Minnesota Workers’ Compensation Attestation Requirement for Franchise Filings
Franchisors filing initial registrations or annual renewals in Minnesota are now being asked to address workers’ compensation compliance as part of the franchise filing process. For many franchisors, especially those without employees or contractors in Minnesota, this means preparing a short attestation confirming that the franchisor is not required to maintain Minnesota workers’ compensation coverage.
The requirement may seem simple, but it should not be treated as a routine formality. The attestation is tied to Minnesota workers’ compensation law and false or inaccurate information can result in penalties and filing delays.
Minnesota franchise filings now require franchisors to address workers’ compensation status
Minnesota is a franchise registration state. A franchisor generally may not offer or sell a franchise in Minnesota unless its franchise registration is effective or an exemption applies. Initial franchise registrations and annual renewal filings are submitted through the Minnesota Department of Commerce, and the filing process now includes a workers’ compensation compliance component.
Under Minn. Stat. § 176.182, a state or local licensing agency must withhold the issuance or renewal of a license or permit to operate a business in Minnesota until the applicant provides acceptable evidence of compliance with Minnesota workers’ compensation insurance requirements. In the franchise registration context, this can require the franchisor to provide either insurance information or an attestation explaining why Minnesota workers’ compensation coverage is not required.
For franchisors with no employees in Minnesota and no independent contractors in Minnesota, the practical solution is often a signed attestation from an authorized officer. That attestation should be accurate, specific, and consistent with the franchisor’s actual operations.
If the Franchisor Has Minnesota Employees
The franchisor may need to provide the workers’ compensation insurance carrier name, policy number, and coverage dates, or proof of self insurance if applicable.
If the Franchisor Has No Minnesota Employees
The franchisor may need to submit an attestation confirming that it does not have employees or independent contractors in Minnesota and is not required to maintain Minnesota workers’ compensation coverage.
This is not just another filing attachment
Franchise registration filings are often deadline driven. A franchisor may be focused on audited financials, FDD updates, state addenda, redlines, consent letters, seller disclosures, and filing fees. The Minnesota workers’ compensation attestation adds another item that needs to be addressed before the state will complete its review.
Filing Delay Risk
An incomplete or missing attestation can slow down the initial registration or renewal process.
Accuracy Risk
The attestation should match the franchisor’s actual employee and contractor footprint in Minnesota.
Penalty Risk
Minnesota law provides for a $2,000 penalty if required information is not reported or is falsely reported.
The issue is especially important for franchisors with limited Minnesota activity
Many franchisors registered in Minnesota do not have a corporate office, employees, field staff, or contractors physically working in Minnesota. Their connection to the state may be limited to offering franchises, supporting Minnesota franchisees, collecting royalties, approving locations, or maintaining registration to permit franchise sales.
Those facts matter. A franchisor that truly has no Minnesota employees and does not use independent contractors in Minnesota may be able to provide a straightforward no employee attestation. But the answer should not be assumed. Before signing, the franchisor should review whether any trainers, sales representatives, field support personnel, consultants, construction managers, site selection vendors, operations personnel, or other individuals perform work in Minnesota on the franchisor’s behalf.
The safest approach is to treat the attestation as a legal certification, not a box checking exercise. Someone with authority and knowledge of the company’s operations should confirm the facts before signing.
- Does the franchisor have any employees living or working in Minnesota?
- Does anyone travel into Minnesota to provide training or support?
- Does the franchisor use Minnesota based consultants or contractors?
- Does the franchisor have Minnesota sales personnel or franchise brokers?
- Does the company’s actual footprint match the proposed attestation?
- Is the signer authorized to certify the statement on behalf of the company?
What a no employee attestation can look like
Waldrop and Colvin has been preparing Minnesota workers’ compensation attestations for franchisor clients as part of initial and renewal franchise filings. For a franchisor with no Minnesota employees or independent contractors, the attestation may look similar to the following:
Pursuant to Minn. Stat. § 176.182 and in connection with the Company’s franchise registration or renewal filing, please accept this letter as a formal attestation on behalf of the Company that:
(1) the Company does not have any employees in Minnesota, as that term is defined under Minn. Stat. § 176.011, subd. 9; and
(2) the Company does not use independent contractors in Minnesota.
Accordingly, the Company is not required to maintain workers’ compensation insurance coverage under Minn. Stat. § 176.181, subd. 2.
