Most people don’t realize Minnesota has some of the strongest expense reimbursement laws in the country. Seriously. If you travel for work, your employer has to pay you back. And they can’t just ignore your receipts and hope you forget about it.
Here’s the thing. Minnesota doesn’t mess around when it comes to protecting workers. The state requires employers to reimburse you for necessary business expenses. That includes travel. Let’s break down exactly how this works and what you’re entitled to.
What Is Per Diem?
Per diem means “per day” in Latin. It’s money your employer gives you to cover daily expenses when you travel for work. This typically includes hotel costs and meals.
The federal government sets standard per diem rates through the General Services Administration (GSA). These rates tell you how much businesses should pay for lodging and food in different cities. Many private companies use these same rates.
But here’s where Minnesota gets interesting. The state doesn’t actually require employers to use per diem. Instead, Minnesota law says employers must reimburse you for actual business expenses. You’ve got options.
Minnesota’s Employee Protection Laws
Minnesota Statute 177.24 is the law that protects you. This statute says employers cannot make you pay for stuff you need to do your job. Pretty straightforward.
The law specifically covers four things. Uniforms or special clothing your employer requires. Equipment you need for work. Supplies you use on the job. And travel expenses related to your employment.
Travel expenses means everything. Hotels. Meals. Gas. Parking. All of it. If you spent money doing your job, your employer has to pay you back.
Sound too good to be true? It’s not. This law applies to almost all private sector employees in Minnesota.
How Per Diem Rates Work in Minnesota
Wondering what rates apply in Minnesota? Let me break it down.
For the 2026 fiscal year (October 2025 through September 2026), the GSA sets different rates for different areas. Minneapolis and St. Paul have their own rates. So does Duluth. Everywhere else uses the standard rate.
Minneapolis and St. Paul Rates
If you’re traveling to the Twin Cities, here’s what applies. Lodging is $148 per night. Meals and incidental expenses (M&IE) are $92 per day.
Wait, what are incidental expenses? Good question. These include tips, laundry, and other small costs. The $92 covers everything except your hotel.
One important rule: On your first and last travel days, you only get 75% of the M&IE rate. That’s $69 instead of $92. Makes sense since you’re not gone all day.
Standard Minnesota Rates
For most other cities in Minnesota, the standard CONUS rate applies. CONUS just means “continental United States.” Nothing fancy.
The standard rate for 2026 is $110 per night for lodging. M&IE is $68 per day. Again, first and last days drop to 75%, which is $51.
Duluth and Seasonal Rates
Duluth gets special treatment because it’s a tourist destination. The lodging rate is $127 per night. M&IE follows standard rates.
Some Minnesota cities have seasonal rates that change throughout the year. This reflects higher hotel costs during peak tourist seasons. Pretty smart, actually.
What Minnesota Law Actually Requires
Here’s where things get real. Minnesota doesn’t require your employer to pay per diem specifically. The law requires reimbursement for actual expenses.
You can track every receipt and get paid exactly what you spent. Or your employer can set up a per diem policy. Either way works, as long as you’re getting reimbursed fully.
Most employers choose per diem because it’s simpler. They set rates based on GSA standards. Everyone knows what to expect. Less paperwork for everyone.
Using GSA rates is considered a “highly defensible” approach in Minnesota. Courts recognize these rates as reasonable. Your employer can feel confident they’re meeting their legal obligations.
Your Rights as an Employee
Let’s talk about your rights. You’re not alone in wondering about this.
Minnesota law says you cannot be forced to pay for your employer’s business costs. If they send you somewhere for work, they cover the expenses. End of story.
This applies whether you’re salaried or hourly. Full-time or part-time. High wage or minimum wage. The law protects everyone equally.
Confused about what counts as a necessary expense? Here’s a simple test. If you had to spend the money to do your job, it’s necessary. Your employer owes you reimbursement.
What Happens at Termination
Hold on, this part is important. Minnesota has a special rule about what happens when you quit or get fired.
Employers must reimburse you for all business expenses when your employment ends. They can’t just keep the money. They can’t delay payment hoping you’ll forget.
