No Vacation From Vacation Pay in Vacationland: Beware, Maine Employers!

Despite vital opposition from Maine’s enterprise group, together with the Maine State Chamber of Commerce and leaders within the tourism, hospitality, and small enterprise communities, Governor Janet Mills signed into legislation Legislative Doc (L.D.) 225, “An Act Concerning the Therapy of Trip Time upon the Cessation of Employment” on April 7, 2022. The legislation amends 26 M.R.S.A. § 626 to require every employer with greater than ten workers to pay its workers, on the cessation of employment, “[a]ll unused paid trip accrued pursuant to the employer’s trip coverage on and after January 1, 2023.”

Except for creating notable monetary burdens for companies throughout the state, L.D. 225 seems to battle with Maine’s Earned Paid Go away legislation and is already creating appreciable confusion for Maine’s enterprise group.

The newly enacted legislation doesn’t present a transparent definition of what depart it covers, except for “unused paid trip accrued pursuant to the employer’s trip coverage.” In keeping with written testimony supplied to the Maine Legislature by the Maine State Chamber of Commerce, Maine Division of Labor, and HospitalityMaine, a lot of Maine’s bigger employers are working to make clear their paid day off (PTO) packages and shifting away from versatile PTO, which advantages employers and workers alike, to separate sick depart and trip depart insurance policies. Different employers are revising their insurance policies to offer for “earned depart” or “private time.” The brand new legislation’s provisions additionally fail to handle employers’ capacity to set annual caps on carryover of unused paid depart.

Underneath L.D. 225, employers with “trip insurance policies” would seem like required to pay unused, accrued trip pay to workers discharged for misconduct, together with theft, assault, or different violations of office insurance policies.

With the enactment of L.D. 225, Maine’s new trip pay legislation, Maine turns into one in every of solely a handful of states, together with California, Colorado, and Massachusetts, mandating the fee of unused, accrued trip upon an worker’s separation from employment. For the reason that passage of Maine’s Earned Paid Go away legislation, the Maine Division of Labor stories having fielded a considerably elevated variety of inquiries from employers and workers on the subject of paid depart, and it expects this quantity to extend exponentially with the enactment of Maine’s trip pay legislation.