Employment In More Than One State

Reference: Minnesota Law, §268.042 Subd.4 (2007)

When an employee performs services in Minnesota and at least one other state, use the following tests to determine whether wages paid to the worker must be reported to the Minnesota Unemployment Insurance (UI) Program.

Wages paid to an employee who was covered under the unemployment insurance law of another state do not count toward the Minnesota taxable wage base.

NOTE: Consider only the employee’s primary duties. Do not include time spent attending periodic meetings, commuting, or other incidental, temporary, or transitory duties.

Apply the following tests on a calendar quarter basis and in the order shown.

1. Localization. An employee’s services are "localized" and covered in Minnesota if 80 percent or more are performed in Minnesota.
2. Base of operation. If test one does not apply, an employee’s services are covered in Minnesota if some services are performed in Minnesota and the employee’s base of operation is in Minnesota. “Base of operation” means the place, usually permanent in nature, from which the employee starts working and to which he or she customarily returns. It can also be the place to which the employee returns to receive instructions or messages.
3. Place of direction and control. If tests one and two do not apply, an employee’s services are covered in Minnesota if some services are performed in Minnesota and the place from which an employer directs and controls the employee is in Minnesota. Generally, the employer’s headquarters would be the place from which they direct and control the employee.
4. Residence of employee. If tests one, two and three do not apply, the employee’s services are covered in Minnesota if some services are performed in Minnesota and the employee’s residence is in Minnesota.

If the tests above do not apply and the individual’s services are not covered under the laws of another state or Canada, the services are covered in Minnesota if the employer directs and controls them from Minnesota.

NOTE: If an employee permanently transfers from a job location in another state to a job location in Minnesota, the multi-state employment tests do not apply. Wages paid to the employee for services performed before the transfer are reportable to the first state, and covered wages paid for services performed after the transfer are reportable to Minnesota.

      

This handbook is based on current UI legislation; statements are intended for general information and do not have the effect of law. The Minnesota Unemployment Insurance Law - MN Statutes §268.001 to §268.23 and Administrative Rules 3310 and 3315 - can be accessed through our Web site at www.uimn.org; by clicking on the UI Law link.