At a glance:
- LD 599 would align Maine’s salary threshold for overtime pay with the federal standard of $58,656, ensuring an additional 21,000 salaried workers are eligible for overtime protections
- MECEP estimates the bill would provide $6.7 million in additional wages annually to approximately 7,000 workers who currently work unpaid overtime
- Businesses can respond by limiting overtime, increasing salaries above the threshold, or paying overtime wages — changes they have already prepared for under the now-delayed federal rule
- The bill mirrors federal policy to minimize business disruption and includes periodic adjustments to maintain protections without eroding over time
Maine lawmakers will have another opportunity this year to ensure extra pay for low-wage salaried workers who work more than 40 hours a week with LD 599, “An Act to Codify the Federal Salary Threshold for Overtime Pay.” MECEP estimates this bill would ensure overtime protections for another 21,000 workers, providing them with $6.7 million in additional wages each year and a better work-life balance.1
While most hourly workers are automatically eligible for overtime pay when they work more than 40 hours a week, the standard for salaried workers is more complicated and depends on the kind of work they do. Workers in “executive, administrative, or professional roles” are generally exempt from overtime pay requirements. However, in order to ensure that low-paid salaried workers are not exploited and made to work unpaid overtime, both the US Fair Labor Standards Act and state law ensure that salaried workers who fall below a certain threshold are always eligible for overtime pay.
LD 599 would update the state’s salary threshold, which currently stands at $43,950 per year, to align with the new federal standard of $58,656 per year. This is an important move because while federal law would normally supersede state law, the federal standard has been put on hold pending action in federal courts. So, while Maine workers and employers have already prepared for the $58,656 level to take effect this January, there is now uncertainty about its future. LD 599 would resolve that future by ensuring whatever takes place in the courts, this standard will remain in place in Maine.
MECEP estimates just over 28,000 salaried workers in Maine will fall under the current state threshold in 2026. Codifying the federal rule into state law will guarantee those protections to an additional 21,000 workers. In total, just under 50,000 workers would be covered. That’s 22% of all salaried workers in the state, or 8% of the total workforce. While a meaningful benefit for those workers, this will still be far less than the 62% of salaried Americans covered by the threshold nationally in 1975.
This does not mean all 21,000 workers will receive more pay. MECEP estimates most of them don’t work overtime hours, and among those who do, some are already being paid for it. Approximately 7,000 people in this group do currently work unpaid overtime, either occasionally or regularly, and MECEP estimates the bill would guarantee $6.7 million in additional wages each year for these workers.
Employers can react to the increased threshold in several ways:
- Manage overtime hours so that employees only work 40 hours a week
- Increase employee salaries above the threshold to make them exempt again
- Pay time and a half for the hours worked beyond 40 per week
Because employers already started planning for the implementation of the federal rule this January, there should be minimal disruption from passage of LD 599.
To minimize disruption for businesses, LD 599 mirrors the federal rule as closely as possible. The threshold of $58,656 was chosen because it represents the level below which 35% of workers fall in the lowest-wage US census region (the south). A threshold that covered 35% of Maine workers would be somewhat higher but the intent in LD 599 is to mirror the federal rule.
LD 599 also follows the federal rule by requiring an adjustment to the threshold based on the cost of living on July 1, 2027 and every three years thereafter. This is less frequent than current state law (which occurs every year on January 1) but it will continue to ensure approximately the same number of workers are covered each year and we don’t erode the protections of the law over time
LD 599 offers lawmakers an opportunity to create certainty for Maine employers and to guarantee a work-life balance for Maine workers. They should take this chance and pass LD 599 into Maine law.
