On July 11, 2023, Governor Mills signed into law the Maine state budget in 2023 Public Law Chapter 412, which includes the creation of a paid family and medical leave program. Maine is the 13th state to enact such a program. Under the new program, beginning in 2026, eligible workers in both the private and public sectors will be able to take up to 12 weeks of paid family and medical leave for reasons such as personal illness, care for a sick relative, or leave for the birth of a child. Below is a summary of the benefits provided under the Paid Family and Medical Leave Program (the “Program”).
Program Eligibility and Benefits
The Paid Family and Medical Leave Program will be administered by the Maine Department of Labor (“MEDOL”) and shall be effective as of January 1, 2026. The Program covers eligible employees of eligible employers, including but not limited to private businesses, the State, municipalities, and tribal governments. The Program will provide up to 12 weeks of paid leave in a benefit year, which may be taken intermittently in increments of not less than 8 hours or on a reduced leave schedule agreed to by the employee and his/her employer. Except in cases of emergency, eligible employees must give reasonable notice of their intent to use leave to their employers, and an employee’s use of leave may not affect his/her right to accrue vacation time, sick time, bonuses, advancement, seniority, length of service credit, or other employment benefits, plans, or programs.
The Program itself will be funded by employer and employee premium payments that will begin January 1, 2025, and that may not be more than a combined rate of 1% of wages. Employers with 15 or more employees may deduct up to 50% of the premium required for an employee from that employee’s wages and shall remit 100% of the combined premium contribution required to the Program’s benefit fund. Employers with less than 15 employees may deduct up to 50% of the premium required for an employee from that employee’s wages and shall remit that amount to the fund. Self-employed individuals who elect coverage under the Program shall pay 50% of the premium required. Beginning in 2028, and for each calendar year thereafter, the MEDOL will set the premium for the coming calendar year based on a percentage of employee wages at a rate necessary to maintain the solvency of fund. Furthermore, employers that fail to make required premium contributions will be assessed a penalty equal to 1% of its total annual payroll for each year it failed to comply, in addition to amounts previously owed, as well as the total amount of family and medical leave benefits paid to covered individuals for whom it failed to make premium payments.
With respect to Program benefits, benefit payments to covered individuals are not payable during the first 7 calendar days of leave, but employees may use other employer-provided sick/vacation/paid leave during the first 7 days the employee is absent from work. Covered employees are eligible to receive (i) up to 90% of their average weekly wage that is equal to or less than 50% of the state average weekly wage, and (ii) up to 66% of their average weekly wage that is more than 50% of the state average weekly wage. The maximum weekly benefit amount shall be the state average weekly wage, and such benefit shall be prorated if leave is taken on an intermittent or reduced leave schedule. The weekly benefit amount will be reduced by other government wages or wage replacement, or benefits from an employer permanent disability policy or program.
Self-employed individuals, including independent contractors and sole proprietors, may elect to participate in the Program and receive coverage for an initial period of not less than 3 years, with such election becoming effective on the date of filing written notice with the MEDOL Commissioner. Self-employed individuals may withdraw from coverage within 30 days after the end of the 3 year period of coverage by filing written notice with the Commissioner. Notably, self-employed individuals who have elected to receive coverage, but have failed or refused to make premium payments for at least 2 quarters, may be disqualified from receiving leave benefits.
Private Plans, Collective Bargaining, & Concurrent Leave
An employer with an approved private plan is not required to remit premiums to the fund. Employers with private plans may apply to the MEDOL for approval to meet its obligations under the law through a private plan. In order to be approved, a private plan must confer rights, protections, and benefits substantially equivalent to those provided to employees under the Program.
The establishment of the Program does not eliminate an employer’s obligations to comply with any employer policy, law, or collective bargaining agreement that provides for greater/additional rights than those provided under the Program. The Program also may not curtail the rights of an employee subject to a collective bargaining agreement or employment contract. The Program does not prevent an employer from compelling an employee to exhaust any rights to sick, vacation, or personal time prior to or while taking leave under the Program. Leave taken under the Program shall also run concurrently with any leave taken under the federal FMLA.
Reasons for Taking Leave
A covered individual is eligible for leave for any of the following reasons:
- To bond with the covered individual’s child or adopted child during the first 12 months after the child’s birth or adoption;
- To care for a family member with a serious health condition;
- To attend a qualifying exigency;
- To care for a family member who is a covered military service member;
- To take safe leave as a result of violence, sexual assault, or stalking;
- For personal medical leave for a serious health condition;
- To donate an organ for human organ transplant;
- For leave following the death of a family member; and/or
- Other reasons as prescribed by law.
Notice and Return to Work
As part of the Program, employers must provide notice of benefits available under the Program in a conspicuous place at each of its locations, and shall provide an employee with written information about the Program within 30 days of the beginning date of an employee’s employment. Additionally, employers must allow an employee that exercises their rights to benefits under the Program to return to work in the position held by the employee when leave commenced, or to an equivalent position with equivalent benefits, pay, and other terms and conditions of employment. Furthermore, employers may not retaliate against an employee for exercising their right to benefits under the Program.
The law requires the MEDOL to publish detailed guidance and regulations. Such guidance and regulations must be published no later than January 1, 2025. The Program’s administrator also shall establish reasonable procedures and forms for filing claims for benefits, and shall specify the supporting documentation necessary to support any claim for benefits.
Summary of Important Dates
- October 2023: Budget goes into effect
- January 2024: Maine DOL begins rulemaking process
- January 1, 2025: Initial Paid Family and Medical Leave Program rules adopted
- January 1, 2025: Employer/employee contributions to the Program begin
- May 1, 2026: Claims for benefits begin being processed
Should you have any questions about the Program, please contact Eaton Peabody Employee Benefits Practice Group attorneys Jack Bjorn (email@example.com), Ed Feibel (firstname.lastname@example.org), or Anne O’Donovan (email@example.com) for additional assistance.