Maine PFML: Your top 10 questions answered

November 25, 2024

Helping employers prepare for the new state paid leave program

As Maine's Paid Family and Medical Leave (PFML) program goes into effect, employers have many questions. To help you navigate this new landscape, we took your top ten most asked questions straight to our experts to get you the answers you need.

1. Who’s covered by Maine PFML?

A "covered employee" is anyone earning wages in Maine. Employees cannot opt out of coverage. Excluded are self-employed individuals*, federal government employees, students in Federal Work-Study Programs, volunteers and incarcerated persons. To be eligible for benefits, a covered employee must earn wages at least six times the state's average weekly wage during their base year.

2. Who’s considered a Maine worker?

The PFML program uses the same locality test as Maine unemployment law. A worker earning Maine wages is determined through a four-criteria sequential test:

1. Place where work is performed: If all work is done in Maine or work outside the state is temporary or minor, Maine law applies.

2. Base of operations: If some work is done in Maine and other states but the base of operations is in Maine, Maine law applies.

3. Place from which service is directed or controlled: If some work is done in Maine and the work is directed or controlled from a place of general authority in Maine, Maine law applies.

4. Place of residence: If none of the above apply, some work is done in Maine, and the employee resides in Maine, Maine law applies.

3. Which employers are subject to Maine PFML?

All employers with at least one employee in Maine are subject to Maine PFML, excluding the federal government and tribes. Employers cannot opt out but can substitute an equivalent plan by applying for an exemption starting April 1, 2025. The plan can be purchased through a private insurance carrier, or the employer can develop a self-insured plan approved by the department.

4. What’s the waiting period for leaves?

There is a seven-day waiting period for medical leaves but not for family-related leaves.

5. Are there employee notification requirements?

Yes, employers must post a workplace notice in a conspicuous place and provide new employees with written notice within 30 days of hiring that details:

An explanation of the availability of family leave benefits and medical leave benefits provided under this subchapter, including rights to reinstatement of employment and continuation of health insurance
The employee's contribution amount and obligations under this subchapter
The name and mailing address of the employer
The identification number assigned to the employer by the administrator
Instructions on how to file a claim for family leave benefits or medical leave benefits
The mailing address, email address and telephone number of the administrator
Any other information deemed necessary by the administrator

The Maine Department of Labor has published a downloadable PFML poster for employers to satisfy the above requirements as well as a document, "What Employers Need to Know," outlining employer obligations.

6. Does this leave run concurrently with other leave?

Yes, Maine PFML runs concurrently with other leaves when applicable. However, it does not have the same eligibility requirements as the federal FMLA, so they may not always run concurrently, and an employee may be able to “stack” the leaves depending on the circumstance. Employers should review their leave policies to ensure requirements for taking PFML concurrently are addressed.

7. What is the contribution amount, and can employers cover 100% of the contribution rate?

For 2025-2027, the combined contribution rate is 1% of wages up to the Social Security Maximum Taxable Wage Base. Employers and employees each pay 0.5%. Employers with fewer than 15 employees in Maine do not have to contribute the employer portion. Employers can choose to pay more than 50% of the contribution rate (up to 100%) but cannot charge employees more than 50% of the state rate.

8. Do both the employer and employee need to agree to intermittent leave?

Maine PFML does not require employer approval for intermittent bonding leave. Employees must provide sufficient notice: 30 days in advance if leave is foreseeable or as soon as practicable if not. Maine has an undue hardship provision if sufficient notice is not provided. Employers must still allow leave on a reasonable basis but may be able to work with employees to schedule.

9. How are STD benefits impacted once Maine PFML is in place?

In-force STD plans will be reviewed on a case-by-case basis. Unum offers standard STD policies that include offset language where the state benefit is the primary payer, reducing the STD benefit based on the statutory benefit amount.

10. What are the benefits of going with a private plan?

Private carriers offer extensive experience in administering absence/leave portfolios. Unum provides an integrated client experience, allowing employees to file all benefits with one entity. Employers receive integrated reporting and complete information on employee absences. Additionally, employers approved for a private plan before June 30, 2025, do not have to pay contributions to the state after the first quarter of 2025.

Conclusion

As the Maine PFML program goes into effect, it's essential for employers to be well-informed about their obligations and options. Opting out of the state plan for a private plan is an option, and our experts are ready to assist you every step of the way.

At Unum, we understand that staying compliant with new laws can be complex, and we're here to help. We'll provide you with the latest updates and insights as they become available, ensuring you stay ahead of the curve. Together, we can ensure your business is prepared for the changes ahead.

*Self-employed individuals include independent contractors, sole proprietors and members of an LLC who report P&L losses.