Minnesota Payroll Services

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Minnesota Payroll Tax and Labor Laws

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Did you know that employees covered under the Fair Labor Standards Act must be paid the federal minimum wage of $7.25 an hour instead of the state minimum wage of $10.08 an hour (for large employers) or $8.21 an hour for all other employers?

Minnesota Wage and Hour Laws

Large employers covered by Minnesota's minimum wage law must pay employees at least $10.08 an hour for large employers and small employers must pay employees at least $8.21 an hour. Large employers are those whose annual gross volume of sales or business is at least $500,000. Employees covered under the Fair Labor Standards Act must receive the federal minimum wage of $7.25 per hour.

All employees are covered except for:

  • salespersons with at least 80 percent of their sales made off their employers' premises;
  • certain agricultural workers;
  • cab drivers;
  • those with qualifications and hours under the control of the U.S. Department of Transportation;
  • seafarers; and
  • members of religious orders.

Minnesota Payroll for Employers

Employers must pay wages at least once every 31 days on a regular payday designated in advance. Unless paid earlier, the wages earned during the first half of the first 31-day period become due on the first regular payday following the first day of work.
Minnesota Unemployment:

Taxable Wage Base ($000s):                        35,000

New Employer Rate (% Taxable Wages)    1.1 - 9.0*

Minnesota Income Tax Withholding

Minnesota requires employers to withhold income tax from the wages of residents and nonresidents.

Every employer doing business in Minnesota must withhold state taxes from taxable wages paid to covered employees.

Minnesota has reciprocal agreements with Michigan and North Dakota, provided that nonresidents certify that they are eligible to receive tax credits for income taxes that will be paid to their state of residence. Minnesota residents working in Michigan and North Dakota are exempted from withholding and tax filing requirements for those states.

Minnesota Benefits

Minnesota Voting Rights:

Employer Right to Schedule Voting Hours         Yes

Pay Deduction for Voting Time Leave                 Prohibited

Minnesota requires employers to allow employees sufficient time off to vote. The law does not specify the amount of leave time employees must be granted.

Minnesota State Tax Resources

SurePayroll, Inc. and its subsidiaries assume no liability and make no warranties on or for the information contained on these state payroll pages. The information presented is intended for reference only and is neither tax nor legal advice. Consult a professional tax, legal or other advisor to verify this information and determine if and/or how it may apply to your particular situation.

This website contains articles posted for informational and educational value. SurePayroll is not responsible for information contained within any of these materials. Any opinions expressed within materials are not necessarily the opinion of, or supported by, SurePayroll. The information in these materials should not be considered legal or accounting advice, and it should not substitute for legal, accounting, and other professional advice where the facts and circumstances warrant. If you require legal or accounting advice or need other professional assistance, you should always consult your licensed attorney, accountant or other tax professional to discuss your particular facts, circumstances and business needs.
*Rates vary by industry.
Accurate as of January 2021