The Maine Department of Labor (MDOL) released two guides Monday for employers looking to opt out of the state’s new Paid Family and Medical Leave Program in favor of using their own private plan, though concerns about an overlap in payments and a challenge to the constitutionality of the new benefit persist.
MDOL’s guides come just a couple weeks after the Maine State Chamber of Commerce and Bath Iron Works sued the agency, alleging that the rules it adopted late last year to govern the program are inconsistent with the law establishing the program.
While the law guarantees that businesses can choose to substitute alternative paid leave plans, the rules adopted by the MDOL require employers to send in at least several months worth of non-refundable payments before they can even apply for a substitution.
Bath Iron Works also argued that the rules allegedly violate their Constitutional rights.
Contributions to the state’s paid leave program were required to begin on January 1 of this year, but businesses are not allowed to apply for a private plan substitution until April 1.
[RELATED: Maine’s New Paid Leave Rules — Here’s What Businesses and Workers Should Expect]
The Paid Family and Medical Leave program was the brainchild of Senate President Mattie Daughtry (D-Cumberland) and will likely have significant implications for businesses and workers statewide.
Although Sen. Daughtry’s bill did not pass as originally introduced, Gov. Janet Mills (D) later signed a budget into law that included, among other things, legislation establishing the program with a starting appropriation of $25 million for the MDOL to administer the program.
Employers and employees began contributing a new one-percent payroll tax to the state at the start of the year, sixteen months ahead of when benefits are scheduled to become available.
Beginning in the spring of 2026, Maine workers will be eligible to take up to twelve weeks of paid leave to care for a sick family member, as well as to bond with a newborn baby or newly adopted child. Also eligible for leave are those who are experiencing a serious health condition and are rendered unable to work for an extended period, and anyone serving as a caregiver for someone who meets the other conditions.
Click Here for More Information on the Paid Family and Medical Leave Program
The guides released Monday by the MDOL do not directly address this controversy either way, avoiding any mention of the April 1 date outlined in the agency’s rules.
They also do not address how the agency’s rules do not allow businesses and employees to receive a refund for payments made during the gap period prior to having an alternative private plan approved.
What the guides do outline are what employers must do if they want to opt out of the state program to begin or continue using a private paid leave alternative.
[RELATED: Bath Iron Works, Maine Chamber Sue State Over Paid Leave Rules]
One guide focuses on the substitution of fully-insured plans, while the other explains how employers may substitute a self-insured plan.
Fully-insured plans are described by the MDOL as giving employees the “rights, protections, and benefits substantially equivalent to those provided under the State Plan.”
Self-insured plans, on the other hand, are where an employer commits to providing these same things to employees independently or through a third-party administrator.
The guides also explain that only certain fully-insured plans will be certified as substitutes for the state-run program.
Before applying for a substitute, the guides indicate that employers seeking to use a fully-insured plan first must purchase qualifying coverage.
Employers looking to use either type of private plan must use the Maine Paid Leave Contributions Portal and click the “Request Substitution of a Private Plan” hyperlink.
The website will then prompt employers to input their businesses’ identifying information and select whether they are seeking to substitute a fully-insured or self-insured plan.
For employers going the fully-insured route, they will be prompted to input plan details and upload proof of purchase
Employers opting to substitute a self-insured plan will be asked to provide the relevant details and documentation.
Regardless which type of plan an employer is seeking to substitute, a $250 application fee must be paid to the state before pressing submit.
The guides do not provide an estimated time frame in which employers can expect the state to decide whether or not to except their applications.
If the state denies an employer’s application, the decision may be appealed within fifteen days.
Both guides emphasize that employers must continue to pay into the state paid leave program while their applications are pending.
More detailed information on the application process can be found in the guides released Monday by the MDOL and available at the links below:
Twenty Five Million to administer the “ State Program “ …..Two Hundred Fifty dollars “ application fee “ ….another One Percent Tax on employers and workers ….fees fees fees taxes taxes taxes ….more taxes …more fees
Thank You Senator Daughtry for another tax and spend scheme to comfort all YOUR socialist welfare state fellow democrats . It certainly has elevated YOU to a much better seat in the Augusta power structure hasn’t it !
Maine needs new leadership . It’s time to elect a Republican governor and a Republican legislature. These IRRESPONSIBLE democrats are driving Maine taxpayers over a fiscal cliff . Maine voters need to W.T.F. Up !
VOTE Republican and keep more money in your wallet and purse a!
The company my husband works for already has these benefits as do many other companies. Why should they have to pay twice or their employees pay out of their paychecks?
Is that a photo of two losers or what?
When you vote the clowns into the statehouse, the statehouse becomes a circus.
“We the people are the rightful masters of congress and the courts not to overthrow the constitution but to overthrow the men who would pervert the constitution.” Abraham Lincoln