The Maine Supreme Judicial Court has unanimously rejected a constitutional challenge brought by the Maine State Chamber of Commerce against state labor department rules implementing Maine's Paid Family and Medical Leave Act, in a decision that clears the way for the program to proceed as planned.
In *Maine State Chamber of Commerce v. Department of Labor* (2025 ME 82), decided Aug. 26, the court held that rules promulgated by the Maine Department of Labor do not conflict with the 2023 Paid Family and Medical Leave Act and do not constitute a taking of private property under either the Maine Constitution or the U.S. Constitution.
The case reached the state's highest court through a report from Kennebec County Superior Court, which submitted three questions of law regarding the legality and constitutionality of the department's administrative rules. Justice Mead wrote the opinion for the five-member panel, which included Chief Justice Stanfill and Justices Horton, Lawrence, and Douglas.
The legal challenge centered on the implementation of Maine's Paid Family and Medical Leave program, which the Legislature established in 2023 through P.L. 2023, ch. 412. The program, set to begin May 1, 2026, will allow covered individuals to take up to 12 weeks of leave from employment for qualifying family and medical reasons.
The PFML program operates through a state-run fund that accumulates contributions from both employers and self-employed individuals who elect coverage. These payments, referred to in the statute as "contributions," "premiums," or "premium contributions," finance benefit payments to workers taking qualifying leave.
The Chamber of Commerce and other business groups challenged the Department of Labor's rules implementing the program, raising both statutory interpretation and constitutional issues. The plaintiffs argued that the department's regulations exceeded the authority granted by the Legislature and violated constitutional protections against government taking of private property.
However, the Supreme Judicial Court found no merit in these arguments. The court determined that the Department of Labor's administrative rules stay within the bounds of authority delegated by the Legislature in the 2023 Act. The justices concluded that the rules properly implement the statutory framework without adding unauthorized requirements or exceeding the department's regulatory power.
On the constitutional question, the court rejected the Chamber's argument that the program constitutes an unconstitutional taking of private property. The justices analyzed the program under both state and federal constitutional standards for regulatory takings, finding that the PFML contributions do not rise to the level of a compensable taking.
The decision represents a significant victory for supporters of Maine's paid family leave program, which was designed to provide income replacement for workers who need time off to care for family members or address their own serious health conditions. The program follows similar initiatives in other states that have established paid family and medical leave benefits funded through payroll contributions.
The court's ruling addresses concerns raised by business groups about the scope and implementation of the program. By upholding the Department of Labor's rules, the decision provides clarity for employers who must prepare for the program's launch in May 2026.
The case was decided based on an agreed statement of facts and exhibits submitted by both parties as part of a consented motion to report the legal questions to the Supreme Judicial Court. This procedural approach allowed the court to address the constitutional and statutory interpretation issues without a full trial on disputed facts.
The Maine Chamber of Commerce's challenge reflects broader business community concerns about the costs and administrative burdens of the paid family leave program. Business groups have raised questions about the program's impact on small employers and the mechanics of collecting and remitting contributions to the state fund.
Despite these concerns, the Supreme Judicial Court's decision affirms that the Legislature acted within its authority in creating the program and that the Department of Labor has properly implemented the statutory requirements through its administrative rules.
The ruling comes as Maine prepares to join a growing number of states offering paid family and medical leave benefits. The program represents a significant expansion of worker benefits in Maine, providing financial support for employees who previously would have had to take unpaid leave or potentially lose their jobs when facing family or medical emergencies.
With the constitutional challenge resolved, attention now turns to the practical implementation of the program. Employers across Maine will need to begin collecting contributions and preparing their workforces for the new benefit option when it becomes available in May 2026.
The Department of Labor can now proceed with full implementation of its rules, knowing that the state's highest court has validated both the program's legal foundation and the department's regulatory approach. This legal certainty should help ensure smooth rollout of the program and clear guidance for covered employers and employees.