Like many throughout Maine, you probably have questions about the new Paid Family and Medical Leave (PFML) program and how this will affect your business. While information and guidance will continue to evolve, this blog post highlights some of the important details we know today, that Maine employers should be aware of.
- What is the Maine Paid Family and Medical Leave Program (ME PFML)?
On July 11, 2023, Governor Mills signed a budget that includes creating a paid family and medical leave program for the state. Beginning in 2026, eligible workers will have 12 weeks of paid time off available for family or medical reasons including illness, to care for a relative, or for the birth of a child. Maine will be the 13th state to establish a paid leave program.
When does ME’s PFML start?
The key dates that employers should be aware of include:-
October 2023: The budget goes into effect
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January 2024: Maine DOL begins the rulemaking process
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January 1, 2025: Contributions to the Paid Family Medical Leave fund begin
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January 1, 2025: Initial rules necessary for the implementation of the Paid Family and Medical Leave program must be adopted by the Maine DOL
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May 1, 2026: Paid Family and Medical Leave benefits scheduled to begin
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- Who is eligible for ME’s PFML?
Benefits will be available for full-time, part-time, temporary, and seasonal workers in the public and private sectors. Self-employed workers will be able to opt-in to the program. More specific eligibility requirements will be determined during the rulemaking process.
- How is the program funded?
Maine’s PFML program is funded through a maximum 1% payroll tax, split between the employee and employer. More specific details, including employer and employee split requirements, will be determined during the rulemaking process.
- Is there a wage cap for the payroll tax?
The wage cap for contributions is based on the social security wage base.
- Will all businesses be required to participate in the program?
Employers can opt out of the program if they offer a comparable, private plan. However, the cost to their employees can not be greater than the payroll tax under the state plan. Businesses with fewer than 15 employees are exempt from paying into the state plan; however, employees of small businesses are still required to pay into the program and can claim benefits.
- Where can Maine employers find additional information?
More detailed information can be found on the Maine Department of Labor website here.
- If you are an employer in Maine, what should you do now?
We’ve worked with customers in other states as their state-mandated PFML programs have been developed and implemented. Until we get more information from the Maine Department of Labor, employers should consider how a PFML program will impact other employee benefits including PTO, STD, earned time, etc. The Acadia Benefits team is happy to get on a call to discuss what we’ve deployed in other states and lessons learned.
We will continue to provide information as it becomes available and communicate what you need to know as we learn more. If you have any questions, our team is always available to help!
Robert Kennedy
207.822.4376
RKennedy@AcadiaBenefits.com
This information is general and is provided for educational purposes only. It reflects our understanding of the available guidance as of the date shown and is subject to change. It is not intended to provide legal advice. You should not act on this information without consulting knowledgeable advisors.
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