Minnesota Supreme Court Sets the Record Straight on Municipal Employer Liability

A recent court decision has changed how Minnesota courts analyze whether municipalities may be liable for their hiring decisions—emphasizing that municipal immunity has its limits.

Historically, Minnesota law generally shielded a municipality’s hiring decisions from liability under the commonly used discretionary-function exception. In the recent case of Minor Doe 601 v. Best Academy et al., the Minnesota Supreme Court held that this exception is not automatic—and it should not allow a municipality to escape liability from a negligent hire, unless the hiring decision truly reflected policy-level decisions. This case sets the precedent in Minnesota that municipality employers cannot forego due diligence when it comes to taking proper safety precautions through screening and employment verifications.

The Catalyst

Historically, Minnesotan municipalities have been protected from tort liability for policy-level decisions under the discretionary-function exception, Minnesota Statutes section 466.03, subdivision six. In Minnesota, a charter school may be considered a municipality, along with any city, county, town, public authority, public corporation, special district, school district, or other political subdivision. Also in Minnesota, a municipality’s hiring decisions were categorically considered policy-level decisions. In other words, in most cases, a municipality’s hiring decisions have been historically protected from liability for employee misconduct—including charter schools.

On February 26, 2025, the Minnesota Supreme Court decided a case that likely sets a new tone for what municipal employers might expect in terms of liability when making hiring and employment decisions in the future.

Minor Doe 601 v. Best Academy

In the case of Minor Doe 601 v. Best Academy et al., a student filed a lawsuit against their charter school after being sexually assaulted by a teacher employed by the school. This teacher had a history of sexual abuse allegations from his previous employment, which the school did not discover in its hiring process.

Lower courts concluded that the charter school was categorically and necessarily immune from liability under the discretionary-function exception to municipal tort liability. The Minnesota Supreme Court disagreed.

The Minnesota Supreme Court held that the discretionary-function exception should not be applied broadly, and that a municipality must present evidence that its decisions involve balancing competing economic, social, political, and financial considerations for the exception to apply.

In this case, the Minnesota Supreme Court reversed the lower courts' decisions, holding that the charter school did not present sufficient evidence to justify applying the discretionary-function exception, and the court allowed the lawsuit to proceed. In other words, the charter school could be held liable for negligently hiring a teacher who sexually abused the school’s students.

What this means for Minnesota municipalities

The Minnesota Supreme Court's conclusion emphasizes that municipalities are not always immune from liability for their hiring decisions, meaning that any organization classified as a municipality in Minnesota should perform hiring due diligence.

One issue that arose in Minor Doe 601 v. Best Academy was the fact that the charter school did not obtain reference letters or contact references, which may have prevented the school from hiring the teacher. Thorough screening and verifications can help keep students and employees safe and may mitigate a municipality's liability about its hiring decisions and practices. While this case specifically pertains to Minnesota, the principles outlined in the decision can serve as a valuable reminder for HR professionals nationwide to ensure their hiring processes are robust and comprehensive.

Interested in learning more about screening and employment verifications? Reach out to your Account Manager, or contact us to learn more.

This article is for informational purposes only and does not constitute legal advice or official predictions of future laws and regulations. Hiring professionals, HR professionals, and administrators should consult their legal counsel to ensure all actions comply with the law.