PORTLAND’S NEW MANDATORY SICK LEAVE LAW



If any of your employees perform work in Portland at any time, they will likely be owed
paid sick leave starting January 1, 2014.

The Problem

At present, no federal employment law requires employers to offer paid sick leave to its employees.  Nevertheless, there is a growing municipal and state trend – recently seen in Seattle, San Francisco, Washington, D.C., and Connecticut – toward requiring such leave.  On March 13, 2013, Portland joined this trend as the City Council unanimously approved an ordinance requiring employers to offer up to 40 hours of sick leave annually to its Portland-based employees (the “Ordinance”).  Similar nation- and Oregon-wide measures were also introduced by lawmakers this year, though neither passed. The Ordinance will become effective on January 1, 2014, and employers must take steps before then to ensure compliance.

Purpose of the New Law

The Ordinance is intended to advance the causes of both workers’ rights and public health.  Supporters of the Ordinance claim it will curb the spread of infectious diseases in the workplace and at schools, allowing sick employees to stay home without penalty, or to stay home with sick children who would otherwise attend school due to lack of home care.  According to the City Council’s findings, “[u]p to 40% of workers in Portland lack even one day of protected sick time they can use to stay home when they or a family member who needs their care is sick. Some employees fear discipline for staying home when sick, even if they are eligible for paid sick time.”  The Ordinance notes that restaurant and child care workers are among the least likely to possess a sick leave benefit, posing a significant health risk to both themselves and others.  The Ordinance also notes that the United States is unique among major industrialized nations in not requiring at least “some form of paid sick time” nationwide.

Covered Employees and Employers

The Ordinance covers all employees (independent contractors are exempted) who work within the Portland city limits (the “City”), regardless of the location of the employer, and regardless of the employee’s part- or full-time status.  Thus even non-Portland employees who make work-related stops in Portland, or employees of a non-Portland employer who telecommute from within the City, are covered by the law for those hours worked in the City.  Eligible employees must work at least 240 hours (i.e., six full-time weeks) during a calendar year, and cannot take leave until 90 days have passed from their date of hire. An employee’s eligibility generally need not be reestablished in subsequent years.

All employers of Portland-based employees must provide protected sick leave to those employees.  Employers already offering sick leave or paid time off (“PTO”) benefits at least equivalent to that required by the Ordinance are not required to offer additional leave.  In addition, unionized employers may negotiate a waiver of rights under the Ordinance if equivalent PTO benefits are included in a collectively bargained agreement.

For employers of at least six (6) total employees, all sick leave must be paid.  Paid leave is paid at the employee’s base rate of hourly pay, disregarding tips or other compensation.

Accrual of Leave

Employees accrue one hour of leave for every 30 hours worked, up to a maximum of 40 accrued per year.  Employees may carry forward a maximum of 40 hours of accrued, unused leave into the next year.  However, employers who choose to “frontload” leave (i.e., offer 40 usable hours at the start of the year, in advance of accrual) are not required to allow carry-over of unused hours into the next year.  Unused, accrued leave need not be paid out upon termination of employment.

Any leave used may run concurrently with any leave required to be offered by an employer under the Oregon Family Leave Act (OFLA) and/or the Family Medical Leave Act (FMLA), as applicable.

Use of Leave

Employees can use up to 40 hours of accrued sick leave during the year.  Leave can be used in one-hour increments on days an employee is scheduled to perform work within the City, and only for the following purposes:

•    Diagnosis, treatment, or care (including preventative care) of either the employee or the employee’s family member;

•    To care for a family member whose “presence in the community jeopardizes the health of others as determined by a lawful public health authority or by a health care provider;”

•    For any work, school, or child-care closure due to a public health emergency;

•    When law requires the Employer to exclude the Employee from the workplace for health reasons; and

•    When taking leave available to victims of domestic violence, harassment, sexual assault or stalking as defined at ORS 659A.272.

Employees taking leave are not required to find a replacement for missed shifts, and may trade shifts with other employees in lieu of using accrued leave.  Employers may require employees to provide reasonable notice of foreseeable absences, pursuant to a written employment policy.  Notice need only be given as soon as practicable in the case of unforseen emergencies.

Employers may require written verification or documentation of the employee’s illness upon use of three consecutive days of sick leave.  However, note that the employer must pay any uninsured costs attendant to any such documentation or verification by the employee.  While an employer may seek verification that the employee was in need of sick leave, the employer may not inquire into the specific nature of the illness, unless otherwise allowed by law.  Any information obtained by the employer shall be kept confidential to the extent provided by law.

Other Employer Requirements

The Ordinance imposes a variety of employee notification and record-keeping requirements on employers, violation of which can result in monetary penalties.  In addition, it is an unlawful employment practice to retaliate in any way against an employee for the use of, or request for, sick leave, or for such use to factor into an “adverse employment action” against the employee.  The Ordinance shall be enforced by the Oregon Bureau of Labor and Industry (BOLI), and employees may file complaints with BOLI for violations of the Ordinance.  Employers must provide all employees with written notice of their rights under the Ordinance, as well as quarterly-notice of accrued and unused leave to each employee.  Written notice, at a minimum, must inform employees of the amount of time available under the Ordinance, the terms of its use, the prohibition on employer retaliation for use of leave, and the employee’s rights to file a complaint for employer violations of the Ordinance.

Preparing for the Ordinance

Employers must determine before January 1, 2014 whether (1) they employ workers covered by the Ordinance and, (2) whether existing sick time or PTO benefits offered by affected employers meet the standards of the Ordinance.  In not, employer policies must be brought up to compliance immediately. Even if an employer currently offers 40 hours of PTO to its employees, changes to existing policies may be necessary.  For instance, “use it or lose it” leave policies forbidding the carry-forward of unused leave into the next year may violate the Ordinance, as will absence-control policies that count sick time among total absences that may lead to disciplinary action.  At a minimum, affected employers will need to adopt written policies regarding “reasonable notice” and informing employees of the proper process for calling in sick.  

Written notice of rights under the Ordinance must be sent out no later than the end of the employer’s first pay period in 2014.  A poster available from the City can be distributed to employees in satisfaction of an employer’s notice obligations.  Additionally, that poster must be posted in a conspicuous place accessible to employees.

If you have any question whether the Ordinance applies to you or your employees, or if you need to bring your business into compliance with the Ordinance, the time to act is now.  We are available to answer questions regarding the Ordinance and your obligations, and to review and revise your current sick leave policies and employee handbooks to ensure your compliance with the Ordinance.

Please do not hesitate to contact any of us if we can be of assistance.

    D. Adam Anderson: Phone - 503-274-1178; email - adama@oandc.com
    Matthew D. Lowe: Phone - 503-274-1165; email - mattl@oandc.com
    Mark P. O’Donnell: Phone - 503-274-1154; email - marko@oandc.com