The minimum wage rate in Minnesota increased on January 1, 2021.

• Large employers (annual gross revenues of $500,000 or more) must pay at least $10.08 per hour.
• Small employers (annual gross revenues of less than $500,000) are required to pay $8.21 per hour.

In Minnesota, employers can pay a youth rate of $8.21 per hour to employees who are younger than 18 years old.

Additionally, the state permits a training wage rate of $8.21 per hour for the first 90 consecutive days of employment for employees who are younger than 20 years old.

Under Minnesota state law, municipalities can set their own minimum wage rates, and both Minneapolis and St. Paul have done so.

As of July 1, 2021:

• Minneapolis: The minimum wage is $12.50 for small employers (100 employees or less) and $14.25 for large employers (more than 100 employees).
• St. Paul: The minimum wage is $12.50 for large businesses, $11 for small businesses, and $10 for micro businesses.

Required posters:

• Age Discrimination
• Minimum Wage
• Safety and Health Protection on the Job
• Unemployment Insurance
• Workers' Compensation
• No Smoking Sign

According to state law, employers must pay overtime for all hours worked over 48 in a workweek. For employers subject to the federal Fair Labor Standards Act (FLSA), overtime pay is required for work exceeding 40 hours in a workweek.

Overtime is calculated based on actual hours worked, meaning holiday hours, vacation time, and sick leave do not count toward the 48 hours under Minnesota law.

The overtime rate is one-and-one-half times the employee’s regular rate of pay. If an employee receives meal or lodging allowances against the minimum wage under Minnesota Rules 5200.0060, these credits must be included in the employee’s pay when calculating overtime.

Employer Obligations

In Minnesota, employers must pay overtime wages regardless of:

• The firm’s size, location, or gross sales
• The method of compensation (hourly, salary, commission, piece rate, or other)
• Designations such as part-time, temporary, seasonal, or contract

Exempt Employees

Some employees may be exempt from overtime, including:

• Executive, administrative, or professional employees who meet the salary and duty requirements of the department’s rules
• Outside salespersons
• Salespersons, parts persons, or mechanics for vehicle dealerships who sell or service automobiles, trailers, trucks, or farm implements, are paid on a commission or incentive basis, and are employed by a dealer selling to the consumer
• Agricultural workers paid a salary of at least $724.71 per week for large employers grossing $500,000 a year or more, or $590.94 per week for small employers grossing less than $500,000 a year

Employers must maintain records about employees in the following nine areas, as required by the Minnesota Department of Labor and Industry:

1. Name, address, and occupation
2. Rate of pay and the amount paid each pay period
3. Hours worked each day (including start and end times with a.m. and p.m. designations) and each workweek
4. For employees paid by the piece rate, the number of pieces completed at each piece rate
5. A record of each meal accepted by employees if the employer is taking a meal credit
6. Proof of age for minors employed (birth certificate, driver’s license, school-issued age certificate, or I-9 form)
7. A list of personnel policies with brief descriptions, including the date the policies were given to the employee
8. The employee notice required to be provided to and signed by the employee at the start of employment, along with any written changes to the notice provided to the employee
9. For employers working on public works projects funded in whole or in part with state funds, a certified payroll report must be furnished every two weeks, under oath signed by an owner or officer, to the contracting authority and the project owner, detailing the wages and benefits paid to each employee during the preceding weeks

The Minnesota Department of Labor and Industry can request and inspect employer records at any time. Employee records should be kept either at the work location or be retrievable within 72 hours.