The paid family leave and medical bill passed in Oregon this summer will have major implications for employers starting in 2023. Oregon became the eighth state to enact such a measure, and it’s one of the most generous in the nation.
The bill, which Gov. Kate Brown signed into law on Aug. 9, covers nearly every worker in the state. Employees who make more than $1,000 a year will be eligible for 12 weeks of paid leave.
Oregon PFML Specifics
The measure will be funded through payroll contributions by employers with at least 25 workers.
Other details of Oregon’s Paid Family and Medical Leave bill include:
- Guarantees 100 percent of wages to low-income employees (less than about $679 a week)
- Benefits decrease as income level rises
- Funded by employer and employee
- Payroll deductions start Jan. 1, 2022
The time off can be used to:
- Recuperate from a serious health condition
- Bond with a newborn
- Care for a family member with a serious health condition
- Support adopted or foster children within the first year of placement
- Cope with domestic violence, sexual assault or harassment issues
The legislation includes protections in place for workers who use paid family and medical leave.
Other Aspects of Oregon’s PFML
Also of note: Oregon’s PFML broadly defines eligible family member, including step-siblings, a grandparent’s spouse and someone who is the equivalent of a family relationship.
The benefit amount is tied to an employee’s earnings and the state’s average weekly wage (AWW):
- Employees who earn less than 65 percent of state average weekly wage will receive 100 percent of the AWW
- Employees who earn more than 65 percent of state average weekly wage will receive 65 percent of the state AWW, plus 50 percent of the employee’s AWW that exceeds state AWW
- Maximum weekly benefit amount is capped at 120 percent of state average weekly wage: approximately $1,254
- Minimum weekly benefit amount is 5 percent of state AWW: approximately $50
Violating employers can face lawsuits starting in 2025. The state’s Employment Department is expected to issue rules regarding the legislation before September 2021.
“Oregon families no longer need to make the difficult choice between paying the rent and staying home with their newborn, or between chemotherapy and keeping food on the table,” Brown said in a statement. “It’s absurd that our society values someone clocking in and out of their job above holding a loved one’s hand — and that will change under HB 2005, where all families who need and care for each other will be recognized.”
Paid Leave Laws Elsewhere
In addition to Washington, D.C., there are seven other states with paid family and medical leave laws:
- New York
- New Jersey
- Rhode Island
But other states have enacted paid leave laws allowing employees to take time off for any reason:
Meanwhile, cities are enacting their own paid sick leave laws, including three Texas cities (with some legal challenges) and Pittsburgh (courts upheld its legality this summer).
It’s incumbent upon employers to understand the implications of paid leave laws and their impact on compliance and payroll teams.