St. Cloud Small Business Owners Express Concerns Over Minnesota’s New Paid Family and Medical Leave Program

(KNSI) – St. Cloud small business owners expressed concerns over Minnesota’s new paid family and medical leave program during a visit by a member of the governor’s cabinet.

Jake Judd/KNSI News

Minnesota Department of Economic Development Director Matt Varilek was the featured speaker at a Government Affairs special meeting with the St. Cloud Chamber of Commerce and Rotary on Tuesday afternoon. He touted the state’s new program as a good policy.

During the 2023 legislative session, Minnesota became the 13th state to implement the program. It provides partial wages for people taking 12-20 weeks off a year for medical leave, caring for a family member, or caring for a newborn and other conditions.

Jules’ Bistro Owner Donella Westphal is worried about a new regulation getting added to her plate. “As small business owners, we are human resources, we are accounts payable, and we are accounts receivable. Small business owners really do a lot of that on their own. And so the concern from my perspective is just making sure that it’s manageable.”

Westphal says she loves her team and wants the best for the people who work for her but worries the program will make it harder to offer other benefits. “I think it’s just a little overwhelming and sometimes a little frightening to think about how to manage some of these new programs and expenses in conjunction to what I’m already providing for my team.”

Some small business owners are worried that workers will take advantage of the program and leave them with a hole that can’t be filled.

Varilek indicated there would be opportunities for small businesses to provide input before the legislation is implemented.

Paid family and medical leave will be funded with a .7% to 1.2% payroll tax split between employees and businesses. The tax will start to be collected on January 1, 2026. Employers with fewer than 30 workers will pay a reduced amount.

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