A Guide: HR Advice for Local Governments in Maine

Municipalities should ensure that employees working within city limits are paid at least the applicable local rate. Regularly reviewing job classifications and updating payroll systems helps avoid compliance issues and keeps pay practices consistent across departments.

 

Worker's Compensation Insurance

Workers’ compensation insurance provides benefits for any occupational injury and/ordisease suffered by an employee to covers medical expenses, lost wages, and rehabilitation costs—regardless of who is at fault. In Maine, workers’ compensation is the exclusive remedy for job-related injuries, meaning employees generally can’t sue their employer for those injuries if coverage is in place.

Almost all public employers in Maine are required by law to carry workers’ compensation coverage. This includes state agencies, counties, cities, towns, water districts, and other municipal entities. Failing to secure coverage can lead to serious penalties, including fines, criminal charges, and personal liability for medical and wage payments related to a claim.

Municipalities and other employers can obtain workers’ compensation insurance through:

• A licensed insurance carrier or producer.
• Self-insurance, if the employer qualifies financially.
• Maine Employers’ Mutual Insurance Company (MEMIC), which provides coverage to employers unable to secure it elsewhere.

Government employer, you’ll want to ensure that your HR and payroll systems track any injuries and maintain clear documentation to avoid penalties or fines.

 

Maine Employment Security Act

The Maine Employment Security Act governs unemployment insurance in Maine and outlines an employer’s responsibilities when it comes to funding and managing unemployment benefits. For government employers, this means understanding how contributions work, maintaining accurate payroll and employment records, and knowing how layoffs, seasonal schedules, or reduced hours may trigger unemployment claims.

From an HR perspective, compliance with this law starts with documentation and proactive communication. HR teams should:

• Keep detailed records of employee classifications, wage history, and separation reasons.
• Report new hires and rehires within the required timeframe to prevent fraudulent claims.
• Respond promptly to unemployment claim notices to ensure that information is accurate and benefits are properly assigned.

 

Having clear HR policies around separations, layoffs, and job changes not only helps employees understand their rights—it also protects municipalities and other public employers from unexpected unemployment tax liabilities or compliance issues. Staying organized and consistent in your HR processes is the best way to stay compliant under the Maine Employment Security Act.

 

Union Compliance

For municipalities and other public employers in Maine, union compliance is an essential part of HR management. The Maine Public Employees Labor Relations Law outlines specific rights and responsibilities for both employers and employees—and violating these rules can lead to serious legal consequences.

Public employers must not interfere with or discourage employees from joining or participating in a union. They also cannot discriminate based on union membership, influence the formation or administration of an employee organization, or refuse to bargain in good faith with recognized bargaining agents.

For HR teams, compliance starts with clear communication, documentation, and consistency. This means:

• Maintaining neutrality during union activity and negotiations.
• Ensuring policies and actions align with collective bargaining agreements.
• Keeping detailed records of communications and decisions related to union matters.
• Partnering with legal and HR experts to navigate complex bargaining and grievance procedures.

By approaching union compliance proactively, municipalities can reduce disputes, foster collaboration, and focus on their shared goal—serving the community effectively.

FMLA & Maine PFML for Public Employers

In Maine, government employers must understand how both the federal Family and Medical Leave Act (FMLA) and the new Maine Paid Family and Medical Leave (PFML) program apply to their workforce. While both laws provide job-protected leave for similar reasons, they differ in who pays for the time off and how benefits are funded.

Family and Medical Leave Act (FMLA)

Under the federal FMLA, eligible employees are entitled to up to 12 weeks of unpaid, job-protected leave per year for qualifying family or medical reasons. This includes:

• The birth, adoption, or foster placement of a child
• Caring for a spouse, child, or parent with a serious health condition
• An employee’s own serious health condition that prevents them from working

FMLA applies to all public agencies, including state, county, and municipal governments with 50 or more employees.

Maine Paid Family and Medical Leave (PFML)

Maine’s new PFML program expands on the concept of job-protected leave by providing partial wage replacement during qualifying leave periods. Similar to unemployment insurance, PFML will be funded through employee and/or employer payroll contributions.

While the reasons for taking leave are nearly identical to those covered under FMLA, PFML allows eligible employees to receive a portion of their wages while they are away from work. This program aims to make it easier for employees to balance work and family responsibilities without sacrificing income.

**Public employers and employees who were covered by a collective bargaining agreement (CBA) in effect as of October 25, 2023, are not required to participate in Maine PFML until that agreement expires. Public employees not covered by a collective bargaining agreement are automatically included in the PFML program and will participate the same way as private sector workers.**

For HR teams in the public sector, the key is preparation—understanding eligibility timelines, adjusting payroll systems for contributions, and reviewing leave policies to align with both FMLA and PFML requirements.

The Importance of Finding and Retaining Talent

Just like any other industry, government agencies and municipalities need to focus on attracting and retaining top talent. Recruiting the right people for public service can be challenging—budgets are often tight, and private-sector employers may offer higher salaries or more flexible work options. That’s why it’s important for municipalities to be intentional in every stage of the employee lifecycle: recruitment, development, and retention.

1. Recruiting the Right People

Start by building a strong foundation. Write clear, engaging job descriptions that highlight not just the duties but also the purpose and community impact of each role. Promote job openings on local and statewide platforms, and make sure your hiring process is fair, efficient, and transparent. Consider using digital onboarding tools to streamline new hire paperwork and get employees connected quickly.

2. Develop Your Team

Once employees are in the door, investing in training and professional development goes a long way. Offer opportunities for skill building, mentorship, and cross-department collaboration. Encourage continuing education and certifications—especially for roles in compliance, public safety, and administration. A well-trained workforce not only improves service quality but also helps ensure compliance with evolving laws and regulations.

3. Retaining Your Talent

It’s far more cost-effective to retain good employees than to replace them. Building a culture of recognition, communication, and growth helps employees feel valued. One of the most effective ways to retain staff is through competitive benefits—like strong health insurance, retirement plans, and fringe benefits that go beyond the basics. 

By focusing on recruiting with purpose, developing your workforce, and offering meaningful benefits, public employers can strengthen not only their organizations—but the communities they serve.

Government HR FAQ's

What are some unique HR challenges with Maine’s municipal and government employees?

Government employers deal with many compliance rules and regulations involving pay, benefits, union contracts, and public records. Many also have to deal with exclusive strict labor laws that are unique to Maine. Additionally, smaller municipalities have limited HR staff which can make it challenging to stay on top of evolving regulations.

How should employers handle union and employee pay? 

Union contracts can often be complex and include special pay rules such as blended overtime or shift differentials. Employers should maintain clear communication with union representatives and ensure that their payroll system can handle any complexities associated with union contracts and pay.

How should employers handle discipline or termination? 

It is important to understand that public-sector employees have more additional and complex protections versus regular employees. So, it can be challenging when it comes handling discipline and termination of employees. However, following a documented and consistent process through HR or through legal advice can help in compliance with state law and other regulations.

What are common payroll issues specific to Maine government employees? 

Government payroll must account for a few different issues such as multiple pay rates, seasonal workers, and special tax reporting. Automated systems and processes can help handle these complexities, reduce errors and ensure compliance with both the state of Maine and any federal regulations.

Conclusion 

Managing HR in municipalities and local governments isn’t easy. Between navigating union contracts, complex pay structures, and constantly changing compliance requirements, it can feel like a full-time job on its own. But you don’t have to handle it all internally.

With the right HR guidance and support, government employers can shift their focus from paperwork and policies to what really matters—serving their community and developing dedicated, high-quality employees.