skip to content
Primary navigation

Leased employees

Reference: Law, §268.046 Subd.1

The term leased employees refers to a relationship where one legal entity provides labor to another legal entity on a continuing basis for a fee. All employee leasing firms (also commonly referred to as "professional employer organizations" or "PEOs") that operate in Minnesota must register with the Minnesota Department of Commerce before registering with the Minnesota Unemployment Insurance (UI) Program. Employee leasing firms must maintain separate UI employer accounts for each of their clients.

Owners/officers of a taxpaying employer that contracts with an employee leasing firm are in covered employment for the duration of the contract as an employee of the employee leasing firm. The wages of the owners/officers must be reported and taxes paid by the taxpaying employer.

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 website at by clicking Employers & Agents, Help and Support, then the UI Law link.

Back to the Table of Contents

back to top