Compliance Watch:

What are my rights as a salaried employee in Maine?

A salaried employee in Maine refers to any worker in the state who receives predetermined compensation every payday. Employees in salaried employment receive a fixed amount of compensation for their work regardless of the number of hours worked in a pay period or the quality and quantity of their work. Employees in the state typically receive their salaries through direct deposits and employers are prohibited from charging any fees to facilitate the payment of salaries. 

Maine salaried employees laws require employers to pay salaried employees regularly in intervals of 16 days or less regardless of their presence in the workplace on the designated payday. If the designated payday falls on a day when the business is closed, employees should be paid on the following business day. Additionally, an employee’s salary should include payment for all work completed within 8 days of the payday. 

Salaried employment in the state falls under two categories based on the applicability of minimum wage and overtime laws to the employees in each category. The first category of salaried employees is exempt employees, who are not subject to minimum wage or overtime laws. These employees are not entitled to overtime pay and their minimum salary is determined by the Federal Labor Standards Act (FLSA). The second category comprises non-exempt employees, who are subject to state minimum wage and labor laws. These employees earn overtime pay for all time worked in excess of 40 hours in a workweek.

In Maine, salaried employees have various rights and protections provided by state and federal laws. These include:

• Minimum Wage: Non-exempt salaried employees in the state are entitled to compensation of at least the minimum wage of $14.15 per hour. In comparison, exempt employees in the state are entitled to a minimum salary of $816.35 per week or $42,450.20 per year. 
• Overtime Pay: Eligible salaried employees in the state are entitled to overtime pay at a rate of 1.5 times their regular rate for each hour worked over 40 hours in a workweek.
• Rest Breaks: Salaried employees in Maine are entitled to a rest break of at least thirty consecutive minutes for every six hours of work. The break can be unpaid for non-exempt employees but is considered part of compensable time for exempt employees. 
• Anti-Discrimination Laws: The Maine Human Rights Act prohibits workplace discrimination based on race, color, sex, sexual orientation, age, physical or mental disability, genetic predisposition, religion, ancestry, or national origin. The act protects employees in the state from discrimination in recruitment, promotion, compensation, transfer, and tenure.
• Family and Medical Leave: Exempt employees in Maine are entitled to up to 12 weeks of job-protected leave for certain family and medical reasons under the Family and Medical Leave Act (FMLA).
• Time Tracking and Record Keeping: Non-exempt employees in Maine have the right to have their work hours recorded accurately.

Yes. Compensation on a salary basis is part of the criteria for exempt status but it does not preclude all salaried employees from overtime eligibility.

Non-exempt salaried employees in Maine are eligible for overtime pay for all time worked over 40 hours in a workweek. They accrue overtime pay at a rate of 1.5 times their regular rate as per Maine overtime laws. 

State employees can opt for compensatory time instead of overtime pay. Eligible employees accrue comp time in the same ratio as overtime pay. However, private employers are prohibited from offering comp time in lieu of overtime pay.

Yes, Maine labor laws allow employers to make the following deductions from an employee’s salary:

• Mandatory wage assignments, including child support, alimony, debts, and taxes. 
• Voluntary wage assignments such as debt repayments require the authorization of an employee’s spouse. 
• Recovery of overcompensation.

Title 9-A of the Maine Revised Statutes limits the percentage of an employee’s salary that can be deducted to 25% of disposable earnings. Please note that disposable earnings are an employee’s earnings after the deductions that are required by law.

Yes. Salaried employees in Maine have the right to take breaks of at most thirty consecutive minutes for every six hours of work. The break can be unpaid for non-exempt employees but is considered part of compensable time for exempt employees. 

In addition to breaks, the state requires employers with 11 or more employees and a business that operates for at least 120 days in a calendar year to offer paid time off (PTO) to employees. The employees earn one hour of PTO for every 40 hours worked for up to 40 days in a year. 

Employees may use their earned PTO as they wish but they are required to give their employers reasonable notice before taking time off and schedule their leave efficiently to avoid causing undue hardship to their employer. The only exceptions to this rule are emergencies such as illness, which employees cannot foresee or plan. 

In addition to the 40-day paid leave, exempt employees in the state are entitled to family and paid leave of up to 12 weeks to receive medical care and recover from illness or take care of immediate family members who are unwell. Exempt employees with injured veterans in their immediate family in need of care can take up to 26 weeks of unpaid leave without losing their jobs as per the FMLA.

Maine state laws do not enforce specific flexible work arrangements for employees. However, the state encourages employers and employees to enter private agreements establishing alternative work schedules that deviate from the standard 40-week schedule. In fact, in June 2023, the Maine State Legislature passed a law prohibiting employers from retaliating against employees for requesting flexible work arrangements.

Maine state laws establish three-pronged criteria to define exempt status. As per the criteria, an exempt employee in the state refers to an employee who:

• Is paid on a salary basis.
• Earns more than $816.35 per week or $42,450.20 per year.
• Performs job duties that meet the criteria for administrative, professional, and executive employee exemptions.

