On January 1, Maine’s minimum wage increased to $12.75 per hour. The increase is the result of a law passed by ballot initiative in 2016 that indexed the minimum wage to the Consumer Price Index for Urban Wage Earners and Clerical Workers for the Northeast Region (CPI).

The increase is determined annually in August by measuring the percent increase in the cost of living from the previous year. The 2022 wage is an increase of 60 cents. Between 2020 and 2021, the minimum wage increased by 15 cents.

The law also increases the minimum wage for tipped workers and affects overtime wages. Tipped workers must now be paid at least $6.38 per hour by their employers. State statute dictates overtime wages must be 1.5 times the hourly rate of pay and be paid for all hours over 40 worked in a week.

There are also exemptions to overtime for salaried workers that are affected by the minimum wage increase. Employers are exempt from overtime requirements if an employee is salaried and their job duties meet certain tests. To qualify for the exemption, the salary exemption was $36,450 prior to the January 1 increase in the minimum wage. Beginning January 1, the new minimum salary threshold is $38,251 per year.

According to small business advocates, with many employers still struggling with the effects of COVID-19 and inflation, the size of this year’s increase may be difficult for some businesses to absorb.

David Clough, the Maine State Director of the National Federation for Independent...

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