Minnesota Democrats look for money to stave off federal cuts — and other labor news

Take a seat in the Break Room, our weekly round-up of labor news in Minnesota and beyond. This week: Minnesota Democrats hold out hope for softening budget cuts; bill would give teachers $1,200 bonuses; Minneapolis nursing home workers reach deal after strike; salary transparency may boost job applications; and DOGE cuts cost billions.

Democrats’ defiant news conferences

As the Trump administration takes a hatchet to federal programs, government workers have looked to the Legislature for a safe harbor.

Minnesota Democrats have been eager to answer that call, introducing a slew of tax and spending bills and offering a vision of St. Paul as a bulwark against the upheaval in Washington.

“We will fight to protect Minnesotans from the chaos, corruption and destruction from the Trump administration and federal Republicans,” said Sen. Erin Maye Quade, DFL-Apple Valley, at a news conference with several dozen other Democrats and activists on the Capitol steps on Thursday.

“We cannot accept the false trade-offs between education and health care, between public safety and the environment, between disability services and roads and bridges,” she said.

Democrats have bills to raise taxes on the top fifth of earners, corporations and luxury goods that could help offset Republican-proposed cuts to Medicaid. They have a bill to fund public health functions (for a yet unspecified amount), as federal cuts have led to layoffs in the state Department of Health. They have a bill to give $16 million to Minitex, a little-known library service facing significant federal budget cuts.

Earlier this month, Democrats held a news conference with federal workers to unveil bills that would extend unemployment benefits to those who accepted the “Fork in the Road” buy-out offer and give $10,000 to laid-off veterans who relocate to Minnesota. Both of those appear to have quickly stalled out.

Rep. Emma Greenman, DFL-Minneapolis, said Democrats are clear eyed that Minnesota can’t fix every problem created by federal cuts but need to show they’re trying to soften the blow.

“The alternative is to do nothing,” Greenman said. “We have to have ideas.”

(Two Senate Democrats — self-titled Blue Dogs — are an exception to the current aversion to talking about cuts with a proposal to reduce the benefits and taxes of the state’s new paid family leave law that launches Jan. 1.)

In the coming three weeks until the scheduled May 19 adjournment, defiant news conferences will turn into difficult closed-door negotiations as Democrats run up against the limits of their resources and power.

It’s an unfamiliar feeling: The last legislative session they controlled state government and a $17.5 billion surplus. Minnesota now faces a looming budget deficit and Republicans, who control half of the state House, say Democrats’ proposals are a fantasy.

They aim to use their new power to chip away at the sweeping progressive agenda Democrats passed in 2023-24 including unemployment benefits for hourly school workers, funding for light rail and subsidized health insurance for undocumented workers.

The Walz administration appears to be readying itself for deep cuts ahead. Minnesota Management and Budget, in negotiations with the union representing some 18,000 state employees, proposed creating an “emergency layoffs” process. That would allow the state to idle workers in the event of “fiscal exigencies” without having to follow the usual contractual procedures governing layoffs.

The relationship between the Walz administration and the Minnesota Association of Professional Employees union has soured since the governor ordered workers back to the office 50% of the time. MAPE leaders raised the prospect of a strike and compared Walz to Musk.

Walz didn’t invite them to his State of the State address this week.

Democrats float $1,200 bonuses for teachers

More than 70,000 licensed public and charter school teachers could receive $1,200 bonuses in the form of refundable tax credits under a bill pitched by Minnesota Democrats.

The bill (SF186) could help Minnesota schools struggling to attract and retain teachers, but the proposal must compete with a slew of other spending priorities as a gloomy budget forecast hangs over lawmakers crafting a two-year budget.

The credits would be expensive, estimated to cost about $100 million a year, but Walz has proposed sunsetting a program costing roughly $80 million a year that offers bonuses to school districts participating in the alternative teacher pay system known as Q Comp.

One of the competing spending priorities is helping school districts pay for unemployment benefits for school bus drivers and other hourly school workers. In 2023, Minnesota became the first in the nation to entitle school workers to unemployment benefits, which have long helped workers in construction and other seasonal jobs weather regular periods of unemployment.

Greenman, the bill author, told Axios Twin Cities that the benefit has achieved its goal and alleviated a shortage of bus drivers and other workers. Lawmakers gave school districts $135 million to cover the costs until June 2027 — or until the funding ran out. Now, the account only has enough to cover about half of what’s needed for this coming summer, Axios reported.

Walz and the DFL-led Senate have proposed allocating another $30 million to help school districts this year, with the Senate proposing an additional $70 million in aid the following year.

Democrats and SEIU, which represents unionized hourly school workers, scheduled a press conference on Friday to speak in support of keeping the unemployment benefits.

Minneapolis nursing home workers reach deal after strike

Around 80 nursing assistants, cooks, housekeepers and other workers at Providence Place nursing home in Minneapolis won 6% annual wage increases over the next two years after striking for two days last month.

A new nursing assistant will earn $21.48 per hour in 2025 and $22.56 per hour in 2026, in line with the average wage for nursing assistants across workplaces in Minnesota. The workers, who are unionized with SEIU Healthcare Minnesota & Iowa, also negotiated for 40 additional vacation hours and full benefits after their probationary period ends.

“We’re ready to take these gains and keep building towards our next bargaining in 2027 to win even more,” Amy Oliver, a Providence Place worker, said in a statement shared by the union.

Nursing home workers across the state are on track to receive significant pay increases under rules passed by the state’s new Nursing Home Workforce Standards Board, contingent upon funding from the state. By Jan. 1, 2027, certified nursing assistants in all nursing homes will earn at least $24 per hour under the rules approved last year.

Salary transparency may boost job applications

Twin Cities Business reports a new state law requiring employers to include salary ranges in job postings may be boosting the number of applications companies receive. Jenna Estlick of search firm Versique told the magazine that clients are seeing a “considerable” increase in job seekers since the law took effect Jan. 1.

That tracks with a number of other surveys showing job seekers are more likely to apply to postings when a salary range is included.

Minnesota is one of more than a dozen states that now require companies to disclose salary ranges, which proponents say can help reduce gender and racial pay gaps. It may also help current employees to negotiate for raises if open positions are advertised with higher salaries.

As of last year, Minnesota employers are also barred from asking job applicants about their current or previous pay in order to set compensation.

DOGE cuts cost billions

Trump’s Department of Government Efficiency initiative could end up costing the government about as much as its de facto leader Elon Musk promised to save, the New York Times reported.

The Partnership for Public Service, a nonprofit that studies the federal workforce, estimates DOGE will cost taxpayers upward of $135 billion this year in lost productivity, paid leave and the cost of carrying out the tens of thousands of firings and re-hirings. Cuts to the Internal Revenue Service leading to about 22,000 employees leaving could cost $2.4 trillion over 10 years, according to The Budget Lab, if tax noncompliance is allowed to rise unchecked.

Neither of these estimates includes the substantial cost of defending DOGE’s cuts in court.

Compare that to the $150 billion Musk said DOGE is likely to save taxpayers, down from the $2 trillion he originally promised to save.

“Not only is Musk vastly overinflating the money he has saved, he is not accounting for the exponentially larger waste that he is creating,” Max Stier, chief executive of the Partnership for Public Service, told the New York Times.

Trump continues to push forward with his assault on the federal workforce, this week issuing an executive order that would make probationary employees easier to fire.

*Correction: A previous version of this story misstated the cost estimate for unemployment insurance for hourly school workers. In 2023, the Department of Employment and Economic Development estimated it would cost $135 million annually.