HR Management & Compliance

Compromise Bill Bringing Paid Family Leave to Oregon

Oregon is joining the ranks of states with a paid family leave law. During its recent session, the state legislature passed a compromise bill similar to the law in neighboring Washington.

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Oregon’s law, which won’t go into full effect until January 2023, differs from more aggressive bills that were also proposed. House Bill 2005B is the result of much negotiation and was passed amid threats to take a more aggressive bill to a statewide vote.

Under Oregon’s new law, covered employees will be provided up to 12 weeks of paid family leave each year. For pregnancy and childbirth, an additional two weeks of paid family leave will be available. The paid family leave is in addition to the paid sick time already required by law. Employees can be paid 100% wage replacement all the way up to 120% in certain circumstances.

The paid family leave is available to all employees who have earned more than $1,000 in the previous year and have contributed to the benefit fund or are under a private plan.

Leave will be paid through a combination of employer and employee contributions via a payroll tax to be set at not more than 1%. Employees will pay 60% of the tax, and employers with more than 25 employees will pay 40%. Smaller employers have no mandatory contribution but may voluntarily contribute.

Calvin L. Keith, an attorney with Perkins Coie LLP in Portland, Oregon, can be reached at ckeith@perkinscoie.com. More information about the new law will be provided in future issues of Oregon Employment Law Letter.