NFIB Sounds Alarm Against New Paid Leave Mandate Legislation

May 25, 2023 Last Edit: June 5, 2025

New Taxes, Regulations Will Burden Small Businesses Across Maine

NFIB Sounds Alarm Against New Paid Leave Mandate Legislation

AUGUSTA, ME (May 25, 2023) – The National Federation of Independent Business (NFIB), the state and nation’s leading small business advocacy organization, testified in the Capitol this afternoon before the Joint Standing Committee on Labor & Housing in opposition to newly introduced legislation, LD 1964, that would create an expensive state-run paid leave program with no meaningful relief for Maine’s small businesses. The bill implements the recommended scheme of the Commission to Develop a Paid Family and Medical Leave Benefits Program and would levy a new tax of up to 1% on wages and salaries. The previous legislature empaneled the 12-member statutory commission designed to create a proposal for a paid family and medical leave (PFML) program that would cover all employees and self-employed people in Maine. LD 1964 is the result and has been supported by progressive legislators and activist groups pushing for an expansive, mandatory state program. “With this ill-advised bill, progressive legislators and activist groups are pushing a program that greatly expands Maine’s family leave law and takes away existing protections that help small employers manage employee absences at a time when they are struggling to find enough workers to maintain regular hours or avoid unexpected closure of the small business,” said NFIB State Director David Clough. “Paying people to stay home for weeks when at the same time employers are struggling to find workers will be very difficult for small business owners across the state to manage and stay financially stable.” Clough noted in his testimony, “LD 1964 will, for the first time in Maine labor law, require that very small employers with only 1-14 workers provide long-term family leave. This would greatly compound the ongoing headaches small employers have ensuring adequate daily staffing of workplaces. These very small employers will lose the ability to accommodate worker needs in a way that balances those needs with what the employer believes is necessary to manage vacations of other workers, key projects, seasonal busy times, and other factors that weigh on small employers.” “Small businesses with 15-49 workers will see a double whammy of workers taking longer leave and for expanded situations,” continued Clough. “Instead of 10 weeks every two years, these small employers will have to provide up to 12 weeks of leave every year under terms dictated by a one-size-fits-all state law that ignores the daily realities of running a successful small business. NFIB members are very concerned about the new payroll costs and significant new workforce burdens that will be imposed by the paid leave program detailed in LD 1964. The legislation could make it much more difficult to employ workers and operate a successful small business.” NFIB Maine will work to educate lawmakers about the impact this bill will have on small businesses, many of which are already being hit by higher labor and operational costs, and especially the impact on thousands of small businesses that will lose vital protections built into existing leave laws. The main elements of LD 1964:

a mandatory paid leave program
coverage of all workers, whether full-time or part-time
coverage of all employers regardless of the size of the business
allows opt-in to the program or self-employed people
provides at least 12 weeks of paid leave annually
the imposition of a tax up to 1% on wages/salaries, capped at the Social Security taxable wage base, that is divided between employees and employers
employers of 15 or more workers would have to pay at least 50% of the tax
employers of 1-14 would not have to pay the employer share but would have to remit the employee share

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For 80 years, NFIB has been advocating on behalf of America’s small and independent business owners, both in Washington, D.C., and in all 50 state capitals. NFIB is nonprofit, nonpartisan, and member-driven. Since our founding in 1943, NFIB has been exclusively dedicated to small and independent businesses, and remains so today. For more information, please visit nfib.com.

Topics:

Taxes

State:

Maine

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NFIB Sounds Alarm Against New Paid Leave Mandate Legislation

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