The Maine Department of Labor (MDOL) is reminding employers that contributions and quarterly reporting for the state’s paid family and medical leave program will begin Jan. 1, 2025. The MDOL has also issued a proposed rule to implement the program and updated guidance in the form of frequently asked questions.
Employers can opt to have a private plan to meet the requirements, provided the plan is approved by the state. Applications for using a private plan may be made after April 1, 2025.
The details
Coverage
A “covered employee” is an employee who earns wages in Maine. However, wages do not include wages earned from federal employment, federal work study financial aid, during incarceration, by certain volunteers as specified in the proposed rule, or by an employee subject to the Railroad Unemployment Insurance Act. Independent contractors may elect coverage, and if so would report wages earned and submit contributions in order to be a covered individual. Employees must meet certain wage-base requirements to be eligible for the paid leave.
Definition of Wages
Under the published guidance, wages include all forms of compensation for personal services, such as regular salary, tips, commissions, bonuses, and severance pay. It does not cover payments made to independent contractors.
For payroll and premium contribution purposes, wages are calculated similarly to how Maine Unemployment wages are determined but applied to a larger base of employees that are not traditionally subject to the Maine Unemployment contributions tax. Wages exclude amounts above the annual base limit set by the U.S. Social Security Administration.
Review the guidance (FAQ # 13) for more information on determining whether wages were earned in Maine.
Contributions
Beginning Jan. 1, 2025, employers with 15 or more employees will contribute 1 percent of wages and may deduct up to half of the contribution from the employees’ wages. Employers with fewer than 15 employees will contribute 0.5 percent of wages and may deduct the entire amount from the employees’ wages.
Under the proposed rule and guidance, for the purposes of determining contribution liability for the calendar year, the determination would be based on whether the entity employed 15 or more covered employees per the employer's Federal Employer Identification Number (FEIN) on their established payroll in 20 or more calendar workweeks in the 12-month period preceding Sept. 30 of each year.
This count would include the total number of individuals on establishment payrolls employed full or part time who received pay for any part of the pay period. Temporary and intermittent employees would be included, as are any workers who are on paid sick leave, on paid holiday, or who work during only part of the specified pay period.
In addition, under the proposed rule and guidance, on Oct;1, 2024, and Oct. 1 of each year thereafter, the employer would be required to calculate its size for the purpose of determining contribution liability for calendar year 2025 and each calendar year thereafter. This employer count would be reported upon first registering with the Maine Paid Leave Portal, and during Quarter 3 wage reporting annually thereafter.
Reporting
Beginning Jan. 1, 2025, for each employee, employers must remit quarterly wage reports and contributions via the Maine Paid Leave Portal. All employers will be required to register via this portal to determine their contribution liability and to designate a third-party payroll or employee leasing company if they wish. All liable and active employers must create an account in the portal to electronically file quarterly wage reports and make contribution payments. Wage reports and contributions are due on or before the last day of the month following the end of each quarter.
Payments and reports are considered timely if received electronically by the due date. If the due date falls on a Saturday, Sunday, or legal holiday, the due date is extended to the next business day. Employers may have their payments and reports submitted by an employee leasing company or an authorized third-party administrator.
Employee notice
Absent extenuating circumstances, an employee must give reasonable notice to their supervisor of their intent to use leave under the program. Use of such leave must be scheduled to prevent undue hardship on the employer as reasonably determined by the employer.
Employer notice
Employers must post in a conspicuous place on each of their premises a workplace notice provided or approved by the (MDOL) to notify employees of their rights under the paid family and medical leave program.
The MDOL will create the workplace notice in English, Spanish, French, Somali and Portuguese and any other language that is the primary language of at least 2,000 residents of the state. The employer must post the workplace notice in English and each language other than English that is the primary language of three or more employees of that workplace, if such notice is available from the MDOL.
An employer must also furnish a written notice, provided or approved by the MDOL, to each employee no more than 30 days from their date of hire. The notice must be in the employee's primary language.
Wage Statements
The paid family and medical leave law is silent regarding pay statement requirements. However, Maine does require itemized deductions on their pay statements.
Next steps
- ADP TotalSource will begin processing employee and employer contributions for all clients with Maine employees on Jan. 1, 2025, at the Large Employer rate.
- Clients who qualify as small employers and wish to reduce contributions must submit a State Family Medical Leave Attestation Form. Download the form from the TotalSource Forms Library within the payroll system.
- Email the completed State Family Medical Leave Attestation to HROTaxSolutions@ADP.COM with the Company Name and Company Code(s) of the accounts to reclassify.
- Review leave policies and update them if necessary.
- Watch for the sample poster and notice that must be provided to employees.
- Once published, display the poster in the workplace and provide the sample notice to new hires.
- Train supervisors on how to handle leave requests.
- Begin providing leave for the covered reasons on May 1, 2026.