Paid Leave Oregon (PLO) is a groundbreaking leave law that took effect on January 1st, 2023, that applies to all Oregon employers, regardless of size. The law grants eligible employees up to 12 weeks of paid time off, enabling them to tend to their health needs, care for family members, bonding with a child, or take safety leave for themselves or a family member who is a victim of sexual assault, domestic violence, harassment, or stalking. Employees can begin taking leave on September 3rd, 2023. Unlike traditional leave regulations, a state-paid leave fund has been established to cover wage replacement benefits. It’s crucial, however, for employers to understand the intricacies of the law and how it intersects with other leave regulations to ensure seamless compliance. This article serves as a guide for Oregon employers with key takeaways for understanding and applying this law.
Essential considerations for employers
There are several important takeaways for employers to consider when complying with Paid Leave Oregon:
Contribution rates and payroll requirements:
Employers need to be aware of the contribution rates associated with PLO. Currently set at 1% of an employee’s gross earnings per pay period, this contribution is limited to a maximum of $132,900 annually for 2023. The split of this contribution varies based on the size of the business. While the employee contributes 60%, the employer (or the State of Oregon, for smaller businesses) covers the remaining 40%. Accurate payroll deductions and reporting are crucial for compliance. While payroll deductions and reporting are the employer’s responsibility, leave taken under Paid Leave Oregon is managed and paid directly by the state of Oregon unless the employer files for and receives approval from the state for an Employer Equivalent Plan.
To qualify for benefits under PLO, employees must have earned at least $1,000 in the preceding calendar year. The law covers a broad spectrum of employment types, including full-time, part-time, and seasonal workers. It’s important to note that self-employed individuals and independent contractors can opt into the program. In addition to the eligibility criteria above, employees must:
- Provide their employer with 30 calendar days’ notice for foreseeable events
- Provide notice to their employer within 24 hours of an unforeseen or emergency event.
- Follow up with a written notice for unforeseen events within three days of starting leave. Otherwise, failure to do so may reduce the first weekly benefit amount by 25%.
Benefits and qualifying events:
Approved employees are eligible for up to 12 weeks of paid leave, with a potential extension to 14 weeks in certain pregnancy-related situations. The compensation is a percentage of the employee’s prior year’s wages, with a weekly minimum of $63.48 and a maximum of 1,523.63.
Qualifying events include:
- The birth of a child
- Bonding with a child in the first year after birth, after adoption, or when placed through foster care
- Caring for yourself or a family member with a serious illness or injury
- Leave related to yourself or a child who is a survivor of sexual assault, domestic violence, harassment, or stalking
What is a serious health condition?
A serious health condition is an illness, injury, or physical or mental condition that:
- Requires inpatient care
- Poses an imminent danger of death or possibility of death in the near future
- Requires constant or continuing care
- Involves a period of incapacity
- Involves multiple treatments
- Involves a period of disability due to pregnancy
What is a family member?
- Your spouse or domestic partner
- Your child (biological, adopted, stepchild, or foster child), your spouse or domestic partner’s child, or the child’s spouse or domestic partner
- Your parent (biological, adoptive, stepparent, foster parent, or legal guardian), the parent of your spouse or domestic partner, or your parent’s spouse or domestic partner
- Your sibling or stepsibling or their spouse or domestic partner
- Your grandparent or your grandparent’s spouse or domestic partner
- Your grandchild or your grandchild’s spouse or domestic partner
- Anyone you are related to by blood
- Anyone who is connected to you and has a family relationship
PLO guarantees job protection for employees who have been employed for over 90 days. This includes restoration of their position upon returning from leave.
Employers who offer benefit plans that match or exceed the benefits provided by PLO may apply for equivalent plan status. This exempts them from participating in the state program.
Navigating compliance and implementation
Compliance with PLO requires meticulous attention to detail. Employers must:
- Post notice provided by PLO detailing employees’ rights to file a claim.
- Grant approved employees the time off and job protection they are entitled to under the law.
- Ensure accurate collection and remittance of both employer and employee contributions to the state.
- Track leave using a rolling forward method for all employee leave covered under PLO
- Report total employee counts and contributions to the relevant authorities.
Convergence of laws: PLO, FMLA, and OFLA
PLO operates in tandem with existing leave laws, particularly the Oregon Family Leave Act (OFLA), the Oregon sick time law, and the federal Family Medical Leave Act (FMLA). Employers should take the time to understand each of these regulations and how they intersect.
Key considerations regarding the intersection of these leave laws:
Differences in the laws:
Where the laws differ, the employer is legally required to apply the standards most beneficial to the employee.
Overlapping qualifying reasons:
In most cases, PLO, OFLA, and FMLA are calculated concurrently unless eligibility requirements or qualifying reasons differ. This means leave taken is deducted from the available leave balance for each law. Note: It’s crucial to follow each law’s required notification and reporting rules carefully. Not doing so might enable the employee to take additional leave for the same event under different laws.
Unique qualifying reasons:
Leave taken for qualifying reasons unique to any of the laws does not count against the balance of leave for the other regulations. For example, an employee who has exhausted their FMLA leave for a military exigency can take leave under PLO for a pregnancy.
For a new employee, any leave taken during the eligibility gaps between the PLO 90 days, OFLA 180 days, and FMLA 365 days does not reduce eligibility for the other leave entitlements. Consider the following example:
- A new employee is eligible for 12 weeks of leave under PLO after 90 days.
- An employee who takes that time still becomes eligible for leave under OFLA after 180 days for the same event.
- An employee who has taken both PLO and OFLA leave still becomes eligible for FMLA leave after 12 months for the same event.
- If the employee takes leave under PLO, OFLA, and FMLA, the employer will potentially be tracking three separate leave years until a period of 12 months has passed in which the employee has not taken leave.
Additionally, Oregon Senate Bill 999 requires employers to adopt the forward-looking or rolling forward method for tracking the 12-month leave period under OFLA and PLO, beginning July 1, 2024. It is important to note that employers must give 60 days advance notice if they decide to change their leave tracking method and ensure that employees do not lose any benefits as a result of the transition.
PLO represents a significant step towards supporting employees’ well-being and family responsibilities. By understanding the law’s nuances and complying with its requirements, businesses can navigate this new landscape effectively. With the right approach, employers can not only fulfill their legal obligations but also foster a workplace culture that prioritizes the health and happiness of their workforce.