In 2019, Maine became the first state in the U.S. to require private employers to provide paid leave (to be used for any reason) to employees.
An Act Authorizing Earned Employee Leave mandates that private organizations that employ 10 or more employees for longer than 120 days in a calendar year give an employee one hour of paid leave for every 40 hours worked. The leave may not be limited to sick leave — employees are allowed to use their leave time for any reason.
Employers must pay the rate the employee was earning immediately before taking leave and provide the same benefits provided for other types of paid leave. Taking paid leave may not affect the employee's right to health benefits.
Employees start accruing leave on the first day of work but cannot use it until they have worked for 120 days. Earned leave maxes out at 40 hours per year under the law, which goes into effect on January 01, 2021.
The following employers are exempt: seasonal businesses; those with workers covered by a collective bargaining agreement; those with employees who work for fewer than 120 days; and those with fewer than 10 employees.
Employers that violate the law face up to a $1,000 fine per violation. Steven Silver "Maine Becomes First State to Mandate Paid Leave for Any Reason," shrm.org (Jun. 06, 2019).
Commentary and Checklist
Although Maine is the first state requiring paid leave that is not limited to sick leave, a number of states and even more jurisdictions have laws requiring paid sick leave. Employers must audit their practices to make sure they are in compliance with state or local laws concerning paid time off.
If you are required to provide paid sick leave, work with your legal counsel to confirm that your policies comply with all aspects of the law. For example, know if paid leave must be accrued or provided in a lump at the beginning of the year, if the amount of leave an employee can take at one time is regulated, and if unused paid leave can or must be rolled over to the next year.
Paid sick leave laws often require employers to allow employees to take time off for the illness of certain family members. Many states allow paid sick leave to be used for "safe" time related to domestic violence, sexual assault, and stalking. Also, allow employees to use paid sick leave for routine medical exams.
Keep in mind that, although federal law does not require employers to provide paid time off, the Family and Medical Leave Act (50 or more employees) does require up to 12 weeks of unpaid leave time for certain reasons. Also, the federal tax reform bill gives a tax credit to employers that provided two to 12 weeks, with at least a 50 percent wage replacement benefit, of paid family and medical leave.
Make sure your leave and attendance policies comply with federal law. Avoid attendances policies that mandate termination if an employee is absent a certain number of days for any reason, as these create exposure.
Even if your state does not require paid leave, providing paid sick and vacation days to your employees is a good idea. Research shows that taking time off improves health and productivity while reducing stress. Therefore, providing paid vacation days and encouraging employees to use them will likely improve performance and reduce health-related expenses.
In addition, paid vacation time is the second-most-important benefit to employees after health care. A "Project: Time Off" survey found that employees whose organizations encourage taking vacation are much happier with their jobs than those who work for organizations that discourage or are ambivalent about taking time off.
Here are some other things to consider, according to the Society for Human Resource Management (SHRM), concerning paid time off: