New Oregon Law Mandates Sick Leave Policy for Most Employers

HIGHLIGHTS:

• New Oregon law establishes policy regarding sick leave. All employers that are subject to these new laws should review their policies to make certain they comply.
• Senate Bill 454 mandates statewide mandatory paid or unpaid sick leave for virtually all Oregon workers and requires most employers to implement the sick leave policy by Jan. 1, 2016. Oregon joins California, Connecticut and Massachusetts in enacting mandatory paid sick leave.

On June 23, 2015, Oregon Gov. Kate Brown signed into law Senate Bill 454, which mandates statewide mandatory paid or unpaid sick leave for virtually all Oregon workers. Oregon joins California, Connecticut and Massachusetts in enacting mandatory paid sick leave.

SB 454 requires nearly all Oregon employers to implement a sick leave policy by Jan. 1, 2016. For employers with 10 or more employees (six or more in Portland), the policy must allow an employee to accrue, earn, use and in some circumstances donate up to 40 hours of paid sick time per year. For employers with fewer than 10 employers (fewer than six in Portland), the policy must allow an employee to accrue, earn, use and in some circumstances donate up to 40 hours of unpaid sick time per year.

The Mandatory Sick Leave Law Applies to Nearly All Oregon Workers

The mandatory sick leave law applies to all state government and private sector full- and part-time workers regardless of whether they are paid on an hourly, salaried, commissioned or piece-rate basis. Those excluded from the law’s application include independent contractors, workers who receive paid sick leave under federal law, participants in work training programs administered under state or federal assistance programs, participants in secondary and post-secondary work-study programs, children employed by their parents, employers covered by a collective bargaining agreement and certain railroad workers.

Sick Leave Accrual, Use and Relation to Paid Time Off Policies

Under the new law, effective on Jan. 1, 2016, existing employees will begin to accrue one hour of sick time for every 30 hours worked. Salaried employees are presumed to work 40 hours per week unless their actual workweek consists of fewer hours. Employees hired after Jan. 1, 2016, begin to accrue sick leave on their first day of employment. An employer’s “paid time off” policy that combines sick and vacation leave may meet the requirements of the accrual portion of the law so long as the employer front loads to employees at least 40 hours of paid time off at the beginning of each eligible accrual year.

All employees are eligible to use their accrued sick leave commencing on their 91st day of employment. Accrued leave may be used in one hour increments. While employees may roll over 40 hours of accrued sick time per year, employers may adopt policies that prohibit accrual of greater than 80 hours of sick time and are not required to pay out accrued sick time at the end of employment. Sick time, however, must be restored to any terminated employee who is rehired by the employer within 180 days. Employees transferred by an employer to another Oregon facility are entitled to retain their accrued sick leave as are employees working for a company that is sold to another employer.

Employee’s Use of Accrued Sick Leave

Accrued sick leave may be used for any of the following purposes, most of which either track or are broader than existing Oregon and federal leave laws.

• Illness or Injury: for an employee’s own or a family member's mental or physical illness, injury or health condition, need for medical diagnosis, care or treatment of a mental or physical illness, injury or health condition or need for preventive medical care
• Bereavement: planning for and attending a family member’s funeral and bereavement
• Safety: to seek legal or law enforcement assistance or remedies to ensure the health and safety of the employee or the employee’s minor child or dependent; and to obtain services from a victim services provider for the eligible employee or the employee’s minor child or dependent and to relocate or take steps to secure an existing home to ensure the health and safety of the eligible employee or the employees minor child or dependent
• Donate: to donate accrued sick time to another employee if the employer has such a policy in place

The new law contains a broad definition of “family member” that includes the employee’s spouse, children, parents, parents-in-law, grandparents, grandchildren and registered same-sex domestic partners. 

The law specifically prohibits employers from requiring sick workers to search for or find a replacement worker as a condition of the employee’s use of accrued sick time or to work an alternate shift to make up for the use of sick time.

If an employee takes more than three consecutive scheduled workdays of sick time, an employer may require the employee, at the employer’s sole cost, to provide verification from a healthcare provider of the need for the sick time.

Additional Important Provisions of the Sick Leave Law

• Rate of pay: Employees must be paid for used sick time at their regular rate of pay. Commissioned and piece-rate employees without an established regular rate of pay must be paid no less than minimum wage for sick time used.
• Notice requirements: Employers must provide employees with at least quarterly notice of the amount of their accrued and unused sick time and must provide all employees with information about the law’s benefits and requirements.
• Enforcement: The new law prohibits retaliation against an employee who invokes its protections and provides for the state's Bureau of Labor and Industries (BOLI) enforcement and authority to impose civil penalties as well as a private right of action against the employer for damages, penalties and attorneys' fees.

Employers' Next Steps

All employers that are subject to this new law should review their existing sick leave policies, payroll reporting procedures, employee handbooks, and other relevant policies and procedures to update them to ensure that they are compliant with Oregon law.

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem. Moreover, the laws of each jurisdiction are different and are constantly changing. If you have specific questions regarding a particular fact situation, we urge you to consult competent legal counsel.