Maine Announces Rulemaking to Conform to Federal Overtime Rule Changes
The Wage and Hour Division of the Maine Department of Labor’s Bureau of Labor Standards has proposed changes to the state’s rules affecting salaried workers who are exempt from overtime. These reflect changes being made by the federal government and will apply to all employers in the state.
Commissioner of Labor Jeanne Paquette is encouraging all employers to communicate regularly with their employees, not only about what changes are being considered, but also how they will be implemented in ways intended to minimize the effect on operations and employee morale.
The state has proposed changes to the “Rules Governing Definitions for Executive, Administrative, and Professional Exemptions from Minimum Wage and Overtime” (proposed rule number: 2016-P162).
A public hearing will be held on Thursday, Nov. 3, 2016, from 10 to 11 a.m. at the department’s headquarters in Augusta. Public comments may be submitted by noon on Monday, Nov. 14, 2016 to :
Jeanne St. Pierre, Director of Legislative and Constituent Affairs
Maine Department of Labor
54 State House Station, Augusta, ME 04333-0054
Comments can also be emailed to Jeanne.StPierre@Maine.gov .
The rulemaking notice is available online.
Paquette says the Labor Department has scheduled several compliance assistance courses on “Federal Overtime Rule Changes as They Apply to Maine Employers.” Classes will be held in Augusta November 10th, 21st and 28th.
Paquette says most employers face some compensation changes to conform to the new rules issued by the U.S. Department of Labor.
"If employers have not yet done so, the Maine Department of Labor recommends that they develop a plan that includes conducting an internal analysis of exempt positions, identifying options, and implementing a plan to minimize negative effects on employee relations, direct payroll costs, indirect administrative costs, and general operations."
Employers are also advised to conduct their own classification analysis, to review those employees for whom they currently claim overtime exemptions, and decide whether to:
- Pay time and a half of the employee's regular rate of pay for any overtime work
- Convert to a fluctuating work week method (guaranteed salary with overtime at the half-time rate)
- Raise the employee's salary to at least the new threshold
- Limit the employee's hours to 40 hours or fewer per week.
- Some combination of the above.
The Maine Department of Labor has posted guidance for employers on its website
There are four major changes to USDOL's rules that Paquette says Maine law should align with to avoid creating compliance problems for employers.
- A new salary threshold for qualifying executive, administrative and professional exempt employees equaling $913.00 a week. This is an increase of $458 from the current required amount of $455 a week.
- An automatic increase in the salary threshold every three years based on a 40th percentile of weekly earnings for full-time salaried workers in the lowest paid region of the nation. The next increase is scheduled for Jan. 1, 2020. USDOL will provide at least a 150-day notice of the amount and effective date of future increases.
- An increase in the threshold for highly compensated employees (HCE) to $134,004 per year. HCE is not addressed in Maine's rules. Changes in Maine's rules will help clarify the department's position and align with USDOL.
- Allowing employers to credit up to 10 percent of the salary level with non-discretionary bonuses and/or commissions (other incentive pay), as long as they are paid at least quarterly or more frequent basis.
The department’s Bureau of Labor Standards helps workers and businesses make their worksites safer, educates about and enforces wage and hour laws and gathers information on working in Maine.
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