In July 2023, Maine became the 13th state to pass into law paid family and medical leave. Although employees cannot start requesting paid family and medical leave benefits until May 2026, employers will be required to make payroll contributions into the fund starting January 2025. It is therefore important that businesses begin to consider how they will implement Maine’s Paid Family and Medical Leave requirements into their policies and procedures.
This article provides an overview of the Maine Paid Family and Medical Leave law’s timeline, payroll‑deduction and employer‑contribution obligations, employee benefits, and other considerations for Maine businesses. This article also considers how Maine employers should start preparing for 2025 and beyond.
Implementation Dates
- In July 2023, Governor Janet Mills passed and signed into law the Maine Paid Family and Medical Leave law.
- On January 25, 2024, Governor Janet Mills announced her nominations to the Paid Family and Medical Leave Benefits Authority, which has been established to implement and administer Maine’s new program.
- Beginning January 1, 2025, businesses covered by Maine’s Paid Family and Medical Leave law will be required to make payroll deductions and contributions to fund the program.
- Beginning May 1, 2026, employees may start applying for and receiving benefits under Maine’s Paid Family and Medical Leave program.
Payroll Contributions
The Maine Paid Family and Medical Leave program is funded through required payroll deductions and employer contributions. The payroll contribution is currently set at 1% of the employee’s wages, which is split between the employer and the employee. Small businesses (i.e., those with less than 15 employees), however, are exempt from the employer’s share of the contribution and will only be required to withhold 50% of the premium from the employee’s wages.
- Self-Employed Individuals. Self-employed individuals may elect coverage under the Maine Paid Family and Medical Leave program. If coverage is elected, self-employed individuals must pay 0.5% of their wages to the program.
- Employers with less than 15 employees. Employers who employ less than 15 employees are only required to contribute 0.5% of employee wages to the program, and employers may deduct this 0.5% of from employee wages to pay the premium.
- Employers with 15 or more employees. Employers who employ 15 or more employees are required to contribute 1% of employee wages to the program. Employers may deduct up to 0.5% from employee payroll; however, the employer must contribute the other 0.5% of the premium.
The Employee Benefit
An employee is covered by the Maine Paid Family and Medical Leave law if they (1) have earned at least 6X the state average weekly wage in wages that are subject to premiums, and (2) have a qualifying reason for family or medical leave. An employee is eligible for paid family or medical leave for the following qualifying reasons:
- The covered employee has a serious health condition;
- To bond with a covered employee’s child during the first 12 months after the child’s birth or placement of the child for adoption or foster care with the covered employee;
- To care for a family member with a serious health condition;
- To attend to an U.S. Armed Forces foreign deployment of a covered employee’s spouse, son, daughter, or parent;
- To care for a family member of the covered employee who is a service member in the U.S. Armed Forces (including the National Guard and Army Reserves) and, as a result of their service, is temporary disabled or undergoing medical treatment, recuperation, therapy, or outpatient treatment;
- To take safe leave if a covered employee or their family member is a victim of violence, assault, sexual assault, stalking, or any other act that would require an order for protection; or
- Any other qualifying reason allowed under the Maine Family and Medical Leave law.
A covered employee is eligible for only 12 weeks of paid family and medical leave in a benefit year. An employee, however, may take intermittent leave that accumulates up to the 12 weeks in a benefit year. Leave under the Maine Paid Family and Medical Leave law runs concurrently with state and federal FMLA leave. The amount of the employee benefit will be based on the employee’s average weekly wage and how those wages compare to Maine’s average weekly wage.
Other Considerations for Businesses
- If an employee takes paid family or medical leave, the employee’s rights to accrue vacation time, sick time, bonuses, advancement, seniority, length of service credit or other employment benefits, plans, or program cannot be affected.
- An employer cannot compel an employee to exhaust their rights to any sick, vacation, or personal time prior to or while taking paid family or medical leave.
- The Maine Paid Family and Medical Leave program does not obviate an employer’s obligations under an employer’s already established policies or collective bargaining agreement or employment agreement.
- Employers may apply for approval of a private plan in lieu of participating in the Maine Paid Family and Medical Leave program. An Employer’s private plan must provide substantially equivalent rights, protections, and benefits as the Maine Paid Family and Medical Leave law, and they must meet additional statutory requirements.
How Maine Businesses Should Prepare for 2025 and Beyond
Maine employers should provide their employees with advance notice of the additional payroll deduction that will begin in January 2025, and businesses should begin to draft employment policies around paid family and medical leave. A good way to begin notifying your employees and creating policies around the Maine Paid Family and Medical Leave is through creating or updating an employee handbook.
If your business employs at least 15 employees, you should also begin to include the premium into your annual budgeting process. Finally, Business should monitor the administrative rules that will be published by the Paid Family and Medical Leave Benefits Authority sometime in Spring 2024.
The Employment Practice Group and Business and Corporate Law Practice Group at Perkins Thompson are closely monitoring the Maine Paid Family and Medical Leave law, administrative rule making process, and program administration. If you have questions about how your business or company should begin preparing for and implementing this new program, you should contact an attorney in these practice groups for a consultation.
