Governor Kotek signed Oregon Senate Bill 999 into law on June 7, 2023, which amends the Oregon Family Leave Act (OFLA) and Paid Leave Oregon (ORS Chapter 657B) and incorporates changes intended to better align the laws in both language and function. As we noted last month, the start date for leave benefits under Paid Leave Oregon is still targeted for the beginning of September, and employers will need to make most of the changes in the amendment by that date. Recognizing that employers currently use a different definition for OFLA’s “benefit year,” and that the transition will take time and effort (proper notice, internal policy updates, system updates, etc.), employers have until July 1, 2024, to transition to the new definition of “benefit year” under OFLA.
Employers with employees in Oregon should take note of key “fixes” to the laws summarized below, review their leave policies and practices to determine whether necessary revisions may be needed, and be sure to take the necessary steps to come into compliance by the deadlines to do so.
OFLA and Paid Leave Oregon Must Be Taken Concurrently
The amendment added language to prevent leave “stacking” under OFLA and Paid Leave Oregon. It does so by inserting a provision into OFLA under which leave taken for purposes of OFLA draws down the allotments of available leave concurrently. If family leave taken under OFLA also qualifies as protected leave pursuant to the Family and Medical Leave Act (FMLA) or Paid Leave Oregon, then the OFLA leave must be taken concurrently with the FMLA and Paid Leave Oregon leaves—not in addition to. This does not change any of the leave allowances provided under the respective laws but clarifies that they cannot be stacked.
Oregon employers who also have employees in Washington should note that this is different than Washington Paid Family and Medical Leave law, which expressly prohibits an employer from requiring an employee take state leave concurrently with FMLA.
Employers Now Have Two Options for Defining the Applicable OFLA Leave Year
The OFLA benefit year was previously defined to mirror FMLA, which allowed employers three options to calculate the benefit year (rolling forward, rolling backward, or 12-month consecutive year). Paid Leave Oregon, on the other hand, uses a different leave year that is the 52-week period commencing on the Sunday before the first day of covered leave. Under this amendment, OFLA-covered employers have only two options: they must change their OFLA leave year to (1) the same 52-week look forward method that is used by Paid Leave Oregon or (2) another consecutive 12-month period, such as calendar year, fiscal year, or the 12-month period that begins on the date an employee commences family leave.
The change is not required until July 1, 2024, but employers who switch to the look-forward method may consider doing so by September 3, 2023, when Paid Leave Oregon benefits become available. Employers who choose also to change their FMLA benefit year should be mindful of notice requirements to do so.
OFLA’s Definition of “Family” Now Mirrors the Expanded Definition Used by Paid Leave Oregon
With the goal of creating alignment between Paid Leave Oregon and OFLA, the amendment expands the definition of “family” in OFLA to that used in Paid Leave Oregon. By extension, this modifies the definition of family used in Oregon’s sick time law because that law is tied to OFLA definitions. Specifically, the expansion to OFLA includes relationship by blood or affinity; siblings, stepsiblings, and the spouse or domestic partner thereof; and the spouse or domestic partner of your child/stepchild, grandparent, or grandchild.
The amendment also includes in the definition of family “any individual related by blood or affinity whose close association with a covered individual is the equivalent of a family relationship” (emphasis added). It also directs state administrative agencies to adopt rules establishing factors to clarify what “affinity” means and provides that such rules may include rules for developing and using an attestation form by which an employee would attest to the yet-to-be-identified affinity factors.
The Geographic Range for Consideration of Whether an Equivalent Job Is Available for Purposes of Reinstatement Following Leave Is Expanded to a 50-Mile Radius
As part of the job protection components, Paid Leave Oregon and OFLA contain certain provisions requiring the offer of an equivalent position when an employee returns from leave, but whose original job is no longer available at the same job site. OFLA requires employers to restore the employee to any available equivalent position with equivalent employment benefits, pay, and other terms and conditions of employment, and it currently requires that if an equivalent position is not available at the employee’s original job site, that the employee be offered an equivalent position at a job site that is within 20 miles. The amendment increases this range to 50 miles, stipulates that the employee must first be offered the position at the job site nearest the original job site if multiple positions are available, and clarifies that the obligation of equivalent positions is dependent on a job being available.
Employers May Automatically Deduct the Employee Portion of Health Insurance Premiums, within Certain Limits
The new law also carried over OFLA’s provisions regarding the recovery of contribution amounts advanced by the employer into Paid Leave Oregon. It makes clear that while employers must maintain any health care benefits for employees on leave, the employee must continue to make their regular contributions. It also clarifies when and how the employer can collect those amounts, and caps deductions for repayment of any advanced premiums paid on the employee’s behalf during a leave at 10 percent of the employee’s gross pay each period. Employers should proceed with caution when deducting amounts from employee’s paychecks under this section to ensure strict compliance and should consider reaching out to counsel for support in doing so.
Employers with any employees in Oregon need to review and update their leave policies for compliance with these changes and new requirements, preferably sooner than later, given that Paid Leave Oregon’s leave benefits are currently scheduled to start in September (unless it is delayed again). Employers should be particularly aware of, and thoughtful about, implementing any changes to their benefit year so that they meet any notice requirements to do so, and so that they don’t impact those employees who are currently on leave, or in any way shorten the leave available to an employee while making the change. While the amendment is intended to streamline and align the laws, it nonetheless raises additional issues for which Oregon employers should be aware. Stay tuned for additional blog entries on this topic.
Additional information about Paid Leave Oregon, including helpful resources for employers, may be found here.
As always, we invite you to reach out to the Miller Nash team of employment attorneys if you have questions about the amendment or if you need support in navigating and implementing these changes.
The legal issues impacting this topic are and will continue to be ever-changing (Employment Law in Motion!), and since publication of this blog post, new or additional information not referenced in this blog post may be available.
This article is provided for informational purposes only—it does not constitute legal advice and does not create an attorney-client relationship between the firm and the reader. Readers should consult legal counsel before taking action relating to the subject matter of this article.