On January 1, 2021, Maine’s minimum wage will increase to $12.15 per hour. The tipped employee direct wage will increase to $6.08 per hour.
Earned Paid Leave
Starting on January 1, 2021, employers that have 11 or more employees working in Maine must provide them with Earned Paid Leave. Employees are entitled to use Earned Paid Leave for any purpose. Below are the highlights of the law—the state has also created a useful FAQ for employers.
All employees—including part-time, temporary, and per diem—are eligible for Earned Paid Leave if they work for an employer that has 11 or more employees in Maine, except for certain “seasonal employees” and employees who are covered by a collective bargaining agreement as of January 1, 2021. See the Maine Earned Paid Leave and Public Health Emergency Leave laws page in the HR Support Center for more information about the exceptions.
Accrual and Use
Employees must accrue at least one hour of Earned Paid Leave for every 40 hours worked, beginning on January 1, 2021, or their first day of employment (whichever is later). Exempt employees will be presumed to work 40 hours per week, unless there is a record of their actual hours worked. Employers can cap accrual and annual use at 40 hours. Up to 40 hours of unused leave will carry over into a new benefit year. Employers can frontload leave rather than have it accrue by the hour, but employees must be provided with at least as many hours as they would earn via hourly accrual; if they end up working more hours than anticipated, their leave balance should be adjusted.
Employers can enforce a waiting period of up to 120 days before employees may use their Earned Paid Leave. However, time employed in 2020 counts toward the waiting period. For example, if an employee was hired in July of 2020, then they can use their paid leave as it is accrued beginning on January 1, 2021. In contrast, an employee who was hired on October 1, 2020, would not be entitled to use their accrued leave until January 29, 2021.
Earned Paid Leave can be taken in increments as small as one hour or smaller if allowed by the employer.
Notice and Payout
Employers can have a policy requiring employees to provide up to four weeks’ notice to take foreseeable leave, but that policy must be in writing to be enforced. For unforeseeable leave, employers can require employees to provide notice that’s reasonable under the circumstances.
Unused Earned Paid Leave does not have to be paid out at termination if the employer states that it will not be paid out in a written policy. If an employer does not have a written policy, then it must be paid out if it has a practice of paying out unused vacation time at termination. We encourage employers to have a written policy and be specific about what will happen with unused leave.
If unused leave is not paid out and the employee is rehired within one year, their previous balance of unused leave must be reinstated.
Employers must post a notice about employees’ Earned Paid Leave rights in the workplace and distribute it electronically to employees who are working from home (if no one is going to the workplace, just electronic notice is fine). This notice, provided by the state, is acceptable.
Employers who already offer paid time off benefits that are at least as generous and non-restrictive as what is required by the Earned Paid Leave law do not need to offer additional paid leave (but should be very sure that the benefit they offer meets the requirements). Employers may also choose to have a separate sick, vacation, or PTO policy in addition to Earned Paid Leave if they want to have different rules for use.