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How to Hire Employees In Maine

Hiring in Maine for the first time can be challenging, especially with the state's complex employment laws. Whether you're hiring independent contractors, setting up a legal entity, partnering with a PEO, or using an Employer of Record (EOR), it's essential to understand the local employment landscape. Playroll's comprehensive guide is here to help, whether you're onboarding local talent or relocating team members.

Here are four primary ways companies can hire employees in Maine:

Establishing a local entity: Creating a legal entity in Maine allows for direct hiring, but it can be costly and time-consuming. However, it gives you full control over employment and reduces risk exposure.
Partnering with an Employer of Record (EOR): An EOR, like Playroll, takes on the legal responsibilities of employment, acting as the employer on your behalf. This option streamlines hiring, payroll, and compliance with Maine’s labor laws, helping you hire in Maine without navigating the complex legal landscape yourself.
Working with a Professional Employer Organization (PEO): A PEO, such as Playroll, co-employs your team, managing essential HR functions like payroll, benefits, and compliance. Partnering with a PEO ensures you meet Maine’s labor regulations while offering competitive employee benefits.
Hiring independent contractors: Hiring independent contractors can be more cost-effective, but Maine has strict contractor classification rules. Proper classification is essential to avoid penalties for misclassification when hiring in Maine.

Complying with Maine specific employment regulations and federal laws is critical to avoiding legal risks and costly fines. Our guide focuses on hiring in Maine, employment compliance, and how Playroll’s services can support your business as you navigate the complexities of hiring in the state.

Good To Know

As of 2023, Maine's population is approximately 1.35 million, making it one of the least populous states in the U.S.

Maine's economy is heavily influenced by industries such as healthcare, retail, and manufacturing, with a notable emphasis on shipbuilding and paper products.

The state has seen growth in sectors like renewable energy, biotechnology, and tourism, creating diverse employment opportunities.

Maine mandates that employers provide up to 40 hours of earned paid leave annually for employees, applicable to businesses with more than 10 employees.

Key Things to Know About Hiring in Maine

Labor Laws in Maine

Working Hours in Maine

Maine has specific employment and labor laws governing working hours, designed to protect employees’ rights and ensure fair compensation. Whether you’re hiring local employees or working with an Employer of Record (EOR), it's essential to understand the state's regulations around working hours to ensure compliance.

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‍1. Standard Workweek and Overtime

Standard Workweek: 40 hours per week.
Overtime Pay: Employees are entitled to 1.5 times their regular pay rate for hours worked over 40 in a workweek.
Exemptions: Certain employees, such as bona fide executive, administrative, or professional employees, may be exempt from overtime requirements.

2. Meal and Rest Breaks

Meal Breaks: Employers must provide a consecutive 30-minute unpaid or paid rest break after 6 hours worked. An employee may waive their right to a rest break, preferably in writing.
Rest Breaks: Shorter breaks are common but not required by law. These breaks must be paid and cannot be deducted from the employee’s time worked.

Minimum Wage in Maine

As of 2024, the minimum wage in Maine is $14.15 per hour. ‍

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Regional Minimum Wage Variations:

Portland: $15.00 per hour.
Rockland: $15.00 per hour.

Overtime in Maine

In Maine, employees are entitled to overtime pay at 1.5 times their regular rate for hours worked over 40 in a workweek. Certain employees, such as bona fide executive, administrative, or professional employees, may be exempt from overtime requirements. Employers must be aware of these classifications to ensure compliance.

Onboarding New Hires in Maine

We can help you get your new employee started in Maine fast, with a minimum onboarding time from just 1-2 working days. Note that the timeline is dependent upon registration with the local authorities, and begins after the employee has submitted all the required information on the Playroll platform.

For non-citizens of the US, a work eligibility assessment may be required, and can add three extra days to the onboarding time. If a follow-up is needed, there may be additional delays.

Please note that payroll cut-off dates can impact the actual first day of employment. Playroll’s payroll cut-off date is the 10th of the month, unless otherwise specified.

