An Act To Support Maine's Employers and Encourage Employers To Hire Young Workers
Maine Legislature, Session 128, LD 1609
Committee: Labor, Commerce, Research and Economic Development
Sponsors: CUSHING, HAMPER, TIMBERLAKE, WINSOR
Amends: 26 MRSA §603, 26 MRSA §663, 26 MRSA §664

Legislative Document
No. 1609
S.P. 565
In Senate, May 16, 2017
An Act To Support Maine's Employers and Encourage Employers 
To Hire Young Workers
Reference to the Committee on Labor, Commerce, Research and Economic Development 
suggested and ordered printed.
HEATHER J.R. PRIEST
Secretary of the Senate
Presented by Senator CUSHING of Penobscot.  (GOVERNOR'S BILL)
Cosponsored by Senator: HAMPER of Oxford, Representatives: TIMBERLAKE of Turner, 
WINSOR of Norway.
Be it enacted by the People of the State of Maine as follows: 
Sec. 1.  26 MRSA §603, sub-§3, ¶E, as enacted by PL 1999, c. 750, §1, is 
amended to read: 
E.  A salaried employee who works in a bona fide executive capacity and whose 
regular compensation, when converted to an annual rate, meets or exceeds 3000 times 
the State's minimum hourly wage the annualized rate established by the United States 
Department of Labor under the federal Fair Labor Standards Act; 
Sec. 2.  26 MRSA §663, sub-§3, ¶K, as amended by PL 2009, c. 529, §2, is 
further amended to read: 
K.  A salaried employee who works in a bona fide executive, administrative or 
professional capacity and whose regular compensation, when converted to an annual 
rate, meets or 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 or who is a highly compensated employee 
or meets the occupational exemptions as described in that Act and not otherwise 
provided for under this chapter; and 
Sec. 3.  26 MRSA §663, sub-§12, as amended by PL 2007, c. 360, §2, is further 
amended to read: 
12.  Automobile mechanic.  "Automobile mechanic" means a person who is 
primarily engaged in the servicing of automobiles or trucks as an employee of an 
establishment primarily engaged in the business of selling automobiles or trucks to the 
ultimate purchaser, as long as the person's annual compensation meets or exceeds 3,000 
times the state 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, except when the employee is paid by the employer on an hourly basis. 
Sec. 4.  26 MRSA §663, sub-§13, as amended by PL 2007, c. 360, §3, is further 
amended to read: 
13.  Automobile parts clerk.  "Automobile parts clerk" means a person employed 
for the purpose of and primarily engaged in requisitioning, stocking and dispensing 
automobile parts as an employee of an establishment primarily engaged in the business of 
selling automobiles or trucks to the ultimate purchaser, as long as the person's annual 
compensation meets or exceeds 3,000 times the state 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, except when the employee is paid by the 
employer on an hourly basis. 
Sec. 5.  26 MRSA §663, sub-§14, as enacted by PL 2007, c. 360, §4, is amended 
to read: 
14.  Automobile service writer.  "Automobile service writer" means a person 
employed for the purpose of and primarily engaged in receiving, analyzing and 
referencing requests for service, repair or analysis of motor vehicles as an employee of an 
establishment primarily engaged in the business of selling automobiles or trucks to the 
ultimate purchaser, as long as the person's annual compensation meets or exceeds 3,000 
times the state 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, except that "automobile service writer" does not include an employee who is paid 
by the employer on a an hourly basis. 
Sec. 6.  26 MRSA §663, sub-§15, as enacted by PL 2011, c. 118, §2, is amended 
to read: 
15.  Tip.  "Tip" means a sum presented by a customer in recognition of services 
performed by one or more service employees, including a charge automatically included 
in the customer's bill.  "Tip" does not include a service charge added to a customer's bill 
in a banquet or private club setting by agreement between the customer and employer. 
Sec. 7.  26 MRSA §664, sub-§1, as amended by IB 2015, c. 2, §1, is further 
amended to read: 
1.  Minimum wage.  The minimum hourly wage is $7.50 per hour.  Starting January 
7, 2017, the minimum hourly wage is $9.00 per hour; starting January 1, 2018, the 
minimum hourly wage is $10.00 $9.50 per hour; starting January 1, 2019, the minimum 
hourly wage is $11.00 $10.00 per hour; and starting January 1, 2020, the minimum hourly 
wage is $12.00 $10.50 per hour.  On; and starting January 1, 2021 and each January 1st 
thereafter, the minimum hourly wage then in effect must be increased by the increase, if 
any, in the cost of living. The increase in the cost of living must be measured by the 
percentage increase, if any, as of August of the previous year over the level as of August 
of the year preceding that year in the Consumer Price Index for Urban Wage Earners and 
Clerical Workers, CPI-W, for the Northeast Region, or its successor index, as published 
by the United States Department of Labor, Bureau of Labor Statistics or its successor 
agency, with the amount of the minimum wage increase rounded to the nearest multiple 
of 5¢., the minimum hourly wage is $11.00 per hour.  If the highest federal minimum 
wage is increased in excess of the minimum wage in effect under this section, the 
minimum wage under this section is increased to the same amount, effective on the same 
date as the increase in the federal minimum wage, and must be increased in accordance 
with this section thereafter but in no case may the minimum wage exceed the minimum 
wage otherwise in effect under this section by more than $1 per hour. 
