Jill Moses, co-owner of Three Dollar Deweys in Portland and Saltwater Grille in South Portland, is among a group of business owners who are concerned about the proposed rules for the new Paid Family Leave law. Derek Davis/Staff Photographer

Restaurant owner Jill Moses believes that workers deserve paid family leave but is concerned that the program Maine will implement next year could make it even harder for businesses like hers to succeed, saying the hospitality industry already operates on very thin margins.

Moses, co-owner of Three Dollar Deweys in Portland and the Saltwater Grille in South Portland, is worried that the specific rules of the new law will make it difficult for seasonal industries like hers. Restaurants in Maine make much of their revenue during the summer tourist season, and the proposed rules for Maine’s paid leave program could cause a worker crunch during crucial times, she said.

“People are already stretched thin in the restaurant industry,” Moses said. “It seems as though in the rulemaking process, hospitality was not taken into consideration.”

The Maine Department of Labor has published proposed rules that detail how the new law will be implemented, and people have an opportunity to comment on them through July 8.

Moses and other business owners and executives took part in a news conference hosted Thursday by the Maine State Chamber of Commerce, which is lobbying state officials to alter some of the rules to make them more business-friendly. Also participating were representatives of Shipyard Brewing, Northern Light Health and Marden’s.

The new program, approved by Maine lawmakers in 2023 and supported by Gov. Janet Mills, imposes a 1% payroll tax, split evenly between workers and employers. The fund created with the payroll tax revenue would be used to pay up to 90% of regular wages for up to 12 weeks for workers who are ill or need to take care of newborns or other family members, among other reasons. Employers with 15 or fewer workers are exempt from paying into the program, but workers at small businesses still will pay a 0.5% payroll tax and will be eligible for benefits.

One of the chamber’s major objections is that while businesses can opt out of the state program if they prove they are providing workers an equivalent benefit, businesses won’t be able to do so opt out until April 2026, 16 months after taxes start being collected. Benefits would start being paid to workers in May 2026.

Moses said the restaurants she co-owns plan to offer their employees a private market paid leave benefit, but the businesses and employees would still have to pay into the state program anyway.

“Our staff and us will be paying into a (state) plan that we will not benefit from,” Moses said.

Paul Bolin, senior vice president at Northern Light Health, said the current rules are “untenable.” He said Northern Light Health, which has hospitals throughout the state, including Eastern Maine Medical Center in Bangor, currently offers a benefit package with paid family leave that surpasses what the state plans to launch, but still will have to pay $1 million per month in payroll taxes for 16 months for a plan it won’t be using.

Not all businesses are critical of the proposed rules. Supporters of the state effort say it’s important for every business and worker to pay into the fund before the actual launch to get the program off the ground.

Gary Friedmann, a partner at Bar Harbor Farm, sees the objections over the long lead-in to benefits becoming available as an excuse by the chamber of commerce “to try to torpedo the plan.”

“It’s completely reasonable. The state needs to build up funds before people can take paid family leave,” said Friedmann, a member of the Maine People’s Alliance, a progressive group that lobbied for the bill. “We wish the benefits would be available sooner, but the state needs cash in the bank to stand up the program.”

Jessica Picard, a spokesperson for the Maine Department of Labor, said that while the department can’t comment on specific objections to the proposed rules during the rulemaking process, the rationale for the time period between when taxes start being collected and benefits paid out is to allow time “to accumulate sufficient funds to pay for benefits and other administrative costs to operate the program. Because benefits will be paid through a dedicated trust fund, the trust fund must be built up and found to be solvent before benefits can go live.”

It’s also too soon to know who is qualified to opt out, supporters say. Standards for private plans as an alternative to the state plan have not yet been finalized, and so there’s no way for the state to determine what would be an equivalent plan, the Maine People’s Alliance said.

But Patrick Woodcock, CEO of the Maine State Chamber of Commerce, said other states that have enacted paid family leave laws, such as New York and Massachusetts, allow businesses offering equivalent private plans to opt out as soon as taxes start being collected.

Business owners expressed other concerns about the new law, including that the rules may be too lax and allow workers to abuse the benefit.

Maine is one of 13 states, plus the District of Columbia, to have enacted paid family and medical leave. The federal government approved an unpaid leave program in the 1990s, allowing workers to take up to three months off without pay.

To comment on the proposed rules, go to www.maine.gov/labor/rulemaking.