Maine Termination Laws

October 2nd 2024

Firing an employee is a complicated process, with important rules and exceptions that employers must follow. In Maine, federal and state regulations guarantee that terminations are handled fairly and legally.

This article discusses key aspects of Maine termination laws, covering at-will employment, employee protections, and exceptions.

This Guide Covers

Legal Considerations for Termination in Maine
At-Will Employment in Maine
Lawful Termination in Maine
Legal Protections During Termination in Maine
Terminated Employee Benefits in Maine
Layoffs in Maine
Resignations in Maine
Legal Cases Related to Wrongful Termination in Maine

Legal Considerations for Termination in Maine

While Maine is an at-will state, there are significant legal considerations that both employers and employees should be aware of. The employer must comply with the following to avoid legal liabilities:

  • Anti-Discrimination Protections: Federal and state laws prohibit terminations for protected-class reasons such as race, color, national origin, sex, pregnancy, age, religion, disability, sexual orientation, and gender identity. Any termination that appears discriminatory may lead to a lawsuit or investigation.
  • Retaliation Protections: Statutes prohibit employers from terminating employees to protect their legal rights, such as filing a discrimination claim, complaining of unsafe working conditions, or participating in union activities.
  • Final Paychecks: Maine law requires employers to pay employees their final paycheck on or before the next regular payday after the termination date. The paychecks must include all owed wages, including any accrued and unused vacation time if the company policy or a contract requires it.
  • Notice Requirement: Employers in Maine do not need to provide advance notice of termination unless it is related to mass layoffs or plant closings under the Maine Employment Termination Act (META). In the event of large-scale layoffs, employers may need to provide 60 days’ notice to employees under the Worker Adjustment and Retraining Notification Act (WARN).

At-Will Employment in Maine

What is At-Will Employment?

At-will employment provides that either employer or employee may terminate the employment relationship at any time, for any reason (or no reason), without any prior notice, provided it is based on an lawful reason. This is applicable to most employees in Maine unless there is a contract or agreement specifying otherwise.

What are the Exceptions to At-Will Employment in Maine?

Though Maine generally follows the at-will employment doctrine, there are exceptions where employee employment can be protected under specific circumstances. These exceptions include the following:

  • Implied Contracts: When there is an implied agreement, such as in employee handbooks or company policies that promise job security, the at-will doctrine may not apply.
  • Anti-Discrimination Laws: Maine law prohibits employers from terminating employees for discrimination based on race, gender, age, religion, disability, sexual orientation, or other protected characteristics.
  • Retaliation Protections: An employer cannot discharge an employee because of their participation in protected activities, such as filing a discrimination claim, reporting unsafe working conditions, or participating in union activities.

Employment Under Contract in Maine

Employment under contract in Maine involves a written contract agreement between the employer and the employee. Unlike at-will employment, wherein the relationship could end without cause, employment under contract has terms and conditions upon which either party could end the agreement.

Lawful Termination in Maine

Legal Grounds for Termination in Maine

Employers in Maine can fire employees at will or for a reason as long as it does not violate state and federal laws. The legal reasons for terminating an employee include:

  • Performance-Related Termination: Employers have the right to fire employees due to poor job performance, lack of productivity, or failure to meet job requirements. The termination is made due to actual poor performance, not on the grounds of discrimination.
  • Violation of Company Policies: Employers can terminate employees who commit an offense or violate company policies, such as insubordination, dishonesty, theft, or harassment.
  • Reductions in Workforce: Layoffs or downsizing due to economic reasons, restructuring, or business needs are valid reasons for terminating an employment relationship, provided that employees are treated fairly and the layoffs comply with applicable state and federal WARN Acts.
  • Expiration of Contract or Temporary Employment: Where an employee was employed under a contract that specified an end date or was considered for temporary work, the employee can be relieved from service once the contract lapses or the temporary work is finished.
  • No Contractual Obligation to Continue Employment: In the absence of any employment contract that outlines terms of employment or necessitates “just” cause for termination, an employer can fire an employee at will without providing an underlying reason, provided it is not discriminatory or retaliatory.

Read our comprehensive guide to firing employees in Maine for further information.

How Do I File a Wrongful Termination Claim in Maine?

To file a wrongful termination claim in Maine, you can start by submitting a complaint to the Maine Human Rights Commission (MHRC) if you believe your termination violated state anti-discrimination laws or public policy. You must file the complaint within 300 days of the termination.

