Minnesota Federal District Court Rules That the MHRA Does Not Apply to Workers Who Do Not Work in Minnesota at the Time of Termination

In the legal case Walton v. Medtronic USA, Inc., a federal district court in Minnesota ruled that the Minnesota Human Rights Act (MHRA) does not apply to an employee who does not reside or work in Minnesota at the time of their termination, even if they have previously traveled to Minnesota for work. This decision was based on the definition of “employee” under the MHRA, which states that an individual is an “employee” if they reside or work in the state.

The case involved a long-time employee who was terminated as part of a business unit reorganization and replaced by a black woman. The employee, who lived and worked in Kansas, had previously traveled to Minnesota about four times a year but had not been to Minnesota for twenty months prior to his termination. The employee sued his former employer under the MHRA, claiming discrimination. However, the court dismissed the employee’s MHRA claims because he was not an employee covered by the statute, as he did not work in Minnesota at the time of his termination.

The court also considered the implications of the choice-of-law clause in the employee’s employment agreement, which stated that Minnesota law governed. The court determined that the choice-of-law clause could not compel the court to apply the MHRA—an inapplicable state law—simply because the clause requested that Minnesota state law be applied.

The court’s decision indicates that the location of the worker, not the employer, is the relevant factor in determining whether a worker works in the state. The court also noted that there will be many situations that exist on a spectrum, and close calls will need to be determined by juries.

Employers with remote workers living and working in other states should take note of these findings. First, the court’s decision suggests that past presence in the state may not be enough for the protections of the MHRA to extend to the employee. Second, employers should be aware of the limitations the court imposed on choice-of-law clauses in employment agreements.

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