Referendum Question 4, approved by Maine voters in November, 2016, raised the Maine minimum wage to $9.00 per hour, effective on January 7, 2017, and to $10.00 per hour effective as of January 1, 2018, with more annual increases in later years.
A consequence of that change was that the minimum salary in Maine for exempt employees under the “white collar” exemptions for executive, administrative and professional employees rose on January 7, 2017, to $519.25 per week, or $27,000 per year. On January 1, 2018, the minimum salary will rise again, to $576.93 per week, or $30,000 per year.
The Maine statute on the white-collar exemption from overtime, 26 M.R.S. §663(3)(K), grants the exemption to:
A salaried employee who works in a bona fide executive, administrative or professional capacity and whose regular compensation, when converted to an annual rate, exceeds 3000 times the State’s minimum hourly wage or the annualized rate established by the United States Department of Labor under the federal Fair Labor Standards Act, whichever is higher.
Until 2017, the federal minimum salary of $455 per week, or $23,660 per year, was higher than 3,000 times the Maine minimum wage of $7.50. This changed on January 7, 2017, when 3000 times the new Maine minimum wage of $9.00 became higher than the federal level, at $27,000. In 2018 that minimum will be 3,000 times $10.00 per hour, or $30,000. Persons paid lower salaries will lose exemption from overtime under §663(3)(K).
The U.S. Department of Labor continues to study an increase in the federal minimum salary level, but no action is expected until mid-2018. But while the federal increase is on hold, the yearly Maine increases go forward under Maine’s wage laws, which apply to all workers in Maine. The minimum salary is set to rise to $33,000 in 2019, and to $36,000 in 2020.
For questions concerning these requirements, please contact one of Rudman Winchell’s experienced labor and employment law attorneys.