Oregon Paid Family and Medical Leave Will Raise the Bar

Updated August 16, 2019

Oregon Governor Kate Brown signed a new paid family and medical leave law on August 9, 2019. That makes Oregon the eighth state to mandate paid family leave.

Advocates say House Bill 2005 lays out the most generous, inclusive plan the country’s seen to date. Here’s an overview of what it will mean for workers and employers.

12 Weeks Paid Family and Medical Leave

Oregon’s plan will enable workers to take 12 weeks paid leave to deal with family health issues, their own medical condition or domestic violence issues. Key details:

• Women with complications related to pregnancy may take an extra two weeks leave.
• Workers can take leave for any purpose above, in any combination.
• Employers may permit employees to use paid sick time, vacation leave or any other paid leave earned — in addition to these PFML benefits — to get them up to 100% of their average weekly wage.

New Jersey is the only other state to offer paid leave for victims of domestic violence. But its Family Leave Act applies only to employers with 30 or more employees. Oregon’s law will cover most workers.

100% Wage Replacement for Lower-Wage Workers

In an unprecedented move — Oregon’s law will provide 100% wage replacement for workers who earn 65% or less of the state’s average weekly wage, currently about $1,044. They’ll receive 50% of every dollar they earn above that, up to 120% of the average weekly wage. That would cap benefits at around $1,215 per week.

Oregon’s benefits are even more generous than the recently passed Connecticut legislation that provides 95% wage replacement, capped at $900 a week. That’s an important step, because anything less than 100% of wages can cause financial hardship for low-income workers. We know that half of American workers couldn’t miss more than one paycheck without dipping into savings.¹ And one-quarter don’t even have any emergency savings.²

Most Inclusive Plan to Date

Activists and advocates are celebrating this bill as the most inclusive in the country. Like Oregon’s unemployment insurance, paid family and medical leave insurance will be available to all workers who earn at least $1,000 a year.

Oregon’s law also guarantees that employees’ jobs will be there when they’re ready to return from PFML. Job protection isn’t guaranteed by each of the other states that have passed PFL laws.

Broader Definition of Family Member

Oregon’s definition of a Family Member is also more inclusive than what we’ve seen in other states. It includes:

• Spouse or domestic partner
• Child of covered employee, or the child’s spouse or domestic partner
• Parent of a covered individual or parent’s spouse or domestic partner
• Sibling or stepsibling of a covered individual or the sibling’s or stepsibling’s spouse or domestic partner
• Grandparent of a covered individual or the grandparent’s spouse or domestic partner
• Grandchild of a covered individual or grandchild’s spouse or domestic partner
• Any individual related by blood or affinity whose close association with a covered individual is the equivalent of a family relationship

Building Towards Benefits in 2023

Workers will start receiving paid time off in 2023. That gives the state time to create a system to administer the benefit and to collect payroll taxes to fund it. Contributions to fund the benefit will be split between employees and employers:

• Employees will contribute 60% of the total rate determined by the director, based on annual state wage calculations.
• Payroll deductions will be set at no more than 1%, up to a maximum of $132,000 in wages.
• Employers will contribute 40% of the total rate, but they’ll be exempt if they have less than 25 employees.
• Employers may elect to pay the required employee contributions as an employer-offered benefit.

Employer Plan Option

Employers may apply for approval of an employer-offered benefit plan that provides the same or equivalent benefits as the state bill requires. They may assume all or part of the costs. Employers also have the option to request that employees pay some plan expenses, not to exceed what the bill requires. Employers must:

• Maintain the same records required by the bill
• Provide the same written notice to employees

What’s Next?

Now that Oregon has signed its expansive law, there’s more visibility and momentum than ever for paid family (and medical) leave.

Keep checking back here for the latest developments on this legislation — plus updates on current state programs and any new paid family leave laws.

You can also follow The Standard on Facebook, LinkedIn and Twitter with the hashtag #PaidFamilyLeave.