Diversity & Inclusion, HR Management & Compliance

How Oregon’s Workplace Fairness Act Is Impacting Employers

Major elements of the Oregon Workplace Fairness Act (OWFA) went into effect on October 1, 2020. The 2019 Oregon Legislature passed the Act in response to concerns voiced by the #MeToo movement.

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On January 1, 2020, the time to file most discrimination claims under state law with the Oregon Bureau of Labor and Industries (BOLI) or in the courts was extended from 1 year to 5 years. Because the remainder of the law is now in effect, you should review your workplace discrimination and harassment policies, employment agreements, and settlement agreements to ensure compliance.

Review Nondiscrimination and Harassment Policies

Effective October 1, all Oregon employers must have a written harassment and discrimination policy. Most already have a written policy for discrimination prevention that includes procedures for reporting and dealing with discrimination and harassment. Even those with well-developed policies, however, will need to revise them to meet the following additional requirements:

  • Provide a process for reporting prohibited conduct and identify who in the organization is responsible, including at least one alternate, for accepting complaints;
  • Describe the new 5-year statute of limitations;
  • State that the employer cannot require employees to enter into nondisclosure or nondisparagement agreements (and define those terms) that violate the OWFA;
  • Explain that an employee claiming discrimination, harassment, or sexual assault may voluntarily request an agreement that provides for nondisparagement and nondisclosure language, and a no-rehire provision, otherwise prohibited by the OWFA; and
  • Advise employers and employees to document any incidents involving conduct prohibited by Oregon discrimination law.

BOLI has provided a model policy at https://www.oregon.gov/boli/workers/Pages/sexual-harassment.aspx.

The employer’s policy must be made available to every employee in the workplace. Presumably, this can be done through posting or handing out the policy. In addition, all new employees must be given a copy of the policy at the time of hire, and any employee who complains of discrimination, harassment, or sexual assault must be given a copy of the policy.

Review Employment Agreements for Compliance

The OWFA attempts to remedy one of the problems emphasized by the #MeToo movement. Employees who had been subject to harassment or made a harassment claim were silenced in return for a settlement payment, allowing the conduct to continue in the shadows.

The Act says Oregon employers cannot require employees to sign nondisclosure, nondisparagement, or settlement agreements that have the “purpose or effect” of preventing employees from discussing or disclosing discriminatory conduct, including sexual harassment or sexual assault.

Further, settlement agreements cannot have a provision preventing the disclosure of factual information relating to a discrimination, harassment, or sexual assault claim.

The OWFA also limits the use of no-rehire language. Such language, which has been standard in settlement agreements, states the individual signing the agreement cannot apply for rehire. One purpose of the provisions is to prevent a former employee from unsuccessfully seeking rehire and then making a retaliation claim.

There are two exceptions for settlement agreements. First, an employee claiming harassment, discrimination, or sexual assault may ask to have nondisclosure, nondisparagement, and no-rehire language included in an agreement. She has 7 days to rescind the agreement if the language is included, and it doesn’t become effective until the revocation period has expired.

In addition, when an employer makes a good-faith determination that an employee has engaged in discriminatory conduct, harassment, or sexual assault, it may include nondisclosure and nondisparagement language in the settlement agreement to prevent disclosure of factual information relating to the claim along with a no-rehire provision.

Lastly, the limitations on employment agreements aren’t applicable to employees who are tasked by law to receive confidential or privileged reports of discrimination, sexual assault, or harassment.

Voiding of Severance Payments

Finally, the OWFA gives employers the right to void an agreement, such as an executive contract, that provides for payment of severance or separation payments in certain circumstances.

The employer must have conducted a good-faith investigation and concluded the employee violated its written policy on discrimination, harassment, or sexual assault or violated the provisions of the Act relating to employment agreements and that this was a substantial contributing factor to the termination from employment. The employer then has no obligation to make the separation or severance payment.

Cal Keith is a partner with the law firm of Perkins Coie LLP in Portland, Oregon, and can be reached at ckeith@perkinscoie.com.