Oregon Clarifies Paid Sick Leave Law

Oregon Governor Kate Brown recently signed Senate Bill 299 into law, which makes some clarifications and changes to Oregon’s Paid Sick Time law, which took effect on January 1, 2016. 

Foremost among the changes was the addition of language in the statute that permits employers to limit the accrual of paid or unpaid sick time of their employees to 40 hours per year. Previously, the statute only allowed employers to limit to 40 hours carryover of sick hours from one year to the next, but was ambiguous as to whether employers could otherwise limit sick time accrual within a single year.  This change brings greater clarity to the law and its application for employers following the “accrual” method of calculating time for their employees.  Employees are still capable of having a maximum bank of 80 hours if they have 40 hours of carryover from a prior year, and 40 hours accrued within the current year.

The amendments provide that employers with a sick leave, vacation policy, personal or other paid time off policy that is substantially equivalent to or more generous to employees than the paid sick leave law’s minimum requirements must comply with the law’s requirements for the first 40 hours that the policy provides per year, but need not comply with the law’s requirements beyond the first 40 hours that the policy provides per year.

Before the amendments, leave for piece workers and/or commissioned employees was paid at the employee’s regular rate of pay or, if the employee did not have a previously established regular rate of pay, the minimum wage. After the amendments, in addition to the above option, if an employee is paid an hourly, weekly or monthly wage and on a piece-rate or a commission basis, leave is paid at a rate equivalent to the employee’s hourly, weekly or monthly wage or the minimum wage, whichever is greater.

Under the law, employers must provide paid – instead of unpaid – sick leave if they either: 1) employ at least 10 employees working anywhere in Oregon; or 2) employ an average of at least six employees per day in Oregon and maintain a location in a city in Oregon with a population exceeding 500,000 for each workday during the 20 workweeks of operation (i.e., Portland). The amendments clarify that seasonal farm stands or temporary construction offices located in the Portland area are not subject to the lower employee count. 

Finally, the amendments provide that certain persons associated with employers need not be included in the employee count. These individuals include directors of a corporation, members of an LLC, partners of an LLP, and sole proprietors, when those people have a substantial ownership interest in the operation (more than 15% and not less than the average of other owners).  Members of the immediate families (child, spouses, and parents) of these people may also be excluded. 

The amendments to Oregon's Paid Sick Time law were enacted on July 1, 2017 and will take effect on January 1, 2018. 

Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.