The MHRC will investigate the claim and may offer mediation or pursue legal action if they find merit in the case. You can also file a claim with the Equal Employment Opportunity Commission (EEOC) for federal violations or consult an employment attorney to explore a lawsuit directly in court.

Legal Protections During Termination in Maine

Both federal and state laws provide protections for employees during termination. Here are key laws that govern terminations in Maine:

  • Title VII of the Civil Rights Act of 1964: Title VII of the Civil Rights Act of 1964 is a federal law prohibiting termination based on race, color, national origin, or sex. An employer cannot fire employees due to reasons connected with discrimination, and any such firings that are considered discriminatory can lead to a lawsuit.
  • Age Discrimination in Employment Act (ADEA): The ADEA protects employees aged 40 and above against termination under the pretext of their age. Employers must avoid age-related decisions when terminating older employees to avoid facing legal consequences.
  • Americans with Disabilities Act (ADA): The ADA prohibits termination based on an employee’s disability if the employee can perform essential functions of their job. An employer should not fire an employee solely because of a disability or related medical condition.
  • Family and Medical Leave Act (FMLA): The FMLA protects employees against termination or any other form of retaliation for taking unpaid leave for serious medical conditions or family care needs. Employers cannot terminate employees who want to exercise their right to FMLA leave.
  • Occupational Safety and Health Act (OSHA): The OSH Act of 1970 protects employees against retaliatory or punitive dismissal for reporting unsafe working conditions or exercising their rights under workplace safety laws. Terminating an employee for reporting safety complaints is illegal.
  • Maine Human Rights Act (MHRA): MHRA is a state law intended to protect employees from being fired for reporting illegal activities, safety violations, or other protected whistleblowing activities. Under this law, retaliatory termination is unlawful and subject to penalties.
  • Maine Whistleblowers’ Protection Act: The Maine Whistleblowers’ Protection Act is a state law that protects employees from termination for reporting illegal activities, safety violations, or engaging in protected whistleblowing activities. Retaliatory termination under this act is illegal and can lead to penalties.
  • Maine Employment Termination Act (META): The META provides specific protections to employees who are affected by mass layoffs or plant closings. Employers are required to follow severance pay and notice standards for covered terminations to ensure employees are fairly treated even in the event of massive layoffs.

Terminated Employee Benefits in Maine

Employees who are terminated in Maine may be eligible for several benefits depending on the circumstances of their termination:

  • Unemployment Benefits: Employees who were fired through no fault of their own, such as in layoffs or non-misconduct firings, may qualify for unemployment benefits. Unemployment insurance provides temporary financial assistance to help employees cover some of their daily needs while seeking new employment.
  • Health Insurance Continuation (COBRA): When employees are fired in Maine, they may be eligible to continue their health insurance coverage under COBRA. The Consolidated Omnibus Reconciliation Act (COBRA) is a federal law that applies to employers with 20 or more employees. Under COBRA, employees can keep their insurance for up to 18 months. For employees of smaller businesses with fewer than 20 employees, Maine Mini-COBRA applies. This law allows employees to continue their health insurance for up to 12 months.
  • Final Paycheck: Maine law requires employers to issue a terminated employee’s final paycheck by the next regular payday, covering all wages owed, including any accrued unused vacation or paid time off (PTO), if outlined in the company policy or contract.
  • Severance Pay: Severance pay is mandatory for plant closing, substantial shutdown, or relocation of a covered establishment. According to Maine 26 ME Rev Stat § 625-B-2, eligible employees must receive severance pay at a rate of one week’s pay for each year and partial pay for any year from the last full month of employment by the employee in that establishment. The severance pay must be paid in addition to the final wage payment and within one pay period after the employee’s last day of work.

Layoffs in Maine

Layoffs in Maine are primarily governed by the federal Worker Adjustment and Retraining Notification (WARN) Act, which requires employers with 100 or more full-time employees to provide at least 60 days’ notice before a mass layoff or plant closing. A mass layoff is defined as affecting 50 or more employees at a single site, while a plant closing involves shutting down a facility that results in 50 or more employees being laid off. Maine does not have its own WARN Act but has provisions regarding mandatory severance pay for employees affected by layoffs.

The Maine Severance Pay Act requires employers to provide severance pay to eligible employees affected by plant closings, substantial shutdowns, or relocations of a covered establishment. To qualify, employees must have worked at the establishment for at least three years before the closure or relocation.

