By Ellen Masalsky and Maria Fox

Maine recently joined a small, but growing list of states offering paid family and medical leave programs.[1]  Maine adopted LD 1964 (enacted as 26 M.R.S. § 850-A et seq.), which provides eligible employees in the private and public sector up to 12 weeks per year of paid family and medical leave (“PFML”). Eligible employees in Maine can begin taking leave under the PFML program on May 1, 2026.[2]

Maine’s PFML program will provide employees a portion of their income while they are on leave. The program provides employees with a weekly benefit amount equal to 90% of the employee’s wages for income earned that is equal to or less than 50% of Maine’s average weekly wage (which is currently $1,103.71 and is adjusted annually).[3] If the employee makes more than 50% of the state average weekly wage, then for the portion of their earnings over this amount they will be compensated at a rate of 66% of their weekly earnings up to the maximum weekly benefit. The maximum weekly benefit is capped at 100% of the state average weekly wage. For example, under Maine’s current average weekly wage, an employee earning 50% of the annual average wage (or $552 per week), would receive 90% of $552, which is $497 per week. An employee who earns $50,000 per year or $962 per week (which is more than 50% of the current average weekly wage in Maine), would receive 66% of $962, which is $635 per week. An employee who earns $100,000 annually or $1,923 per week, would receive the maximum weekly benefit of $1,103.71 because 66% of their weekly salary is $1,269, which is higher than the maximum weekly benefit. PFML benefits are not subject to state income tax, though they may be taxable under federal law.

Which employers are covered?

• All public employers (except the federal government)
• Private full-time and part-time employers
• Self-employed individuals and tribal governments who opt-in
• Employers of all sizes are eligible to participate, but only employers with 15 or more employees are obligated to contribute funds to the program (see below for more details).
• Employers with existing family and medical leave benefits may apply to opt-out of the state program if their benefits are equivalent to or better than the state PFML program.

Who qualifies as an eligible employee?

• All public employees (except those employed by the federal government)
• Private full-time and part-time employees
• Self-employed individuals: self-employed individuals may elect to participate in the program (though they are not required to participate) and must remit their portion of the payroll tax directly to the Maine Department of Labor.
• Earnings Requirement: Must have earned at least six times the state average weekly wage (currently $6,622.26) in the year immediately preceding the first day of an individual’s benefit year are covered by the law. The employee need not have been working for their current employer when they earned this income. Employees can take paid leave immediately after starting new employment.[4]

What can employees use PFML for?

LD 1964 provides that employees may use PFML for purposes including:

• Caring for the employee’s own serious health condition.
• Caring for a family member with a serious health condition.
• For the birth of the employee’s child or the employee’s domestic partner’s child.
• Placement of a child with the employee or the employee’s domestic partner for adoption.
• Bonding with the employee’s child within the first 12 months after the child’s birth or placement for adoption or foster care.
• For the donation of an organ of the employee for a human organ transplant.
• For the death or serious health condition of certain family members in the military who died or incurred a serious health condition while on active duty.
• To attend a “qualifying exigency” related to a family member’s active-duty military service.
• For safe leave, which is leave taken because employee or their family member was a victim of violence, assault, sexual assault, etc. Such leave may be taken not only for medical reasons but also to seek an order of protection, make the employee’s or their family member’s home secure or seek new housing, and obtain legal assistance.

An employee’s leave need not be taken consecutively. Employees may take leave intermittently so long as the increments are not less than eight (8) hours or, at the discretion of the employer, the employee and employer can agree on a reduced leave schedule. This means that an employee can stagger their leave in a manner that meets their needs. If an employee takes intermittent leave or reduced leave schedule, “the weekly benefit amount must be prorated as determined by the department.”

Who qualifies as a family member?

LD 1964 broadly 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.”

What qualifies as a serious health condition?

A “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 definition is particularly important for pregnant individuals—unlike Maine’s current FMLA regulations, LD 1964’s definition of “serious health condition” specifically includes pregnancy and recovery from childbirth.

How much notice must an employee provide prior to taking PFML?

