Mills Administration Bungles Rollout of its Own Paid Leave Program for State Employees

The Mills administration managed to botch the rollout of their own new Paid Family and Medical Leave program, mistakenly listing the one percent payroll tax deduction for the program as being fully paid by the employee on Maine state employees’ paychecks this week.

Contributions to the so-called Paid Family and Medical Leave program came into effect on Jan. 1, 2025, with most private employers and employees splitting the new one percent payroll tax to the state depending on the size of the employer.

[RELATED: Maine Democrats Celebrate Start of New 1% Payroll Tax on Maine Workers, Businesses…]

Many employers of unionized employees, including the state government, are paying the full one percent payroll tax, as collective bargaining agreements preclude their employees from being required to pay an additional tax on their paycheck. Which means government employees aren’t feeling the pinch of Maine’s largest tax increase on workers in several decades.

Maine workers will not be able to benefit from the program until the spring of 2026, when they will be able to take up to twelve weeks of paid leave for an eligible reason, such as caring for a sick family member or newborn baby, or for those who are dealing with a serious and extended health condition. The law has also been criticized for allowing paid leave to be taken for more ambiguous reasons, like to spend time as the caretaker for a friend or roommate suffering an emotional ordeal.

In an email to state employees sent Tuesday morning, just a day after the state launched their new online “Maine Paid Leave Contributions Portal,” the Department of Administrative and Financial Services (DAFS) Commissioner Kirsten Figueroa announced that they had mistakenly listed the one percent reduction as fully paid by state employees on their upcoming paycheck.

[RELATED: Maine’s New Paid Leave Rules: Here’s What Businesses and Workers Should Expect…]

“Dear State Employee: I’m reaching out with some important information concerning incorrect information on the State of Maine Pay Advices (paychecks) dated January 8…” Figueroa wrote in the email.

“The Paid Family Leave Premium Contributions (PD FMLY LV STATE) of 1% were erroneously listed as part of ‘Total Employee Deductions,’ when they should have been displayed under the “Total State Paid Deductions,” Figueroa continued. “Because of this, the pay advice displays an incorrect amount under ‘Net Pay’ and ‘Total Employee Deductions.'”

However, the error appears to have only affected how the paycheck was displayed, as according to Figueroa the Paid Family and Medical Leave deduction was “not actually deducted from the employee,” but rather was charged to the state.

[RELATED: Republican Lawmaker Seeks to Repeal Impending Payroll Tax for New Paid Leave Program…]

“This issue has been corrected for future paychecks,” Figueroa wrote. “A correct version of the January 8 Pay Advice information will be reissued at a later date.”

“Thank you for your patience as we make the necessary corrections within our system,” she added.

It is unclear if the Mills administration will be extending the same level of patience they expect from state employees with their bungled launch of the paid leave program to the state’s private businesses, all of whom are also now forced to use the new online portal system with which even the state government appears to be struggling.