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As 2022 rolls over to 2023, the Maine Department of Labor is reminding employers of labor law changes, including an increase to the minimum wage and changes to vacation payouts.
Effective Jan. 1, the state minimum wage will increase more than a dollar from $12.75 to $13.80 an hour, based on data by the U.S. Department of Labor's Bureau of Labor Statistics.
Maine law, amended by referendum in 2016, requires annual adjustments to the minimum wage based on the cost-of-living index for the Northeast Region.
In addition to the minimum wage, the new "tip wage," or minimum wage for service employees such as waitstaff, will be $6.90 an hour next year. Service employees must receive at least a direct wage of $6.90 per hour from their employers. Employer also must be able to show that employees receive at least the minimum wage of $13.80 per hour when the direct wage and tips are combined at the end of a work week.
The minimum salary for exempting a worker from overtime pay is also based on the state minimum wage. Beginning Jan. 1, the new minimum salary threshold is $796.17 per week, or $41,401 per year.
The minimum salary threshold is only one of the factors used in determining whether a worker is exempt from overtime under federal or state law. The minimum wage and overtime law can be found here. The Maine Department of Labor also has more information available here.
Vacation payout
Also beginning Jan. 1, all unused accrued paid vacation must be paid to employees on their next regularly scheduled pay day after employment ends. The law does not apply to employers with fewer than 11 employees or a public employer. If employees are covered by a collective bargaining agreement that addresses payment of vacation pay at the end of employment, the collective bargaining agreement will determine if the unused accrued vacation pay is paid out at the end of employment.
This law change raised several interpretive questions about how the amended law interacts with Maine's earned paid leave law and the MDOL published interpretive guidance that to address the interaction of the laws.
General reminders
More information on these and other labor laws can be found here.
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