Employees must give “reasonable notice” to their supervisor absence an emergency, illness or other sudden necessity. Use of the leave must be scheduled “to prevent undue hardship on the employer as reasonably determined by the employer.” If the employer fails to post required notice in the workplace and provide new hires requisite information about the PFML, the notice requirement for the employee is waived.

Are PFML benefits offset by other income?

PFML benefits are reduced by wages or wage replacement under a government law or program such as unemployment or workers compensation benefits (with some exceptions), or a state or federal temporary or permanent disability benefits law. PFML benefits also may be reduced by a permanent disability policy or program of an employer.  

Are employees’ jobs protected who take PFML?

The new law provides job protections for employees who take PFML so long as they have been employed with their current employer for at least 120 days prior to taking leave. Employers are required to restore the employee to the same or equivalent position with the same or equivalent benefits, pay, and other conditions of employment upon their return from leave. However, employers are prohibited from retaliating against employees for taking leave under Maine’s PFML program regardless of the length of their employment before taking leave.

Does PFML impact other benefits (e.g. vacation time and sick time)?[5]

The new law prohibits employers from altering an employee’s “right to accrue vacation time, sick time, bonuses, seniority, length of service credit or other employee benefits, plans or programs.” If the employer provides health insurance they are required to “continue to provide for and contribute to the employee’s employment-related health insurance benefits, if any, at the level and under the conditions coverage would have been provided if the employee had continued working continuously for the duration of leave.”

PFML leave runs concurrently with federal family and medical (“FMLA”) leave and the current Maine Family and Medical Leave Requirement, 26 M.R.S. § 843 et seq. This means that employees cannot take state or federal FMLA leave on top of PFML leave – employees may only take a total of 12 weeks of family and medical leave per year (whether under Maine’s program or the federal program). It is important to note that permitted uses of Maine’s PFML are broader than those allowed for current state or federal FMLA leave, which means that employees may qualify for leave under Maine’s PFML program even if they are not otherwise covered by state or federal FMLA leave.

How do employers and employees contribute to the program?

Starting on January 1, 2025 (one year before PFML benefits become available to employees) employers and employees will begin paying a 1% payroll tax to fund the program. This 1% payroll tax will be split equally between the employee and the employer (which the employer must collect and remit to the state). Employers with fewer than 15 employees are exempt from contributing to the program, but they must still remit the employee’s portion of the payroll tax to the state.

Employers with 15 or more employees are required to participate in and contribute to the PFML program unless they offer equivalent or greater paid medical and family leave benefits. In this case, the employer can apply for a waiver to opt out of participation in the state program. Employers cannot require their employees to contribute more than the payroll tax employees must pay under the state plan.

How will compliance with the PFML program be enforced?

The Maine Department of Labor (the “Department”) is charged with administering the PFML program and promulgating regulations. The Department will take enforcement action against employers who fail to comply with the requirements of the program.

If an employer fails to make the payroll tax contributions required under the PFML program, they will be assessed 1.0% of its total annual payroll for each year of noncompliance in addition to any amounts previously owed. The Employer must also pay to the Department the total amount of family leave benefits and medical leave benefits paid to covered individuals for whom the employer failed to make premium contributions.

Employees who take leave based on false statements or misrepresentations will be disqualified from participation in the PFML program for one year and the Department may seek repayment of PFML benefits that employee received.

 

If you’re an employer, you should contact your legal counsel for legal advice on these recent changes or to review or develop paid leave policies. Our employment attorneys are here to help.

 

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[1] As of the date of this article, 13 states, and Washington D.C., have enacted mandatory paid family and medical leave programs. See https://bipartisanpolicy.org/explainer/state-paid-family-leave-laws-across-the-u-s/.

[2] The Maine Department of Labor provided a timeline for implementing the PFML, which says that May 1, 2026 is the date PFML benefits are scheduled to begin. See https://www.maine.gov/labor/pfml/.

[3] https://www.maine.gov/wcb/Departments/claims/saww/2023_State_Average_Weekly_Wage_Rates.pdf

[4] It is important to note that employees who have not been employed for 120 days with their current employer lack important job protections.

[5] This does not apply to self-employed individuals.