Exempt employee status refers to employee exemptions from certain labor laws, including state overtime and minimum wage laws. Exempt employee status has the following implications for employees:

• Basis of Compensation: Exempt employees are compensated on a salary basis. They receive a fixed salary every 16 days, which could make budgeting and financial planning easier. 
• Overtime Eligibility: Exempt employees are not eligible for overtime pay. Therefore, they do not receive any additional compensation for exceeding 40 hours of work in a workweek. 
• Flexibility: Exempt employees can request flexible work arrangements. Therefore, they may have greater flexibility in their work hours, granting them control over their schedules. Flexibility can be beneficial for their work-life balance.

Exempt status has the following implications for employers:

• Simplified Payroll: Exempt employees simplify payroll processes since employers do not need to track hours worked or calculate different rates of compensation for regular and overtime hours. 
• Attracting and Retaining Talent: Exempt status is coveted in the labor market due to its high salary threshold. Employers can use it as an incentive to attract and retain top talent in their organizations.
• Reduced Labor Costs: Since exempt employees are not eligible for overtime pay, they reduce their employers’ payroll costs, particularly in industries or roles with high variability in working hours.

To determine whether you qualify as exempt, you can conduct the following tests: 

1. Salary Basis Test: The FLSA requires all exempt employees to be compensated on a salary basis. The employees receive a fixed salary at the end of every pay period regardless of the quality or quantity of their work and the number of hours worked in the pay period.
2. Salary Level Test: The FLSA sets the minimum salary threshold for exempt employees as $684 per year or $35,568 per year. However, Maine requires employers to pay exempt employees a higher minimum salary of $816.35 per week or $42,450.20 per year.
3. Job Duties Test: The job duties performed by exempt employees fall under the following exempt categories:
   • Executive Exemption: Executive employees, who meet the salary level and basis tests, qualify as exempt if their main role involves managing an enterprise or a recognized department of a company, regularly directing the work of two or more full-time employees, and weighing in on crucial personnel decisions as well as possessing the authority to hire, fire, or make other significant employment decisions.
   • Administrative Exemption: Administrative employees who pass the salary level and basis tests are considered exempt if they perform office or non-manual work that is directly related to the management of their employer’s business and have the autonomy to make decisions on significant matters in the business.  
   • Professional Exemption: Professionals are considered exempt if they are paid on a salary basis, earn a salary that meets or exceeds the minimum salary threshold for exempt employees, perform work that requires advanced knowledge in a field of science or learning, and exercise independent judgment in their work. In Maine, this category includes creatives whose primary duties involve performing work that requires invention, imagination, originality, or talent in a recognized field of artistic or creative endeavor.

Non-exempt employees in Maine are entitled to a minimum compensation of $14.15 per hour as per the state’s minimum wage laws. Exempt employees are entitled to a minimum salary of $816.35 per week or $42,450.20 per year.

Eligible salaried employees in Maine earn overtime for all time worked over 40 hours in a workweek. Overtime pay is compensated at a rate of 1.5 times the regular pay. Eligible employees of state agencies can opt for 1.5 hours of compensatory time for every hour of overtime in lieu of monetary compensation for working beyond 40 hours in a workweek.

Maine labor laws permit the following deductions from an employee’s salary:

• Mandatory Wage Assignments: All deductions that are authorized by court orders or government agencies are permissible. These include child support, alimony, debts, and taxes. These deductions are given preference over other deductions.
• Voluntary Wage Assignments: Employees can authorize deductions such as contributions to health, savings, and retirement plans. Please note that voluntary authorizations for debt repayments require the authorization of an employee’s spouse. 
• Recovery of Overcompensation: Employers can recover an overcompensation that resulted from employer error. The deductions can be split across several pay periods. Further, the deducted amount cannot be more than 5% of an employee’s net salary.

Title 9-A of the Maine Revised Statutes limits the percentage of an employee’s salary that can be deducted to 25% of their earnings after the deduction of the mandatory wage assignments.

Maine labor laws provide various benefits and protections for employees in the state. Here are some key benefits and protections for employees in Maine:

• Workers’ Compensation: Employees who sustain work-related injuries or illnesses are entitled to workers’ compensation benefits, which can cover medical expenses and replace lost wages.
• Protection from Retaliation: Employees in Maine are protected from retaliation for requesting flexible work arrangements, reporting illegal activities or safety violations in the workplace, or participating in labor violation investigations against their employer. 
• Right to Fair Compensation: Employees in the state are entitled to a minimum compensation that is higher than the federal minimum wage for non-exempt employees and a minimum salary threshold for exempt employees.
• Rest Breaks and Paid Leave: Employees in Maine are guaranteed paid leave of up to 40 days in a year and 30-minute rest breaks for every six hours of work.

As a salaried employee in Maine, you have the right to report wage, overtime, minimum wage, safety, and health violations to the State of Maine Department of Labor by filling out the Maine state online complaint form.