Maine recently enacted one of the broadest and most generous paid family and medical leave programs in the country. L.D. 1964 provides up to 12 weeks of paid leave per year to all eligible employees in the private and public sector.
The plan permits employees to take leave to care for any individual with whom they have “a significant personal bond that is or is like a family relationship regardless of biological or legal relationship.” Employees can take paid leave immediately after starting employment.
To pay for this new program, the state will impose a 1% payroll tax, split evenly between the employer and employee. Maine will begin assessing the 1% payroll tax on Jan. 1, 2025. Employees will be able to start taking paid family and medical leave on Jan. 1, 2026.
Wage Replacement
During the leave, the program will replace 90 percent of an employee’s wages for income earned that is equal to or less than 50 percent of Maine’s average weekly wage, which is currently $1,036. The portion of the covered individual’s average weekly wage that is more than 50 percent of the state average weekly wage must be replaced at a rate of 66 percent up to the maximum weekly benefit. To calculate the benefit amount, the average weekly wages the individual earned over the preceding four calendar quarters will be used, but any earnings from bonuses will be excluded. The maximum weekly benefit is set at the state average weekly wage, which changes annually. Notably, benefits are not subject to state income tax.
Employers that offer comparable private paid leave plans can opt out of the program and cannot impose a cost to employees greater than the payroll tax under the state plan. Also, businesses with 15 or fewer workers would be exempt from paying into the state plan. However, employees of those small businesses, including part-time employees, still will be required to pay into the program and can still claim benefits.
Maine’s approach will affect all employers since all employees will be eligible for paid leave, regardless of whether the employer must pay the payroll tax.
The Department of Labor will administer the program. Oversight authority will rest with a newly created 13-member advisory board appointed by the governor.
Covered Employees
Public and private full- and part-time employees who have earned at least six times the state average weekly wage in the first four calendar quarters immediately preceding the first day of an individual’s benefit year are covered by the law. So long as the individual has earned at least $6,216 in the year prior to taking leave, they are covered.
Public employers (except the federal government), private employers, and self-employed individuals are covered by the program. Employers with fewer than 15 employees do not have to contribute toward the payroll tax, but they must collect and remit to the state the employee’s portion of the tax. Employees of small employers with fewer than 15 employees may still take paid family and medical leave – and can do so immediately upon commencing employment.
Private employers that offer equivalent or greater paid leave benefits may apply to the state for a waiver to avoid participating in the state’s program.
L.D. 1964 requires a covered public employer that is a party to a collective bargaining agreement (CBA) to apply the “rights and responsibilities” of the paid leave program until the existing CBA expires. For private employers that are a party to a CBA, the bill does not stop “an employer’s obligations to comply with any employer policy, law or collective bargaining agreement that provides for rights to leave greater than or additional to those provided by” the new state program.
So long as a covered employee has been employed for at least 120 days prior to taking leave, the employer must restore that employee to the same or equivalent position with the same or equivalent benefits, pay, and other conditions of employment. A covered employee who takes leave before working at least 120 days does not have the same job restoration rights.
However, L.D. 1964 includes a prohibition against retaliation for an employee exercising their right to paid family and medical leave. As a result, employers may potentially face retaliation claims from employees who take leave during their initial 120 days of employment who do not return to the same or similar job after their leave.
Reasons for Leave
Employees may take up to 12 weeks of paid leave for the following reasons:
- To care for the employee’s serious health condition.
- To care for a family member with a serious health condition.
- The birth of the employee’s child or the employee’s domestic partner’s child.
- To bond with the employee’s child during the first 12 months after the child’s birth, adoption or foster care placement.
- To attend to a qualifying exigency or need arising out of a family member’s active duty military service.
- Safe leave, otherwise known as sexual assault victim leave.
- Any reason set forth in Maine’s Family Medical Leave Requirements.
- For the death or serious health conditions of certain family members in the military who died or incurred a serious health condition while on active duty.
- For the donation of an organ of the employee for a human organ transplant.
The law defines “family member” as a biological, foster, step or adopted child; grandparent; grandchild; sibling; spouse; domestic partner; or an “individual with whom the covered individual has a significant personal bond that is or is like a family relationship, regardless of biological or legal relationship.”
The state Department of Labor will establish procedures and forms for filing claims for family and medical leave benefits and will specify what supporting documentation is necessary to support a claim for benefits, including any documentation required from a health care provider for proof of a serious health condition and documentation required by the administrator regarding a claim for safe leave or qualifying exigency leave.
The law defines “serious health condition” as “an illness, injury, impairment, pregnancy, recovery from childbirth or physical, mental or psychological condition that involves inpatient care in a hospital, hospice or residential medical care center or continuing treatment by a health care provider.” This is a much broader definition, particularly with respect to pregnancy, than how Maine currently defines “serious health condition” in the state’s family medical leave requirements.
Any medical or health information employers receive from employees seeking these benefits must be treated as confidential and may not be disclosed except with permission from the individual who provided it.
Leave Length
A worker may take up to 12 weeks of family leave and up to 12 weeks of medical leave per year, but may not take more than 12 weeks, in the aggregate, of family leave and medical leave in the same year.
Employees may take leave intermittently in increments of not less than eight hours, or if the employer and the employee agree, on a reduced leave schedule.
Employers must post a workplace notice of the benefits available under the program. Employers also must issue written notice to each employee within 30 days of the start of employment that includes an explanation of benefits, as well as information on employees’ rights and obligations.
The bill requires employees to provide reasonable notice of their intent to take leave. The penalty imposed on individuals who take paid leave based on false statements or misrepresentations is a one-year disqualification from the program and potentially that the administrator will seek repayment of the benefits received.
Employers should begin reviewing their leave policies to prepare to comply with the impending new law. Employers should monitor the state rulemaking process and contact counsel to ensure compliance with the forthcoming rules.
Steve Silver and Mindy Caterine are attorneys with Littler in Portland, Maine. © 2023 Littler. All rights reserved. Reprinted with permission via Lexology.