Sec. 8.  26 MRSA §664, sub-§§1-A and 1-B are enacted to read: 
1-A.  Training wage.  Notwithstanding subsection 1, a training wage of not less than 
either 80%, rounded to the nearest 5¢, of the state minimum wage under subsection 1 or 
the minimum wage under the federal Fair Labor Standards Act, whichever is higher, may 
be paid for the first 90 consecutive days of employment to an employee who has not 
attained 20 years of age. 
1-B.  Youth wage.  Notwithstanding subsection 1, a youth wage of not less than 
either 80%, rounded to the nearest 5¢, of the state minimum wage under subsection 1 or 
the minimum wage under the federal Fair Labor Standards Act, whichever is higher, may 
be paid to an employee who has not attained 18 years of age and who is not covered 
under federal law. 
Sec. 9.  26 MRSA §664, sub-§2, as amended by IB 2015, c. 2, §2, is further 
amended to read: 
2.  Tip credit.  An employer may consider tips as part of the wages of a service 
employee, but such a tip credit may not exceed 50% of the minimum hourly wage 
established in this section.  Starting January 1, 2017, the minimum cash wage paid 
directly to a tipped service employee may not be less than $5.00 per hour, and the tip 
credit may not exceed the difference between the minimum cash wage paid directly to a 
tipped service employee and the minimum hourly wage established under subsection 1.  
Starting January 1, 2018, and on each January 1st thereafter, the minimum cash wage 
paid directly to a tipped service employee must be increased by an additional $1.00 per 
hour until it reaches the same amount as the annually adjusted minimum hourly wage 
established under subsection 1, except that if the minimum cash wage paid directly to a 
tipped service employee is less than $1.00 less than the annually adjusted minimum 
hourly wage, it must be increased by that lesser amount.  An employer who elects to use 
the tip credit, until it is eliminated under this subsection, must inform the affected 
employee in advance and must be able to show that the employee receives at least the 
minimum hourly wage when direct wages and the tip credit are combined.  Upon a 
satisfactory showing by the employee or the employee's representative that the actual tips 
received were less than the tip credit, the employer shall increase the direct wages by the 
difference. 
The tips received by a service employee become the property of the employee and may 
not be shared with the employer.   Tips that are automatically included in the customer's 
bill or that are charged to a credit card must be treated like tips given to the service 
employee.  A tip that is charged to a credit card must be paid by the employer to the 
employee by the next regular payday and may not be held while the employer is awaiting 
reimbursement from a credit card company. 
Sec. 10.  26 MRSA §664, sub-§2-B, as enacted by PL 2011, c. 118, §4, is 
repealed and the following enacted in its place: 
2-B.  Service charges.  A compulsory charge for service is not a tip.  Such a charge 
is part of the employer's gross receipts.  Sums distributed to employees from service 
charges may not be counted as tips received, but may be used to satisfy the employer's 
minimum wage and overtime obligations.  If an employee receives tips in addition to the 
compulsory service charge, those tips may be considered in determining whether the 
employee is a tipped employee and in the application of the tip credit. 
SUMMARY 
This bill reduces increases to the minimum wage and provides a minimum wage of 
$11 per hour starting January 1, 2021.  The bill eliminates the annual cost-of-living 
adjustment to the minimum wage and reinstates the tip credit at 50% of the state 
minimum wage.  The bill allows employers to pay a training or youth wage subject to 
certain conditions including the training or youth wage's meeting or exceeding the federal 
minimum wage established under the federal Fair Labor Standards Act.  The bill changes 
the description of certain salaried employees who are exempt from the limits on 
mandatory overtime.  The bill changes the description of certain salaried employees who 
are exempt from the laws governing minimum wages.  The bill changes the definitions of 
"automobile mechanic," "automobile parts clerk," "automobile service writer" and "tip" in 
the laws governing minimum wages.  The bill amends the laws governing service charges 
in the minimum wage laws.