Changes Ahead: New Maine Rules on PTO Accrual & Minimum Pay for Reporting to Work

The most recent legislative session saw the passage of at least two bills that will affect Maine employers’ payroll and record keeping practices this coming fall.

An Act to Amend the Law Governing the Accrual of Earned Paid Leave

Signed into law by Governor Mills on July 1, 2025, LD 55 amends accrual caps under the Maine Earned Paid Leave statute, 26 M.R.S.A. § 637.  The prior version of the statute provided that an employee is entitled to earn one hour of paid leave for every 40 hours worked, up to 40 hours in one year of employment, and did not specifically address the carryover of accrued, but unused paid time off into the subsequent year.  However, guidance provided by the Maine Department of Labor clarified that if an employee rolled over accrued but unused earned paid leave into the next year, employers could cap earned paid leave accrual at 40 hours.  For example, if an employee rolled over 40 hours of accrued unused time, the employee would not accrue additional earned paid leave until the following year.  Or, if an employee rolled over 8 hours of accrued unused time from the previous year, the employee could accrue up to 32 additional hours of earned paid leave in the present year, capped at 40 hours of accrual.

As of September 24, 2025, an employee will still be entitled to earn at least one hour of paid leave for every 40 hours worked, but the statute will now also provide that:

1. An employee can roll over all accrued unused earned time to the following year; and
2. The roll over may not reduce earned time accruals in the present year.  In other words, if an employee is entitled to accrue 40 hours in any year and rolls over 40 hours, the employee can accrue another 40 hours, up to 80 hours, in the present year.  If the employee rolls over 25 hours, the employee can accrue up to 55 additional hours in the present year. 

Notably, there does not appear to be anything in the statutory amendment that would prohibit an employer from capping the amount of earned paid time an employee may actually use in a given year, even if earned paid time balances remain higher. The amendment will be enforced by the Department of Labor “within existing resources using strategic enforcement” so it remains to be seen what further guidance the Department of Labor will offer in the coming months on the practical impact of this amendment.

In the meantime, employers should evaluate their current Earned Paid Leave and paid time off policies to ensure they are compliant with accrual amendments and be prepared to adjust their payroll and internal record keeping systems accordingly, effective September 24, 2025. Employers should also verify that any third-party payroll providers have taken steps to implement these changes, effective September 24, 2025

An Act to Require Minimum Pay for Reporting to Work

A second notable change coming September 24, 2025 is Maine’s new “Report to Work” law, LD 598, passed into law on June 24, 2025 without Governor signature. This law applies to employers that have 10 or more employees in the regular course of business for more than 120 days per calendar year. The law does not apply to workers in a seasonal industry (as defined by Maine law) or public sector employees covered by a collective bargaining agreement.   

Under the Report to Work law, if an employee reports to work and is sent home because their shift is canceled or shortened, the employer is still required to pay that employee the lesser of:

1. Two hours of pay at the employee’s regular hourly rate, or
2. The total amount the employee would have earned for the originally scheduled shift.

For example, if the employee was scheduled to work a four-hour shift but is sent home after one hour, the employee must be paid for two hours.  If the employee was only scheduled to work for one hour and is sent home after fifteen minutes, the employee must be paid for the one-hour shift.  When calculating this wage for tipped employees, the employer must use Maine’s full minimum wage ($14.65 for 2025), not the tipped wage ($7.33 for 2025).

Exceptions are provided under the law if the employee is prevented from working due to adverse weather, a natural disaster or civil emergency, or the employee’s own illness or workplace injury.  In addition, an employer may avoid liability under the law by making a documented good faith effort to notify an employee not to report for work.   

The Maine Department of Labor may but has not yet adopted rules to implement and enforce Maine’s new Report to Work law.

At a minimum, qualifying Maine employers should continue maintaining accurate time records for hourly employees but adjust their mentality and payroll, effective September 24, 2025, to pay those employees who leave shifts early for qualifying reasons pursuant to statutory requirements, rather than the traditional “payment for hours worked” calculation.