Maine Has a New Vacation Law for 2023

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While the statute does not define “accrual” or “accrued,” state officials consider vacation time to be accrued “if the employee has a defined amount of time that is available to them at any given time, even if that amount may, at times, be zero.” This can include employees who accrue a certain number of hours per pay period or days per month.


Whether frontloaded vacation time is accrued depends on the employer’s policy or established practice, according to the Maine Department of Labor.

If the policy states that employees are credited with vacation as an advance against future accruals, the employer will be obligated to pay out all unused vacation which would have accrued at the time of separation – the employer is not obligated to pay out for unused vacation which would not yet have been accrued. If the employee used more time than would have been accrued at the time of separation, in this limited circumstance, the employer may deduct the amount of used, unaccrued time that exceeded what would have been accrued at the time of separation from the employee’s last paycheck.

Without a clear policy, the state will generally assume frontloaded vacation time is accrued.

If an employer has an unlimited vacation policy, it could be considered accrued “if the employee has a defined amount of time that is available to them at any given time.”

The law requires that employers pay accrued, unused vacation at the time of separation. No rollover form year to year is required.

Lastly, Maine law provides for restitution and fines from the state department of labor for unpaid wages which includes nonpayment of accrued vacation pay.

Employees who do not receive pay for their unused vacation time can sue their employers and seek damages in an amount of up to three times the unpaid figure, as well as interest and attorney fees.


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Lisa Smith, SPHR, SCP

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