Payroll Taxes For Maine

Payroll taxes in Maine are deductions employers must take from employees’ wages and remit to the state. These taxes fund various state programs and services, including unemployment benefits and disability insurance. Examples of payroll taxes include:

State Income Tax: Maine imposes a progressive income tax ranging from 5.8% to 7.15%, depending on the employee's income level.
Unemployment Insurance Tax: Employers pay unemployment taxes, with rates ranging from 1.97% to 12.36%, based on the employer's experience rating.

Payroll Cycle in Maine

Employers in Maine are required to pay employees at established, regular intervals not to exceed 16 days for all wages earned to within 8 days of the payment date. Employers should ensure compliance with these regulations to avoid penalties.

Looking to grow your team in Maine?

Stay Compliant: Navigate Maine’s complex labor laws with ease.

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Maine Employment Taxes

Employment taxes and statutory fees affect both your payroll and your employees’ paychecks in Maine. Understanding the tax obligations for both employers and employees is crucial when operating in California's business landscape.

Employer Tax Contributions

Employers in Maine are responsible for several employment taxes, including state unemployment insurance and workers' compensation insurance. Employer payroll contributions are generally estimated at an additional 1.97% - 12.36% on top of the employee salary in Maine.

Employment Tax Type	Tax Rate
State Unemployment Insurance (SUI)	1.97% - 12.36%
Workers' Compensation Insurance	Varies by industry and employer history

Employee Tax Contributions

Employee tax contributions are generally estimated at 5.8% - 7.15% of employee salary in Maine.

Employee Payroll Tax Contribution	Tax Rate
State Income Tax	5.8% - 7.15%
Federal Income Tax	Varies based on federal tax brackets
Social Security Tax	6.2%

The tax-related information provided in this guide is intended for general guidance and informational purposes only. Reach out to our dedicated team for insights on remote hiring in Maine tailored to your needs.

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Benefit Requirements for Employers in Maine

Employers in Maine are required to adhere to specific regulations regarding employee benefits to ensure fair treatment and compliance with state laws. For comprehensive information, explore employee benefits packages.

Employee Benefits For Maine

Competitive benefits are essential for attracting and retaining top talent in Maine. Offering the right package helps employees feel valued and motivated. Our benefits experts understand the local labor market's trends, requirements, and expectations, ensuring your employees feel valued and supported. Common benefits in our Maine packages include:

Pension or 401(K)
Vision Insurance
Life Insurance
Medical Insurance
Dental Insurance
Health Savings Plan (HSA)
Flexible Spending Account (FSA)

Paid and Unpaid Leave Policies in Maine

Earned Paid Leave

Employees accrue one hour of paid leave for every 40 hours worked, up to 40 hours per year, for any reason.

Family and Medical Leave

Up to 10 weeks of unpaid leave within a two-year period for qualifying events.

Paid Family and Medical Leave (PFML)

Paid leave benefits start on May 1, 2026, with contributions beginning January 1, 2025.

Jury Duty Leave

Employers must provide unpaid leave for jury duty without penalty.

Military Leave

Unpaid leave for military service, in line with federal and state laws.

It’s Easy To Manage Benefits For Employees In Maine With Playroll

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Employment Termination Protocols in Maine

Hiring Employees in Maine with an employer of record

Discuss how an EOR handles onboarding, including setting up compliant employment contracts, registering for taxes, and managing benefits like Maine's superannuation system (if applicable).

The employer of record is responsible for:

Employment Compliance: Ensure all employment contracts comply with Maine's labor laws and regulations, including proper classification of employees.
Payroll Management: Calculate, process, and distribute employee salaries in accordance with Maine's payroll laws, including deductions for taxes and social security contributions.
Tax Filing and Contributions: Handle the registration, filing, and payment of employer taxes and social security contributions to the relevant authorities.
Employment Contracts: Draft and maintain compliant employment agreements, detailing salary, benefits, working hours, and termination terms in line with Maine's legal requirements.
Benefits Administration: Provide mandatory employee benefits as required by Maine's labor laws, such as health insurance, pension contributions, and statutory leave.

Employer of Record for Maine

Guide to Hiring Employees in Maine