The Maine Department of Labor on Wednesday finalized rules for the state’s new paid family and medical leave program.
Now starting Jan. 1, Maine will implement a 1 percent payroll tax, split in half between employers and workers.
“Really almost every worker in Maine will start noticing payroll withholdings from their paychecks,” said Luke Monahan, director of the paid family and medical leave program at the Maine Department of Labor. “And every employer in the state … has responsibilities under this new law to contribute to the program.”
Employers with just one working employee in Maine must make contributions as well.
“Even if they’re working for a company in California — they’re performing the work in Maine, because they’re working 100 percent remotely in Maine — so in that scenario they’re subject to this law and they have the ability for benefits in 2026 as well,” Monahan said.
Employers with fewer than 15 workers are not required to contribute to the program. Employees at small organizations, however, will still contribute 0.5 percent of their wages and are eligible to receive benefits.
The contributions made over the next 15 months will help build a reserve fund for family and medical leave benefits to eventually be paid out, Monahan said.
Under the program, Maine workers can take up to 12 weeks off for the birth of a new child, or to care for a sick family member or themselves. They’ll be paid at up to 90 percent of their regular wages.
Those benefits begin in May 2026.
Maine is the 13th state to establish a paid family and medical leave program. The state’s Department of Labor received more than 1,600 comments about the program and spent the past year writing the rules.
On Wednesday, the Maine State Chamber of Commerce said it was concerned that the timeline for employers and employees to begin contributing and reporting wages was too tight.
“Maine’s PFML program is arguably the most significant regulatory initiative in decades, is extremely complex, and the Maine State Chamber and employers across the state are concerned that the tight three-to-four week timeline for implementation will impact the program rollout’s success, and that employers that will opt in to a substantially equivalent private plan are required to contribute to a program they will never use,” Patrick Woodcock, the chamber’s CEO, said Wednesday in a statement.
Monahan encouraged Maine workers and employers to sign up for updates about the new paid leave program from the Maine Department of Labor.
The department held a webinar earlier this week for employers to learn about the new portal they will use to report wages and make contributions. It will host another webinar next week for third-party administrators to learn about the portal.
Employers and employees can visit the Maine Department of Labor’s website for more details about the program, the online contributions portal and other information.
This article appears through a media partnership with Maine Public.