Employees are entitled to one week’s pay for each year of service, with partial pay for any additional months worked during the last year. Severance pay must be paid in addition to the final wage payment and provided within one pay period after the employee’s last day of work.

Resignations in Maine

In Maine, there are two types of resignations, voluntary and involuntary.

Voluntary Resignations

A voluntary resignation occurs when an employee leaves their job without being pressured by the employer. In Maine, no specific laws require employees to provide notice before resigning, but it is customary to give at least two weeks’ notice. If an employment contract or company policy requires a notice period, failing to comply may affect certain benefits, like vacation payout or rehire eligibility.

Involuntary Resignations

Involuntary resignation occurs when an employee is forced or pressured to resign by their employer, often under the threat of termination. While it may appear voluntary, this type of resignation is treated as involuntary if the employee was coerced. In Maine, employees forced to resign under these circumstances may be eligible for unemployment benefits, depending on the reasons for the resignation. Employers must ensure they are not violating employment laws, such as discrimination or retaliation protections when seeking an involuntary resignation.

Legal Cases Related to Wrongful Termination in Maine

1. Former Project Manager Wins $300,000 in Disability Discrimination Case

In the case, Gary Webber v. International Paper, Gary was a project manager at International Paper’s Bucksport mill since 1983 and was terminated in July 2001 as a part of a company-wide reduction in force. Throughout his employment, Mr. Webber struggled with knee problems that required multiple surgeries, which often rendered him temporarily unable to work.

Shortly after his termination, Mr. Webber retained a lawyer and filed a complaint with the Maine Human Rights Commission. He sued the company for wrongful termination in violation of the Americans with Disabilities Act (ADA). International Paper subsequently offered him a new role as an SQA Coordinator, which was largely sedentary and offered the same pay and benefits. However, Mr. Webber declined the position, citing distrust and concerns about potential future termination.

In addition to his complaint, Mr. Webber applied for and was granted long-term disability benefits in August 2001. These benefits, paid at 70% of his salary, continued until October 2003.

The jury awarded Mr. Webber $1,000,000 in compensatory damages and $2,000,000 in punitive damages. However, the district court lowered the sum to $300,000 since Maine statute imposes a limit on such awards.

Key Lesson Learned from the Case:

Employees with ongoing medical conditions may be entitled to long-term disability benefits even after termination. The case emphasized there is available protection of such benefits post-employment.

2. Processing Plant Pays Former Warehouse Worker $385,000 After Disability Discrimination Case

In the case of Jacquelyn Quint v. A.E. Staley Manufacturing Company, Jacquelyn Quint was a former employee of A.E. Staley Manufacturing Company, a potato-starch processing plant in Maine. Initially a warehouse worker, she later transitioned to a press operator position, both of which required significant physical labor.

Over time, Ms. Quint began experiencing severe wrist pain and was subsequently diagnosed with bilateral carpal tunnel syndrome, a condition that severely limited her ability to perform strenuous tasks.

Upon her diagnosis, Ms. Quint’s doctor restricted her to light-duty work. Staley Manufacturing initially accommodated this restriction, assigning her to lighter tasks. However, she soon returned to her former role, which involved heavy labor despite her medical limitations.

A series of letters between Ms. Quint and the company followed, in which Staly requested multiple medical examinations. The company ultimately fired Ms. Quint when she failed to attend one of these company-ordered appointments.

Ms. Quint filed a lawsuit against A.E. Staley Manufacturing Co., alleging wrongful termination in violation of the Americans with Disabilities Act (ADA). She argued that the company discriminated against her due to her disability and failed to accommodate her condition reasonably. Both parties entered into settlement discussions, resulting in an oral agreement where Quint would receive $485,000 in exchange for releasing her claims and agreeing not to reapply for employment with the company.

Key Lessons Learned from the Case:
  • Employers are required to make reasonable accommodations for employees with disabilities under the ADA. In this case, the employer’s initial compliance, followed by a return to heavy labor, demonstrated a failure to maintain those accommodations.
  • Employers may require medical examinations to verify an employee’s condition, but terminating an employee for failing to attend such examinations must be justified. In this case, firing was deemed discriminatory and unjustified.

Learn more about Maine Labor Laws through our detailed guide.

Important Cautionary Note

This content is provided for informational purposes only. While we make every effort to ensure the accuracy of the information presented, we cannot guarantee that it is free of errors or omissions. Users are advised to independently verify any critical information and should not solely rely on the content provided.

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