Payroll and Benefits Guide - United States - Maryland

United-States-Maryland
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Currency

United States Dollar
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Capital

Annapolis
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Employer Taxes

11.55% – 26.75%

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Date Format

mm/dd/yyyy
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Fiscal Year

1 Jan – 31 Dec

Fun Facts

The state is nicknamed “The Old Line State,” a reference to the Maryland Line, a group of soldiers who fought courageously during the American Revolutionary War.

Maryland is the birthplace of the American national anthem. The Star-Spangled Banner was written by Francis Scott Key during the bombardment of Fort McHenry in Baltimore in 1814.

The state is home to the United States Naval Academy, located in Annapolis, which has been training Navy and Marine Corps officers since 1845.

Maryland is known for its blue crabs, and crab feasts are a popular tradition in the state.

The Maryland state sport is jousting, making it the only U.S. state to have an official sport.

The first dental school in the world, the Baltimore College of Dental Surgery, was established in Maryland in 1840.

United-States-Maryland

Contributions

Employee Payroll Tax

Contribution TypeRate
FICA Social Security6.20%
FICA Medicare1.45%
Additional tax0.90%

Employer Payroll Tax

Contribution TypeRate
Unemployment Insurance2.2% – 13.5%
Unemployment- New Employer2.6%
FICA Social Security6.20%
FICA Medicare1.45%
The FUTA0.60% – 6.00%

Payroll

Payroll Cycle

Typically, workers in Maryland are paid twice a month, following specific dates specified in their contract or as predetermined.

13th Salary

There are no laws requiring 13th salary.

Work Hours and Week

The average workweek consists of 40 hours, or 8 hours per day from Mondays to Fridays.

Overtime

In Maryland, the Fair Labour Standards Act (FLSA) is followed, and any work exceeding 40 hours per week is considered overtime, compensated at 150% of the usual pay rate. When employees are already scheduled to work on weekends or rest days, no extra payment is necessary.

Nevertheless, if an employer asks an employee to work on these days due to exceptional circumstances, then overtime will be paid at the rate of 150% of their regular pay.

United-States-Maryland

Leave

Paid Time Off

In Maryland, there are no specific state laws regulating the quantity and remuneration of vacation time. Instead, it is customary for employers to determine whether to provide paid or unpaid vacation leave, adhering to employment laws and including it in the employment contract or collective bargaining agreement.

Public Holidays

There are 15 recognized holidays, but private employers are not obligated to offer time off or pay overtime rates for work performed on these days.

Sick Days

Many employers typically adhere to the guidelines of the Family and Medical Leave Act (FMLA), which grants eligible employees up to 12 weeks of unpaid, job-protected leave annually for specific family and medical reasons, such as maternity leave, serious health conditions, or caring for a spouse or child.

Furthermore, in Maryland, companies with a workforce of 15 or more employees, who have rendered 106 days of service to the company or have worked over 12 hours per week, are eligible for one hour of paid leave for every 30 hours worked, with a maximum of 40 hours of paid sick leave annually.

Maternity & Paternity Leave

FMLA-eligible employees have the right to:

  1. Take up to 12 working weeks of leave within a year for the birth of their child and to care for the newborn within one year of birth.
  2. Request leave for the adoption or foster care of a child and to care for the newly placed child within one year of placement.
  3. Attend to the needs of their spouse, child, or parent with a severe health condition.
  4. Take leave if they have a serious health condition that hinders them from performing their job’s essential functions.
  5. Request leave for any qualifying exigency arising from their spouse, son, daughter, or parent being a covered military member on “covered active duty.”

Other Leave

Under Maryland law, all employers are mandated to offer their full-time employees job-protected leave without pay when they are serving on jury duty or acting as a witness in a case, responding to a subpoena, or participating as a plaintiff or defendant in court proceedings. Employees must provide their employers with a copy of the jury summons as evidence of the requirement.

In addition to the federal law known as USERRA (Uniformed Services Employment and Reemployment Rights Act), Maryland law extends protection against discrimination to members of the U.S. armed forces, reserves, National Guard, commissioned corps of the Public Health Service, and other categories of individuals designated by the president during times of war or emergency.

Furthermore, Maryland law stipulates that all employees registered to vote must be granted up to two hours of paid leave to vote in any municipal, county, state, or federal primary or general election. Employees are required to provide reasonable notice to their employers if they intend to take time off to vote.

Termination

Termination Process

With the exception of mass dismissals or as outlined in an employment contract or collective bargaining agreement, U.S. law does not require a formal “notice period” for terminating an employment contract, and employment is considered “at will.”

This means that either the employer or the employee can terminate the employment relationship without the need for advance notice or a specific reason, as long as it is not illegal or based on discriminatory grounds protected by law, as specified in the Federal Worker Adjustment and Retraining Notification Act (WARN).

Employment contracts for executives and other highly skilled individuals frequently include a “just cause termination” clause, which mandates that the employer can only terminate the employee for specific “cause” reasons listed in the contract. In such instances, the parties negotiate the acceptable grounds for a “just cause” termination on a case-by-case basis.

Notice Period

In Maryland, the majority of employees are considered “at-will,” which means that either the employer or the employee can end the employment relationship without prior notice. It is not mandatory by law in Oregon for employers to provide payment for unused vacation time upon termination.

Severance Pay

Unless stated otherwise in an employment contract or collective bargaining agreement, employers are not obligated to provide severance payments to terminated employees. If employers opt to offer severance pay, it should be clearly specified in the employee’s contract and agreed upon by both parties.

Numerous employers choose to offer severance payments based on the employee’s tenure, often following the practice of providing one week’s pay for each year of service.

Probation Period

Probation Period

There is no specific legal requirement for a formal “trial/probation period” in Maryland. However, it is a common practice among employers to conduct a performance evaluation after an initially agreed-upon period of employment, typically lasting 90 days.

Immigration

Foreign nationals who do not possess permanent resident status or a work visa are not permitted to work in the United States. To hire a foreign national, an employer can submit a petition to the United States Department of Homeland Security/United States Citizenship and Immigration Services (USCIS) to obtain an employment visa on behalf of the prospective employee.

Once the petition is approved, the prospective employee must obtain a “visa stamp” from a U.S. embassy or consulate, except for Canadian citizens who are exempt from this requirement. In order to secure a temporary U.S. work visa, the employer must file a petition with USCIS, and an approved petition is a necessary component of the visa application process.

VAT

In Maryland, there is a uniform sales tax rate of 6.00%.