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Local Ordinances in Minnesota

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in Compensation and Benefits,Human Resources

Local governments in Minnesota sometimes legislate their own rules for employers within their jurisdictions.

For example, Minneapolis and St. Paul have living-wage laws stipulating higher pay than the state minimum wage ($6.15 per hour for large employers), while a Duluth ordinance prohibits discrimination based on familial status.  

Living-wage laws

Minneapolis has one of the most complex living-wage laws in the country. Any employer receiving a contract or city subsidy of $100,000 or more must provide one full-time living-wage job for each $25,000 of contract amount or subsidy. (City subsidies are defined as grants, contribution or personal property, real property, principal amounts on below-market-rate loans or any tax breaks.)

Employers that fail to comply must reimburse the city four times the shortfall amount. For example, a contractor performing work on a $1 million contract is obligated to provide 40 full-time living-wage jobs. If the employer provides only 39 jobs, it has a shortfall of $25,000 and must then reimburse the city $100,000.

Employers meeting the above criteria must pay employees 130% of the federal poverty rate, or $12.91 per hour. Or, they have the option of providing health insurance for workers and paying them $10.92 per hour. Health insurance products must meet city guidelines to qualify. Details are available at www.ci.minneapolis.mn.us/cped/living_wage.asp.

Besides its living-wage ordinance, Minneapolis has an Equal Benefits Ordinance that requires city contractors on contracts of $100,000 or more to provide to employees’ domestic partners the same benefits they provide to spouses. The ordinance sets levels for bereavement leave; disability, health and life insurance; and moving and travel expenses.

Across the river in
St. Paul, contractors face a similar, but somewhat simpler living-wage ordinance. The state capital requires the same pay amounts of $12.91 and $10.92 per hour, respectively, as Minneapolis, but they apply to all employees of city contractors on contracts of $100,000 or more. These figures are also pegged to the federal poverty rate.

Businesses that qualify as small businesses under certain state programs are exempt from St. Paul’s requirement, as are employers that have collective bargaining agreements for lower wages. Other employers that believe they should be exempt can make their case prior to the contract letting. The city council may waive the requirement if the employer can make its case.

Discrimination ban

In addition to the protected classes listed in the Minnesota Human Rights Act, Duluth has an ordinance prohibiting discrimination based on “familial status.” The city’s human rights office investigates complaints, and if it finds probable cause that discrimination occurred, it refers the case to the city attorney.

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