Legal Update: Earned Paid Leave

After much anticipation, the Maine Department of Labor (“MEDOL”) has issued final rulemaking for the Earned Paid Leave Law that goes into effect on January 1, 2021. A summary of how the law will apply is below. Please contact Eaton Peabody’s Labor and Employment Group with any questions or for help incorporating this law into your business’ paid leave policies.

Maine’s new “Act Authorizing Earned Employee Leave” requires all employers in the State of Maine with more than ten total employees for more than 120 calendar days in any given year to provide Earned Paid Leave (hereafter “EPL”) to all employees. All employees means exactly what it sounds like – full time, part time, per diem, temporary, etc. – there are no exceptions or categories of employees who are not entitled to EPL.

Employees will be entitled to earn a minimum of one hour of EPL for every 40 hours worked. This is a minimum standard, so employers may provide more EPL or use a faster rate of accrual at the employer’s discretion. Employees are entitled to earn up to 40 total hours of EPL under the law, but again, this is a minimum standard and employers may offer more than 40 hours of EPL to employees at their discretion. Employers may also front load EPL rather than having it accrue based on hours worked, as long as the amount of leave is equivalent to or greater than what the employee would have earned through the minimum accrual rate. For salaried employees or other employees who do not record their hours worked, MEDOL has clarified that those employees are presumed to work 40 hours per week and thus entitled to earn one hour of EPL per week.

Up to 40 hours of EPL may be carried over from one year to the next, and should not be treated as a “use it or lose it” situation. MEDOL has indicated that they did this so that employees will not feel inclined to use up all remaining EPL at the end of the year and create scheduling challenges for employers. Employers are only required to provide a total of 40 hours of paid leave per year for use, including any amount that rolled over from the previous year. This means that if an employee rolls over eight hours of unused EPL from 2021 to 2022, the employee can only earn up to an additional 32 hours in 2022.

Employers must allow employees to take leave in a minimum of one hour increments. Employers may elect to allow shorter increments of leave if they so choose.

Employers may prevent employees from using accrued EPL until after 120 days of employment with the employer. This applies to new employees only, and anyone employed for at least 120 days in the year prior to the enactment of the law will be entitled to use their EPL immediately.

Employers may not prevent employees for using leave for any reason, so this leave may not be restricted to sick leave only, vacation leave only, etc. However, employers may require up to 4 weeks’ notice for non-emergency leave. Employees must provide notice as soon as feasible under the circumstances for any leave taken for an emergency, illness, or sudden necessity. Determining what is feasible will be a fact specific inquiry depending on the specific situation in question, and employers should note that there will be circumstances under which advance notice is not possible. Employers can require a shorter period of notice for foreseeable leave if they choose to, and should clearly establish their procedures and policies for requesting leave. MEDOL has determined that employers may require requests for leave to be in writing, but writings may include text messages or emails.

Employer policies regarding paying out vacation time upon termination of employment will also apply to EPL. Employees who leave employment and return to the same employer within one year are entitled to any unused accrued paid time off that was available to them at the time of separation if the EPL was not paid out at the time of separation.

Employers may, at their discretion, designate times of the year when leave requests will be restricted due to operational needs. During these periods, employers must still provide leave for an emergency, illness, or sudden necessity. The MEDOL uses emergency and sudden necessity interchangeably, and define them as a situation in which the need for leave is not reasonably foreseeable.

Employers may not mandate that an employee use paid leave if the employer causes employee to be out of work (i.e. business is closed, shift is cancelled). Employers may not deny an employee the right to use paid leave in accordance with the law or the MEDOL rules. Employees generally may not limit the reason for which the employee wishes to take leave, subject to the appropriate notification requirements for foreseeable leave. Employers also generally may not require documentation or evidence of an employee’s emergency, illness, or other sudden necessity short of requiring a general description such as that the employee or a family member is ill. Employers may not require medical documentation from an employee unless the employee is absent for at least three consecutive days.

Collective Bargaining Agreements that are currently in place shall remain in effect until they expire. Any Collective Bargaining Agreements entered into after January 1, 2021 must meet or exceed the standard for EPL as set forth under the law.

Notably, MEDOL has created a poster detailing employee rights under the new law, which all employers are required to post at their workplaces. Access the poster here. MEDOL has also provided a helpful FAQ, which can be accessed here.