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Summary: Both state and federal law provide employees with the right to take leave in order to serve in the military. At the federal level, leave rights are governed by the Uniformed Services Employment and Reemployment Rights Act (USERRA). In Minnesota, employees working for public entities are granted certain leave rights for military service. State pension plans may have provisions for purchase of service credit. Contact each pension plan directly for further information.
Effective August 1, 2008, employers in Minnesota are also required to grant unpaid leave under certain circumstances to employees for military events of their family members.
Military Pay Differential:
An employee of the State of Minnesota who is on a military leave of absence must be paid the difference between the employee’s salary and their military pay if the state salary exceeds the military pay. This policy came into effect with the revision of M.S. 192.26 and 192.261 (which originally provided for the initial 15 days of paid leave). This change was made effective May 29, 2003.
Follow-up memos from MMB have clarified how these payments should be treated. Effective in calendar year 2009, the military pay differential is treated as wages and will be subject to federal, state, and retirement withholding. These differential payments continue to be exempt from FICA and Medicare tax withholding. Payment under this section must not extend beyond four years from the date the employee reported for active service, plus any additional time the employee may be legally required to serve.
The employee must provide an official military pay statement in order to receive this benefit. Use assignment type 4006 to pay the military differential to eligible employees. | 
