Pay Up: New Maine Minimum Wage in 2019 Which Also Affects Salaried Employees

Starting in January 2019, Maine’s minimum wage goes up to $11.00 an hour. Is there a new poster that goes with that change?  Yes there is, and you can print it free from this link:  https://www.maine.gov/labor/posters/2018/minimumwage.pdf

That minimum wage rate also affects the minimum that must be paid to salaried employees in order to keep them exempt (that means, so you don’t have to pay them overtime). The new minimum salary requirement will be $634.62 per week. Where did this come from??  State law requires that overtime-exempt employees be paid an annual salary that “exceeds 3,000 times the State’s minimum hourly wage or the annualized rate established by the United States Department of Labor under the federal FLSA, whichever is higher” (26 MRS §663(3)(K)).  This is under state law.  To avoid paying overtime to exempt employees, employers must now 1) pay these employees at least $634.62 a week; 2) have them performing exempt work; and 3) follow the “salary test” (which generally means no deductions from that salary each week).

Hourly employees can be paid by several different methods, including by salary, although paying them salary makes it more complicated to figure out how much they should be paid for overtime hours. The Maine DOL has useful guidance at: http://www.maine.gov/labor/labor_laws/overtime.html regarding different pay methods allowed under state and federal law. Compensatory or “comp” time cannot be used by private-sector employers, although private-sector employers can allow employees to flex their time within the work week (but not the pay period if the pay period is longer than a seven day cycle). In the area of wage and hour law, each week stands alone.

And take advantage of those state resources! Employers with questions about the law can visit the DOL’s webpage on the minimum wage at: http://www.maine.gov/labor/labor_laws/minimum_wage_faq.html Guidance on overtime exemptions is at: https://www.maine.gov/labor/labor_laws/overtime.html . You can always call the Maine Department of Labor at (207) 623-7900 for advice as well.

____________________________________
This article is not legal advice but should be considered as general guidance in the area of employment and corporate law. Rebecca S. Webber, Amy Dieterich, James F. Pross, and Jordan Payne Hay, are employment and labor law attorneys; others at the firm handle business and other matters. You can contact us at 207.784.3200. Skelton Taintor & Abbott is a full service law firm providing legal services to individuals, companies, and municipalities throughout Maine. It has been in operation since its founding in 1853.