Oregon Sick Leave: Employer Rx

As predicted, Governor Brown signed SB 454 into law which provides either paid or unpaid sick leave to nearly every employee in Oregon. The Oregon Sick Leave (OSL) law has some specific carve outs for employees who are not affected, such as federal government employees. All other employees must be provided some type of sick leave.


Essentially the Oregon Sick Leave law divides employers into two categories, large and small employers, to determine if an employer has to offer paid sick leave.

  • Large Employers (10 or more employees) – paid sick leave
  • Small Employers (less than 10 employees) – unpaid sick leave

One exception is Portland where the definition of a ‘large’ employer is six or more employees. Oregon Sick Leave is 11 pages long and there are exceptions throughout the law.


Oregon Sick Leave Law Requirements


How does sick leave accrue?

Leave is accrued in one of two ways:

  1. Front Load Method
  • Add 40 hours at the beginning of the benefit year 2016 and you do not have to track the hourly accrual of sick leave.
  1. Hourly Accrual Method
  • Large Employers – Hourly accrual rate is 1 hour of paid sick leave for every 30 hours worked.
  • Small Employers – Hourly accrual rate is 1 hour of unpaid sick leave for every 40 hours worked.


Calendar Milestones – When is leave awarded and renewed?

  1. Front Load Method – Leave is awarded at the beginning of the benefit year. Employees can begin using leave right away. One unanswered question is if they can they call in sick on the first day of work…
  2. Hourly Accrual Method – Leave begins accruing on the date of hire. Employees can start using sick leave on the 91st day.



Employers may cap the accrual of leave at 40 hours per year.


Rollover of Unused Leave

Once again there are two options:

  1. Rollover – Employers can allow the employee to shift 40 hours of unused leave per year to the next benefit year. Rolling over 40 hours of leave means the employer can cap leave at no less than 80 hours per year.
  2. No Rollover – An option with paid sick leave. Large employers may choose to not allow the rollover 40 hours of leave but this requires the employer to pay out any unused sick leave at the end of the year. Large employers will likely not opt to pay out leave as it will probably be more costly.


Sick Leave Balances on Paychecks

Sick leave balances are required on paychecks. Cardinal will be doing this for our clients.


If an employee is rehired within 180 days then the unused prior pool of benefits is restored.


Using Sick Leave

Pretty much anything can be used as a reason to be sick. There are some exceptions and there are times when you can require a doctor’s note. If an employee wants to use sick leave it is best to look over the entire list of acceptable reasons. On pages 5 and 6 of the Oregon Sick Leave law it reviews valid sick leave. You can also discipline employees that “abuse” this policy. An example would be taking sick days before any holiday to extend time off. Once again, review the law before taking action.

If an employee calls in with a questionable sick leave please contact Cardinal for assistance.


Alternatives to a Sick Leave Policy

A Paid Time Off (PTO) or vacation policy that is as generous as the rules under the state sick leave law will be considered in compliance. A likely pitfall is that some vacation policies require advanced scheduling of time off. A PTO or vacation policy must allow the use of unscheduled PTO or vacation time.


Other Sick Leave Laws

Oregon Sick Leave supersedes all local sick leave laws. Portland’s sick leave law is still in effect until the end of the 2015. Eugene’s sick leave law has been rescinded.


The Unknown

The Oregon Bureau of Labor and Industries has been given rule-making authority to implement the law. There will likely be additional regulations and clarifications of Oregon Sick Leave. Cardinal will keep close tabs on this process and keep you informed.


What is Cardinal doing?

  1. Cardinal is rolling out our basic sick leave tracking system this year.
  2. For our TimeTrex users, we will assist you in devising compliant leave policies. More information on this time and attendance option.
  3. Model sick leave policy – Cardinal is busy working on a model sick leave policy that you may adopt. Stay tuned to this newsletter.
  4. Follow Up – As more is learned Cardinal will help determine your liabilities under this law, including helping employers that are close to 10 employees determine their employee count.


Need more help?


Arin J. Carmack