Legislative commission recommends strong, progressive paid family leave program for Maine

On February 7, the Commission to Develop a Paid Family and Medical Leave Benefits Program issued its final report, concluding more than a year of work examining the creation of a statewide benefit program available to almost all workers. The report contains a series of recommendations from the commission, outlining the parameters of a paid family and medical leave (PFML) program. If followed by the legislature’s Committee on Labor and Housing, these recommendations would create a robust program which would provide financial security to more than 600,000 Maine workers.

In forming its recommendations, the commission prioritizes affordability of contributions, accessibility of the program to workers and businesses, and adequacy of benefits, especially for workers with low income. And while the Commission did not achieve consensus on every detail of a potential program, their recommendations offer a clear roadmap for the legislature.

The commission proposes Mainers would be able to take up to 16 weeks of paid leave each year to care for themselves or a family member, with no more than 12 weeks at a time for any particular event. People taking leave would receive a weekly benefit equal to a portion of their typical earnings — either 80 or 90 percent. This benefit would be capped at 120 percent of the state’s average weekly wage (currently this would mean a cap on benefits of $1,240 a week).

To qualify, someone would need to have earned a minimum amount of wage income over the past 12 months. This could have been earned at any combination of jobs as long as the worker was making contributions into the PFML fund during this period. The commission did not indicate what this earning level should be, but programs in other states have specified relatively small earnings requirements — for example, $6,000 over the past 12 months. An employee would also have to prove they had a qualifying event such as an illness, birth of a child, or a sick relative.

The program would be funded through payroll contributions, which the commission recommends splitting between employers and employees. Maine’s smallest employers — those with fewer than 15 employees — would be exempt from contributing to the fund, though their employees would be fully covered. Self-employed workers could choose to opt into the fund and would only be responsible for paying the employee share of the contribution. The commission worked with a team of actuaries to estimate the costs of the program and determine an appropriate contribution rate. Depending on the benefit level chosen, the actuaries estimated that contributions would need to total between and 0.82% and 0.99% of wages.

The following examples demonstrate how the program’s contribution rates would benefit workers at different income levels:

Full-time worker earning $15 an hour ($600 a week). Their total weekly contribution would be between $4.92 and $5.94 per week. If the contributions were split evenly, they would have $2.46-$2.97 per week deducted from their paycheck, and their employer would pay the same amount each week. When they needed to take leave, the employee would be entitled to between $480 and $540 per week as a benefit.

Worker earning $21 an hour or $840 a week. Their share of the contribution would be between $3.44 and $4.16 a week, and their benefit would be between $672 and $756 per week.

Worker earning $40 an hour or $1,600 a week. Their share of the contribution would be between $6.56 and $7.92 per week, and their benefit would be capped at $1,240 per week.

According to the actuarial estimates, over 600,000 workers would be eligible for the program each year, or around 90 percent of the state’s total workforce (some of the gap is accounted for by self-employed workers and workers covered by more generous private plans opting out). This would be a huge improvement on the status quo. According to national figures, only 23 percent of Americans have access to a comprehensive PFML program through their employer. And even the state and federal laws offering unpaid leave only include around half of Maine workers.

PFML offers substantial benefits to individuals, businesses, and the economy as a whole. For workers, a statewide program would offer financial security and the reassurance they won’t have to choose between health and a paycheck. For businesses, allowing employees to take paid leave improves productivity, reduces turnover, and helps keep workers attached to their jobs. A statewide program helps level the playing field between the large businesses which already provide this benefit and smaller employers who would like to but can’t afford to administer their own benefit program. Research also shows paid leave reduces the rate at which people, especially women, drop out of the workforce altogether. It’s a critical tool in addressing Maine’s workforce shortage.

The report by the legislative commission presents a clear and viable roadmap to creating a statewide PFML program that will be available and affordable to most Maine workers. Maine Center for Economic Policy urges the legislature to seize this opportunity to enact these recommendations.