Maine Will Now Require Vacation Payout When Employment Ends

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APPLIES TO

All Private Employers with 11+ Employees

EFFECTIVE

January 1, 2023

QUESTIONS?

Contact HR On-Call

(888) 378-2456

Beginning January 1, 2023, HP 160 will require private employers with 11 or more employees to pay all accrued, unused paid vacation when an employee leaves employment. Payment must be made no later than the next payday following exit. “Cessation of employment” includes the sale of a business. This means that all employees would be paid their unused vacation time when the business they work for is sold, even if they continue employment under the new ownership.

Violations for unpaid wages will also include unpaid vacation time, including interest, plus an amount equal to twice the amount of unpaid vacation for damages, costs, and attorney’s fees. Notably, the new law’s language is very similar to Maine’s recent Earned Paid Leave law regulations, so employers should watch for regulations from Maine’s DOL on how to comply with both laws and potentially overlapping requirements.

Action Items

  1. Review the bill here.
  2. Update employee exit procedures, including coordination with payroll administrators.
  3. Have appropriate personnel trained on new requirements.
  4. Subscribers can call our HR On-Call Hotline at (888) 378-2456 for further assistance.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2022 ManagEase