Many employers have questions about what mandatory sick leave means for their company. Take a look at the top 7 questions Oregon employers are asking.
Oregon recently joined a handful of other states across the nation to require employers to offer sick leave for their workers. In general, if you have at least 10 employees in Oregon, you must provide 40 hours of paid sick leave per year; smaller employers are still required to provide the same amount of sick leave, but the time off can be unpaid. However if the employer has a location in Portland, then the threshold for leave to be paid is 6 or more employees in the state of Oregon. Although the new law (SB 454) doesn’t take effect until January 1, 2016, the financial and practical impact of complying with the law takes some time to work through. Employers should be evaluating their options now and planning how to revise their policies.
Many employers have questions about what mandatory sick leave means for their company. Take a look at the top 7 questions Oregon employers are asking.
1. Does the law apply to employers with 10 or more employees in Oregon or 10 or more employees total with any number of employees in Oregon?
The law applies to all employers in the state of Oregon, but whether the leave needs to be paid depends on whether the employer has at least 10 employees in the state of Oregon. If an employer has at least 10 employees working anywhere in the state of Oregon, sick leave must be paid. If the employer has fewer than 10 employees working anywhere in the state of Oregon, the sick leave is unpaid. (Note: If the employer has a location in Portland, then the threshold for leave to be paid is 6 or more employees in the state of Oregon.)
2. We offer paid leave through a Paid Time Off (PTO) or Vacation Policy. Does that meet the requirements of the new law?
An employer can use a PTO or Vacation Policy to comply with the new law, but most policies require some adjustment in order to meet the required standards. For example, many employers already offer 40 hours of paid leave in a year, but their policy fails to meet some of the other minimum requirements of the law (e.g. reasons for using leave, accrual rate, eligibility requirements, yearly carryover, etc.). If you want to use an existing PTO or Vacation Policy to comply with the law, you should have an attorney do a careful review to make sure the policy is in full compliance.
3. If our PTO policy allows employees to use time off for any reason (e.g. vacation, illness, emergencies, etc.) and an employee chooses to use all of their time for vacation, do we have to provide more sick leave?
No, your obligation is to provide 40 hours per year that could be used for Oregon sick leave purposes. If an employee chooses to use it all for a reason other than sickness, they are not entitled to any further paid time off.
4. Our business is seasonal and, during our busy season, we employ a lot of temporary, on-call and part-time employees. Do these employees qualify for Oregon sick leave?
Yes. All employees are entitled to earn sick leave at the rate specified in the law. However, the law also states that employees aren’t entitled to start using sick leave until they have worked for the company for 90 calendar days. Seasonal or temporary workers may not be employed with you for 90 days, so it’s possible that they will earn sick leave but will not work for you long enough to actually use it.
5. Can an employer determine the 12-month period for offering sick leave or is it based on a calendar year?
An employer is given several options for establishing the sick leave year, provided it is a set 12-month period (no rolling leave year options). The statute provides the following examples for establishing the leave year: calendar year, tax year, fiscal year, contract year, or the 12-month period starting on the anniversary date of employment for the employee.
6. We currently offer sick leave, but ask employees to bring a doctor’s note when they pre-schedule their sick time, to show they actually went for a medical reason. Is that going to be problematic under the new law?
Possibly. The new law states that an employer can require medical verification if the absence is expected to exceed three days or there is a pattern of abusing sick leave. If an employee pre-schedules sick leave and the expected duration of the leave will be less than three days, then you cannot require medical verification. Keep in mind that an employer is required to pay for the cost of the medical verification, plus the cost of any lost wages, for any medical verification that is required. This requirement to pay may impact your policy of requiring a doctor’s note for all sick leave occurrences.
7. Other than our Sick/PTO/Vacation Policy, what other policies may be affected by this new law?
While this law appears to impact only paid leave policies, there are many other company policies that could conflict with the rights provided by the new law. For example, most attendance and call-in policies require some revision to allow for unexpected absences that can occur when an employee uses sick leave. Also, many companies don’t allow part-time or temporary employees to earn benefits, so they will need to redefine what rights each employee is entitled to receive. Finally, reasons that an employee can use sick leave can have an impact on an employer’s Oregon Family Leave Act (OFLA) Policy, Domestic Violence Leave Policy and Bereavement Leave Policy. Now is probably a good time to do a complete handbook review to make sure that all of your policies align with the new law.
These questions are just the beginning and many employers still have misconceptions about what they’ll need to do in order to comply with the new law. We are finding that employers have a number of significant decisions to make in deciding how to design and implement their sick leave (and other) policies. Oregon employers should consult with their legal counsel now, because the January 1, 2016, effective date will be here all too soon.
Diane Buisman is an employment attorney & regional director at Vigilant.
