Minnesota's paid leave premium rate will not increase next year

Minnesota's state family leave premium rate will not increase in 2027, officials announced on Friday. The premium rate will remain at 0.88% of covered wages.

Employers can continue to collect up to 0.44% from employees in 2027, or employers can choose to cover more. Small employers pay a smaller share.  

This year, more than 75,000 Minnesotans have taken paid leave, totaling more than $600 million in payouts. WCCO reported in July that the program rolled out at $70 million under budget and that the extra money will go back into the pool of money used to pay claims. 

"The first six months of Paid Leave show Minnesotans are excited about the program and will continue using and depending on it to support themselves and their families," said Matt Varilek, commissioner of the Department of Employment and Economic Development. 

The program was signed into law in 2023 and is now fully funded by premiums, which are paid to the state by employers and split with employees. It allows employees 12 weeks of partial pay for medical reasons, such as taking care of a newborn, caring for a family member or caring for one's own health and safety.