Our organizations represent thousands of businesses of all sizes and sectors across Maine. Together, we support developing a paid family and medical leave program that works for both employers and employees. Over the last several months, we have made concerted efforts with lawmakers and policy leaders to collaborate on a legislative proposal that achieves this goal.

Unfortunately, the proposal the Legislature will consider is not paid family and medical leave. Instead, we view it as a new, short-term disability insurance program that will cost hundreds of millions of dollars and be one of the most benefit-rich programs in the country.

The proposed paid family and medical leave legislation was just released late last week. The bill, L.D. 1964, An Act to Implement the Recommendations of the Commission to Develop a Paid Family Medical Leave Benefits Program, including an expected amendment by its sponsor, is not workable or sustainable for Maine employers.

Our organizations will share our opposition to L.D. 1964 at the bill’s public hearing Thursday before the Legislature’s Labor and Housing Committee.

Here are our members’ top concerns if L.D. 1964 becomes law:

• The proposed program will be funded through a new payroll tax on employers and employees. The only cost estimate available to date, of hundreds of millions annually, was included in the 2022 Commission Report for a similar program. If the program requires more money for administration or benefit costs, L.D. 1964 authorizes annual increases in the tax amount on employers and employees.

• We are concerned the bill will worsen the workforce shortage crisis. This crisis shows no signs of correcting anytime soon, and the proposal does nothing to help small businesses with likely absenteeism in the workplace. L.D. 1964 allows up to 16 weeks annually of paid family and medical leave for all Maine employees, which we interpret could be stacked up in certain instances. These workplace absences would provide no certainty to employers trying to secure stable staffing levels.

• This law would be mandatory for every Maine employer and a significant new burden for Maine’s small businesses. Thousands of employers with fewer than 15 workers could, for the first time, be required to provide long-term leave to their employees, while at the same time maintain full benefit payments to both the worker on leave and their replacement.

• The potential for misuse is also problematic. The average Maine earner needs only roughly $6,000 in earnings over the course of a year to qualify for up to 16 weeks of leave annually at up to 90% of their wages. Employees could qualify for leave for anyone they consider having a “significant personal bond,” regardless of actual familial relation. This would be 100% subjective, and likely exacerbate absenteeism in the workplace.

• It is important to recognize the impact this bill will have on employers and employees who inevitably would have to manage with fewer staff and take on more work in the absence of a co-worker on leave. The availability of a hardship clause also discourages small businesses from growing beyond 15 workers.

We agree with this bill’s proponents that paid family and medical leave is one of the most important public policy issues this legislative session, yet as one of the last bills to be printed this legislative session – behind 1,963 others – there is not ample time for legislators to thoughtfully vet it.

We encourage Maine policy leaders and lawmakers to consider alternatives, such as extending the state’s existing family and medical leave program, or a bill that is more in line with neighboring New England states, four of which – Rhode Island, Connecticut, Vermont and New Hampshire – require zero employer taxes.

Although our organizations and others oppose this particular bill, we remain committed to continuing discussions with Maine lawmakers, policy leaders and other stakeholders to develop an affordable and sustainable leave program that works for both employees and employers.

We urge Maine legislators to oppose L.D. 1964. Together, let’s go back to the drawing board to develop a paid family and medical leave program that is workable for all.