled to use accrued sick and safe time, and the date upon which the employer’s year for the purpose of sick and safe time accrual begins and ends. The notice may provide this information by explicit reference to a section of an employee handbook, collective bargaining agreement or similar document if employees are directed to the specific sections of the document in which such information is provided.
  2. The ordinance requires employers to include an employee’s current balance of available sick and safe time hours (or other qualifying leave, such as paid time off for employers who use PTO to satisfy the City’s sick and safe leave requirements) on all earnings statements.
  3. Employers covered by the ordinance must provide the required new hire notice to all current employees as of January 1, 2020, no later than during the first full pay period of 2020 — unless all of the information required to be included in the new hire notice has already been provided to the employee.
  4. Covered employers must provide employees with written notice of changes to the information required to be included in the new hire notice prior to the date the changes take effect. The change notice must be signed by the employee before the changes go into effect, unless the change is an increase in wages and the employee is informed in advance of the specific amount of the wage increase and the specific date on which it will occur, in which case the employee’s signature is not required.
  5. Unlike state law, the ordinance does not require showing an employer had “an intent to defraud” an employee of wages in order to establish a wage theft claim.
  6. The ordinance establishes a rebuttable presumption that unlawful retaliation against an employee has occurred if an employer, within 90 days of the employee’s exercise of rights under the ordinance (such as the employee asserting a wage theft claim) materially changes the terms or conditions of the employee’s employment. This could include terminating, constructively discharging or reducing the employee’s wages or benefits, or making other changes in the employment that affect the employee's future career prospects. The employer may only rebut this presumption by presenting clear and convincing evidence that the action was taken for a non-retaliatory purpose.
  7. The ordinance establishes its own set of penalties and remedies that employees may pursue outside of the state regulatory structure. However, the City will not impose civil fines if a state or federal administrative agency charged with the enforcement of labor standards laws has previously imposed fines upon the employer for violating state or federal labor standards law based upon the same acts or omissions that constituted a violation of the ordinance.
  8. Employers covered by the ordinance may provide the required notices electronically (and signatures may be collected electronically) if employees have access and time during work hours to review and print the notices. If an employee requests the notice be provided in paper form, the employer must comply with that request. Employers must keep a copy of each required signed notice, or record of electronic signature, for as long as the employee is employed plus three years.
  9. Next Steps for Employers

    Although the City’s wage theft ordinance does not take effect until January 1, 2020, employers who may be covered by the ordinance should become familiar with the ordinance’s requirements and develop a compliance plan, including making the appropriate revisions to recently created new hire wage theft notices developed to comply with the new Minnesota law.

    The Labor Standards Enforcement Division of the City’s Department of Human Rights, which will enforce the ordinance, has published information for employers on its website, available here. The website indicates that additional guidance and answers to frequently asked questions are forthcoming.

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