As we head towards the end of 2022, it is time to begin preparing our businesses (and ourselves) for what is to come in 2023. Employers must know any new legislative compliance challenges that are ahead. One of the changes that Maine businesses need to be aware of is the new state and local minimum wages. Let’s take a look at Maine’s minimum wage increase for 2023.

When will Maine’s minimum wage increase?

Due to legislation passed in 2016, Maine’s minimum wage must increase to keep up with the cost of living. Each year, the new minimum wage will take effect on January 1st. All employees must be paid at least the new minimum wage on the first pay date in January, regardless of what pay period you are paying out, for your business to maintain compliance.

How much will the minimum wage increase?

The consumer price index adjust calls for an increase in minimum wage of 8.2% over the current rate of $12.75 per hour. This means that the new minimum wage in Maine starting on January 1st, 2023 will be $13.80 per hour. Again, employees must be paid at least this amount on the first pay date in January, regardless of what pay period you are paying out.

For those businesses with tipped employees, the minimum wage for those tipped employees will increase to $6.90 per hour. The federal tip credit allows employers that have tipped workers to pay a much lower percent, 50% in Maine, of minimum wage in direct wages to its’ tipped employees.

Additionally, the minimum salary level in Maine will increase. The new salary threshold will be $796.17 per week, or a total of $41,401 per year.

Finally, for those business that operate in the city of Portland, the minimum wage will increase to $14.00 per hour. For tipped employees in Portland, the minimum wage will be $7.00 per hour.