The law says reimbursement must happen at termination. Not next month. Not after they review things. Right away.
If your employer took money from your paycheck for uniforms or equipment, they have to pay it back. The only exception is if they let you keep the items. Then they can require you to return them.
Private Sector vs. Government Employees
Minnesota law treats private sector employees differently from government workers. Let me explain the difference.
Private sector employees are covered by Minnesota Statute 177.24. That’s the mandatory reimbursement law we’ve been talking about. Your employer has to reimburse necessary business expenses.
Government employees follow different rules. State agencies use their own per diem policies. These are often based on collective bargaining agreements. Different agencies might have slightly different rates.
For example, state employees might get specific meal allowances. Breakfast could be $11. Lunch $13. Dinner $19. These amounts can vary based on contracts.
How to Handle Business Travel Expenses
Okay, so you’re traveling for work. What should you actually do?
First, get approval before you travel. Most employers want advance notice. This protects both of you. No surprises about whether the trip was necessary.
Keep every receipt. Hotel bills. Restaurant receipts. Parking stubs. Gas station receipts. Everything. You’ll need proof of what you spent.
Submit your expenses promptly. Many companies have deadlines like 30 or 60 days. Don’t wait months to turn things in. The faster you submit, the faster you get paid.
If your employer uses per diem, know the rates before you go. This helps you budget. You’ll know how much you have to spend each day.
When Per Diem Doesn’t Cover Everything
What happens if your actual costs are higher than per diem? Good question.
Under Minnesota law, your employer must cover necessary expenses. If per diem rates don’t fully reimburse you, they need to pay the difference.
Let’s say you’re in downtown Minneapolis for a conference. Hotel rooms near the convention center cost $200. But the per diem is only $148. You’re short $52.
Technically, your employer should pay the actual cost. Minnesota’s law focuses on full reimbursement, not arbitrary limits. But this can vary based on company policy.
Talk to your employer before booking expensive hotels. Work it out in advance. Some companies approve higher amounts for special circumstances. Others require you to find cheaper options.
Common Mistakes to Avoid
Not sure what counts as a valid business expense? Most people get confused about this.
Commuting doesn’t count. Travel from your home to your regular workplace isn’t reimbursable. Minnesota law specifically excludes this. Makes sense since that’s your personal choice where to live.
Personal expenses don’t count either. If you extend a business trip for vacation, those extra days are on you. Only the actual work-related portion gets reimbursed.
Don’t guess at amounts. Keep actual receipts. Estimates and approximations can cause problems. Your employer needs documentation to process reimbursements.
Don’t wait too long to submit expenses. Many companies won’t reimburse old expenses. There are often deadlines written into company policies. Miss the deadline, lose your money.
What If Your Employer Refuses to Pay
So what happens if your employer won’t reimburse you? You’ve got options.
First, document everything. Save all receipts. Keep copies of expense reports you submitted. Write down conversations about the expenses.
Talk to your employer’s HR department. Sometimes it’s just a misunderstanding or paperwork issue. Give them a chance to fix it.
If that doesn’t work, you can file a complaint with the Minnesota Department of Labor and Industry. They enforce wage and hour laws, including expense reimbursement.
You can also sue in civil court. Minnesota law allows employees to recover twice the amount of unpaid expenses. That’s right, double damages. Plus potentially attorney fees.
Honestly, most employers don’t want legal trouble. Once you mention the law, they usually pay up. But know your rights just in case.
Tips for Employers
If you’re an employer reading this, listen up. Compliance is easier than you think.
Set up a clear expense reimbursement policy. Put it in writing. Make sure employees know what’s covered and what’s not. Clear policies prevent disputes.
Use GSA rates as your baseline. These rates are updated annually and recognized as reasonable. You’re on solid legal ground using them.
Process reimbursements quickly. Don’t make employees wait months for their money. They spent their own cash for your business. Pay them back promptly.
Keep good records. Document all reimbursements. This protects you if questions come up later. Good recordkeeping is your friend.
