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HF2567 (Legislative Session 94 (2025-2026))

Stay-or-pay provisions made prohibited, unenforceable, and against public policy.

Related bill: SF2533

AI Generated Summary

Purpose of the Bill

The primary purpose of this bill is to address the validity of "stay or pay" provisions in employment contracts within the state of Minnesota. These provisions are deemed unenforceable, against public policy, and therefore are prohibited under this proposed legislation.

Main Provisions

  • Prohibition of Stay or Pay Provisions: The bill seeks to amend existing Minnesota employment statutes to explicitly prohibit "stay or pay" clauses. These are contractual provisions that typically require employees to stay in a job for a certain period or face penalties.
  • Commissioner Compliance Orders: The bill outlines the authority of the commissioner to enforce compliance with the prohibition of such provisions. Employers found violating the prohibition may be ordered to make corrections and comply with relevant employment sections.

Significant Changes to Existing Law

  • Amendment to Minnesota Statutes Section 177.27 Subdivision 4: The bill proposes an amendment to enhance the commissioner's power in issuing compliance orders concerning the prohibited "stay or pay" clauses.
  • New Provisions in Chapter 181: The bill proposes adding new sections to Minnesota Statutes Chapter 181 to codify these prohibitions and ensure they are enforceable under state law.

The bill reflects a legislative effort to align employment practices with public policy considerations that favor employee mobility and fairness.

Relevant Terms

  • Stay or pay provisions
  • Employment contracts
  • Unenforceable clauses
  • Public policy
  • Compliance orders
  • Minnesota Statutes Chapter 181

Bill text versions

Actions

DateChamberWhereTypeNameCommittee Name
March 19, 2025HouseFloorActionIntroduction and first reading, referred toWorkforce, Labor, and Economic Development Finance and Policy
March 23, 2025HouseFloorActionAuthor added

Citations

 
[
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Amends compliance orders for employment provisions under Minnesota Statutes section 177.27, subdivision 4.",
      "modified": [
        "Clarifies compliance process and objections for compliance orders issued to employers."
      ]
    },
    "citation": "177.27",
    "subdivision": "subdivision 4"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Allows the commissioner to promulgate rules under section 177.28 related to employment compliance.",
      "modified": []
    },
    "citation": "177.28",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Reference to rule promulgation under section 181.213 in relation to employment compliance orders.",
      "modified": []
    },
    "citation": "181.213",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Reference to rule promulgation under section 181.215 concerning employment compliance.",
      "modified": []
    },
    "citation": "181.215",
    "subdivision": ""
  }
]

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