Insights

Clarifications to Paid Sick Time Law


In June 2015, Gov. Brown signed SB 454 into law, which made Oregon the fourth state to require paid sick leave for employees beginning Jan. 1, 2016. However, since the law’s inception, there has been some confusion around certain aspects of implementation. Thus, in an effort to address ambiguity, Gov. Brown signed SB 299 into law on June 29, 2017, which makes clarifications and amendments to the paid sick time law.

As background, employers located in Oregon with 10 or more employees (six if located in a city with a population exceeding 500,000 [i.e., Portland]) must provide up to 40 hours of paid sick leave each year. Employers with fewer than 10 employees (six employees if located in a city with population exceeding 500,000) are required to give 40 hours of unpaid protected sick leave to eligible workers. Paid sick leave begins to accrue at a rate of one hour for every 30 hours of actual work. Employees begin accruing sick leave immediately upon hire, although they cannot use the leave time until 91 calendar days after date of hire.

Although not exhaustive, the following are some of the most notable amendments to the state paid sick leave law:

  • Employers may now cap employees’ sick leave bank to 80 hours maximum, and may also limit employees’ accrual to up to only 40 hours of sick time per year.
  • Employers with a current PTO policy that is equivalent or more generous than the minimum requirements must make sure to comply with the state leave requirements for the first 40 hours provided each year, but would not need to comply beyond the first 40 hours provided under the PTO policy.
  • Seasonal farm stands or temporary construction trailers used for office purposes that are located in the Portland area are exempt from the lower employee count (i.e., those located in Portland with six or more employees).
  • When determining the number of employees employed by an employer, certain individuals 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 if these individuals have a substantial ownership interest in the business (i.e., more than 15 percent or a percentage equal to or greater than the average of other owners). These individuals’ family members (spouses, children, parents) may also be excluded.
  • If an employee is paid hourly, weekly, monthly or on a piece-rate basis or commission basis, employers must pay any leave time used at the same rate of the employee’s hourly, weekly or monthly wage or the state minimum wage (whichever is greater).

FAQs intended to assist employers with compliance are now available online. The new amendments are effective as of Jan. 1, 2018. Employers located in Oregon should review their leave policies and ensure they are in line with the new and existing requirements under the state’s paid sick leave law.

Sick Time Law FAQs »
SB 299 »