New Vacation Time Pay Law

Beginning in 2023, Maine law will require employers to pay employees accrued but unused vacation time when they separate from employment. This law applies to private businesses with more than 10 employees.

How This Impacts Your Business and Employee Handbook

• The new vacation payout law takes effect January 1, 2023, so employers should update carry-over policies now to avoid surprise payout requirements in 2023.
• Employers should review all leave policies to also ensure compliance with Maine’s earned paid leave (“EPL”) law, which has rules about carry-over, as well as accrual of leave and notice to take leave, among other requirements.

Other New Employment Laws:

• New protected classes have been added to the Maine Human Rights Act, including but not limited to traits associated with race, such as hair texture and style.
• New prohibitions on mandatory arbitration and non-disclosure agreements in settlements of discrimination claims.
• Maine’s recent restrictions on non-competition agreements merit updates to employment contracts and policies.
• Remote or hybrid work policies are recommended for employers who have employees working from home.

Our team at Murray Plumb & Murray can ensure your employee handbook and contracts fully comply with all new and existing Maine and Federal law. We can also assist in navigating options as you seek to achieve your goals and stay compliant with the changing laws.

Updating employee handbooks regularly (at least yearly) is an important step to take in protecting your company and ensuring legal compliance. Our employment law attorneys are here to help and can be reached at employmentlaw@mpmlaw.com.