The undersigned certifies that the information provided herein is accurate and complete, that he or she is duly authorized to execute this attestation on behalf of the Company, and understands that providing false information may result in a penalty of $2,000 assessed by the Commissioner pursuant to Minn. Stat. § 176.182.
This language should be tailored to the franchisor’s actual circumstances. A franchisor with Minnesota employees, Minnesota contractors, or mixed operational facts should not use a no employee attestation without further review.
How the attestation fits into Minnesota franchise filings
Minnesota franchise registration is not a one time event. A franchisor must file an initial registration before offering or selling franchises in Minnesota unless an exemption applies, and the registration must be renewed annually if the franchisor intends to continue offering and selling franchises in the state.
Initial Franchise Registration
For a new Minnesota registration, the workers’ compensation attestation should be prepared as part of the initial filing package so the application is not delayed during review.
Annual Renewal Filing
For a renewal, the franchisor should review its Minnesota footprint again instead of simply recycling last year’s answer. A company’s personnel, contractors, and support model can change during the year.
This is particularly important for growing franchise systems. A franchisor that had no Minnesota presence last year may have added field support, hired remote personnel, engaged local vendors, or started more regular in state activity. The attestation should reflect current facts at the time of filing.
Where franchisors can get into trouble
The most common mistake is assuming the attestation is automatically true because the franchisor does not own a corporate office in Minnesota. Workers’ compensation questions are not limited to whether the company has a leased office or payroll department in the state.
Another mistake is assuming that independent contractor status is always clear. Depending on the facts, a worker labeled as an independent contractor may still create workers’ compensation or classification issues. For that reason, franchisors should review both employees and contractors before signing the attestation.
The attestation should also be consistent with the franchisor’s broader FDD disclosures. If the FDD describes Minnesota operations, company owned outlets, support personnel, affiliates, or business activity in a way that conflicts with the attestation, the filing may draw questions.
Assuming No Office Means No Issue
A franchisor can have Minnesota activity even without a corporate office in the state.
Ignoring Contractors
The attestation should address both employees and independent contractors in Minnesota.
Using Stale Information
Renewal filings should be based on current facts, not assumptions from a prior year.
Signing Too Quickly
The signer should have authority and a reasonable basis for certifying the statement.
What franchisors should do before signing
Before submitting a Minnesota attestation, franchisors should pause long enough to confirm the facts. The process does not need to be complicated, but it should be deliberate.
Review Personnel
Confirm whether the franchisor has employees living, working, training, selling, or supporting franchisees in Minnesota.
Review Contractors
Identify whether any consultants, trainers, franchise sales representatives, or field support vendors perform work in Minnesota.
Document the Basis
Keep a record of the internal review supporting the attestation in case questions arise during the filing process.
If Coverage Is Required
The franchisor should gather the carrier name, policy number, and coverage dates, or other acceptable evidence of compliance.
If Coverage Is Not Required
The franchisor should submit a tailored attestation explaining why it is not required to maintain Minnesota workers’ compensation coverage.
Small filing requirements can create large compliance problems if ignored
For franchisors, the Minnesota attestation requirement is a reminder that franchise registration is not limited to the FDD itself. State filings often involve a combination of franchise law, corporate authority, financial statement rules, consent forms, franchise seller disclosures, and now, in Minnesota, workers’ compensation compliance.
A franchisor that prepares early can usually handle this efficiently. A franchisor that waits until the state examiner asks for the attestation may lose valuable time during an initial registration or renewal cycle.
The key is to address the issue before filing, confirm the company’s Minnesota employment and contractor footprint, and submit an attestation that accurately reflects the franchisor’s actual operations.
If your franchise system is filing in Minnesota, do not assume the answer is obvious. Review your personnel, contractors, field support structure, and Minnesota activity before certifying whether workers’ compensation coverage is required.
Waldrop and Colvin helps franchisors manage state registration requirements
If your franchise system is preparing an initial registration, renewal, amendment, or response to comments in Minnesota, we can help you evaluate the workers’ compensation attestation requirement and prepare filing documents that match your company’s actual operations.
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This article is provided for general informational purposes only and does not constitute legal advice. Franchise filing requirements and employment related obligations can vary based on the facts. Franchisors should consult counsel before submitting certifications or attestations to a state regulator.