Consider using expense management software. It automates rate calculations and tracks everything. Less room for human error. Employees get paid faster.
How Minnesota Compares to Other States
Minnesota’s law is actually pretty strong compared to most states. Trust me on this.
Many states don’t require any expense reimbursement at all. Or they only require it if expenses would drop wages below minimum wage. Minnesota protects all employees regardless of wage level.
California has similar strong protections. Illinois too. But most states? Not so much. Minnesota employees are lucky to have these protections.
The law covers expenses “in the course of employment.” That’s pretty broad language. It includes more than just travel. It’s comprehensive protection.
Staying Compliant in 2026
What should you know for 2026? Here are the key updates.
The GSA rates for fiscal year 2026 remain the same as 2025. No changes. The government analyzed travel costs and decided current rates are still appropriate.
Standard CONUS rate: $110 lodging, $68 M&IE. Minneapolis/St. Paul: $148 lodging, $92 M&IE. These amounts apply from October 2025 through September 2026.
Minnesota’s underlying law hasn’t changed. Statute 177.24 still requires full reimbursement of necessary business expenses. Same as before.
The key is documentation. Keep receipts. Track expenses. Submit promptly. Follow your employer’s procedures. Do these things and you’ll be fine.
Frequently Asked Questions
Does Minnesota require employers to pay per diem? No, Minnesota doesn’t specifically require per diem. The state requires employers to reimburse necessary business expenses. Employers can use per diem rates or reimburse actual expenses.
What are the 2026 per diem rates for Minnesota? Minneapolis/St. Paul: $148 lodging and $92 meals/incidentals. Standard rate (rest of Minnesota): $110 lodging and $68 meals/incidentals. Rates are set by the federal GSA.
Can my employer refuse to reimburse my travel expenses? No. Minnesota law requires employers to reimburse necessary business travel expenses. If they refuse, you can file a complaint or sue for twice the amount owed.
Do I have to use per diem or can I submit actual expenses? You can submit actual expenses with receipts. Many employers prefer per diem for simplicity, but Minnesota law focuses on full reimbursement of actual costs.
What happens to unreimbursed expenses when I quit? Your employer must reimburse all business expenses when your employment ends. They cannot withhold or delay payment. This is specifically required by Minnesota law.
Are tips included in per diem rates? Yes. The meals and incidental expenses (M&IE) rate includes reasonable tips. You don’t need separate reimbursement for gratuities given during business travel.
Can my employer pay less than GSA rates? Only if their lower rate fully covers your actual expenses. Minnesota requires full reimbursement. Using rates lower than GSA could violate the law if employees aren’t fully reimbursed.
Does the law apply to remote workers? Yes, if remote workers incur necessary business expenses. This could include home office supplies or equipment required by the employer. Minnesota’s law is broad.
Final Thoughts
Now you know the basics. Minnesota protects employees through strong reimbursement laws. Your employer must pay for necessary business expenses, including travel.
The state doesn’t set specific per diem rates. Instead, most businesses use federal GSA rates as their standard. These rates are reasonable and legally defensible.
Keep good records of your expenses. Submit reimbursement requests on time. Know your rights under Minnesota law. And don’t let employers take advantage.
If you’re traveling for work in Minnesota, you deserve to be reimbursed. The law is on your side. Stay informed, document everything, and don’t be afraid to speak up if something seems wrong.
References
- Minnesota Statute 177.24 – Payment of Minimum Wages and Expense Reimbursement https://www.revisor.mn.gov/statutes/cite/177.24
- U.S. General Services Administration – FY 2026 Per Diem Rates https://www.gsa.gov/travel/plan-book/per-diem-rates
- Minnesota Department of Labor and Industry – Wage and Hour Information https://www.dli.mn.gov/business/employment-practices/wage-and-hour-laws
- Federal Per Diem Rates for Minnesota https://www.federalpay.org/perdiem/2026/minnesota
- Minnesota Employment Law Guide – Expense Reimbursement Requirements https://www.mcguirewoods.com/client-resources/alerts/2020/3/navigating-expense-reimbursement-for-work-from-home-employees/
