From the Pros at the HR Support Center
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.
On January 1, 2021, the state minimum wage will increase to $13.50 per hour. The minimum base wage for tipped employees will increase to $5.55 per hour.
The rate of premium pay (applicable to many retail employees) for working on Sunday, Memorial Day, Juneteenth, Independence Day, and Labor Day, will be reduced to 1.2 times an employee’s regular rate of pay. Premium pay for working on New Year’s Day, Columbus Day, and Veterans Day, however, remains at 1.5 times the employee’s regular rate.
Paid Family and Medical Leave
Employees in Massachusetts may now begin to apply for and take Paid Family and Medical Leave (PFML) approved by the MA DFML starting January 1, 2021. The types of leave for which covered employees may apply must be related to their own serious health condition, birth, adoption, or foster care placement of a child, or because of a qualifying exigency arising out of the fact that a family member is on active duty or has been notified of an impending call to active duty in the Armed Forces. Effective July 1,2021, covered employees may also apply for leaves related to caring for a family member with a serious health condition. PFML includes partial wage replacement, job protection, and continuation of employment benefits. PFML is funded by a state tax, which began on October 1, 2019, and is administered by the Department of Family and Medical Leave. Employers are responsible for remitting the premiums but are not responsible for paying out PFML benefits directly to employees.
PFML applies to most employers and employees in Massachusetts; generally, only workers who are exempt from state unemployment insurance are exempt from PFML.
The state has a website with FAQs, action items, videos, and other resources for employers.
The state will determine an employee’s eligibility when they apply. It is not the responsibility of the employer to determine if someone is eligible. That said, when speaking with employees about their job-protection benefits, it may be helpful to know who is or not likely to qualify.
To be eligible for PFML, an employee must have:
- Earned $5,100 during the last 4 completed calendar quarters (from any combination of Massachusetts employers), and at least 30 times more than the amount they would be eligible to get each week from PFML; and
- Paid the full 0.75% contribution rate for both family and medical leave for at least 2 of their last 4 completed calendar quarters before claiming benefits.
Amount and Reasons for Leave
Eligible employees may take up to 12 weeks of family leave, up to 20 weeks of medical leave, or up to 26 weeks of some combination of family and medical leave.
Paid family leave may be taken to:
- Bond with a newborn child
- Bond with a child after adoption or foster care placement
- Manage family affairs when a family member is on active duty in the armed forces
- Care for a family member who has a serious health condition (starting July 1, 2021)
Paid medical leave may be taken for an employee’s own serious health condition.
PFML can run concurrently with other state and federal family and medical leaves, such as the federal Family and Medical Leave Act. PFML provides job protection and requires that you continue the employee’s health insurance benefits, if any, on the same terms as though they had continued to work during their leave.
The benefit amount will be equal to 80% of an employee’s weekly wage that is 50% or less of the state average weekly wage (SAWW), plus 50% of their weekly wages above 50% of the SAWW (if any). In 2021 benefits are capped at $850 per week. Employers are not responsible for determining how much an employee is entitled to when taking PFML—the state will determine how much an employee will receive based on their past earnings and the current SAWW.
Notice to Employees
If you haven’t already notified current employees about PFML, you should do so immediately. New employees must be notified within 30 days. The notice must be written in the employee’s primary language. Employers are also required to obtain a written acknowledgment from each employee that they received the notice.
The Department of Family and Medical Leave offers a template notice and acknowledgment. Alternatively, employers may create their own form.
Employers must display a poster about PFML in English. If five or more of your employees primarily speak a shared language other than English, you must also post a version in that language if it is available here.
For more information about PFML, search for PFML on the HR Support Center or visit the state’s website.