STATE:

Why NFIB

Take Action

Get Support

Stay Informed

Podcast Podcast

Careers Careers

Join Now

Home / News /

Small Business Braces For Minnesota House Vote On Paid Leave Mandate

May 2, 2023 Last Edit: June 5, 2025

Government-Run Paid Family and Medical Leave Will Hurt Small Employers

Small Business Braces For Minnesota House Vote On Paid Leave Mandate

The National Federation of Independent Business in Minnesota, or NFIB, is renewing its opposition to House File 2, which imposes a government-run Paid Family and Medical Leave (PFML) program on small business owners and their employees. On Tuesday May 6th, the House will take up the bill and small business owners are bracing for its impact. The legislation exacerbates the financial, workforce, and regulatory challenges that most small businesses already face in Minnesota. Not only would the bill raise taxes on small business owners, but it also imposes a tax on their employees to pay for the program. “This will be the most expensive and complicated paid family and medical leave mandate for small businesses and workers in the country,” said John Reynolds, NFIB State Director in Minnesota. “And the cost and compliance burden of this mandate are going to fall so much harder on small employers than large corporations. This is why a one-size-fits-all mandate with higher taxes is not the solution Minnesota small businesses need right now – or ever.” Here’s what the legislation does:

$1.5 Billion Payroll Tax on small businesses, family farms, workers, and more.
As the cost of the new government-run program grows, so will the payroll tax. Another state’s payroll tax doubled in just three years.
Mandates that small businesses allow all employees to take up to nearly 6 months off per year for covered circumstances.
Sets up a massive new bureaucracy with over 400 government employees and a $75 million annual budget.
Upends the salary and benefit arrangement for every small business employee, making it harder to offer customized compensation plans to attract new employees.

Small business owners routinely report that labor quality and labor availability are among their biggest challenges. According to NFIB’s most recent monthly Jobs Report, 43% of owners reported job openings they couldn’t fill and 90% reported few or no qualified applicants for open positions. “Despite what proponents claim, it’s clear from other states that a PFML mandate is not a silver bullet for attracting workers,” said Reynolds. “In California and New York, which have had PFML on the books for many years, hundreds of thousands of people left their workforces and their states in recent years. However, states like Florida and Texas saw enormous increases in their workforce – 450,000 in Florida and 650,000 in Texas – during the same period without PFML mandates.” NFIB and its 10,000 members around the state, have been very vocal about how this legislation would impact their ability to operate and hire employees. You can hear their voices and find out more here.

Topics:

Taxes

State:

Minnesota

Get to know NFIB

NFIB is a member-driven organization advocating on behalf of small and independent businesses nationwide.

Learn More

May 22, 2026

Millionaire Tax, New Mandates Mark Another Tough Session for State’s Small Businesses

Despite setbacks, NFIB defeated 90% of bills most harmful to small businesses

May 20, 2026

Post-Primary Comment on the Defeat of Measure 120

Voters send clear message: State government should live within its means

Man in a dark suit and blue polka-dot tie speaks during a live C-SPAN Washington Journal interview, with a cityscape backdrop visible behind him.

May 20, 2026

NFIB on C-SPAN: How Small Businesses are Managing Economic Pressures

A discussion on C-SPAN featuring an NFIB expert covers the current state of the small business economy and the top issues that are impacting Main Street.

May 19, 2026

Small Businesses Encouraged by Introduction of Ohio Gas Tax Reduction

House Bill 850 proposes an immediate 50% reduction for three months.

Small Business Braces For Minnesota House Vote On Paid Leave Mandate

Related Articles