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Employment Alert - 
Oregon and Washington Legislative Update
February 6, 2020
 
2020 is upon us and keeping us on our toes as employers. Both Oregon and Washington employers need to take steps to comply with new employment laws.  Below is a summary of new laws introduced by the states of Oregon and Washington.

This newsletter includes only brief summaries prepared by FWW employment law attorneys Kelly Tilden, Trish Walsh and Jon Himes.

Please contact Kelly Tilden , Kim McGair, 
Trish Walsh or Jon Himes  to advise on compliance and best practices .

OREGONOregon

Pay Equity Amendments (SB 123)ORPayEquity  

The 2019 Legislature amended the Oregon Equal Pay Act of 2017 in several ways. First, the amendments make clear that an employer may pay employees for work of comparable character at different compensation levels on the basis of one or more of the factors listed in the statute that are contained in a collective bargaining agreement for unionized employees. Second, the amendments allow employers to pay a different level of compensation to an employee who receives wages for modified work under certain circumstances. Third, the amendments change the equal pay analysis requirements.  Under the amended law, an employer may be able to avoid an award of compensatory and punitive damages in a lawsuit alleging a violation of the Equal Pay Act if the employer demonstrates that it (1) completed, within three years before the action, an equal pay analysis in good faith that was reasonable in light of the size of the employer, and that included a review of practices designed to eliminate unlawful wage differentials (the old language required that the analysis instead be "related to the protected class asserted by the plaintiff"), and (2) has made reasonable and substantial progress toward eliminating the unlawful wage differentials for the employer's employees (not just for the protected class asserted by the plaintiff, as previously required). 
Workplace Harassment and Discrimination and Sexual Assault Disclosure (SB 726)ORHarassmentDiscrimination

While most businesses have a written harassment policy, having a written policy is now required by Oregon law.  The policy must provide notice of certain terms.  At a minimum, the policies must include:
  • A process for employees to report prohibited conduct;
  • The identity of the person tasked with receiving reports, including an individual designated as an alternate to receive such reports;
  • A description of the applicable statute of limitations; and
  • The prohibition regarding NDAs and its exceptions.
In addition, it is now an unlawful employment practice for an employer to enter into an agreement that prevents an employee or prospective employee from disclosing sexual assault or other unlawful discrimination, subject to certain exceptions. Further, the statute of limitations for filing a BOLI complaint or a civil action alleging discrimination has been extended to five years after the occurrence of the alleged unlawful employment practice.  The remedy can include recovery of back pay for the prior two-year period as well as compensatory and punitive damages.
Reasonable Accommodation for Pregnancy-Related Conditions (HB 2341)ORPregnancy

In recognition of the demographics of our workforce, Oregon has expanded employee protections related to pregnancy and childbirth (including related medical conditions). While Oregon has long prohibited discrimination against pregnant employees, the law now recognizes the need to accommodate medical conditions related to pregnancy and childbirth. The new law, effective January 1, 2020, essentially parallels the laws governing disability accommodations and gathers the rules regarding pregnancy and childbirth accommodations in one place.
 
Businesses with six or more employees will need to provide reasonable accommodations for employees with pregnancy related conditions. Such accommodations are often common sense and can include more frequent or longer break periods or rest; ability to have beverages at a work station; or assistance with manual labor. In addition, businesses may need to consider more complex accommodations depending on the employee's need. With medical verification, the employee may qualify for modification of work schedules or job assignments; or modification of equipment or devices used.
 
The law also makes it unlawful for employers to:
  • Deny employment opportunities to an applicant or employee based on the need to make reasonable accommodation to the known limitations relating to pregnancy, childbirth or a related medical condition, including but not limited to lactation;
  • Fail or refuse to make reasonable accommodation to these known limitations, unless the accommodation would impose an undue hardship;
  • Take an adverse employment action or in any manner discriminate or retaliate against an applicant or an employee, with respect to hire or tenure, or any other term or condition of employment, because the applicant or employee has inquired about, requested or used a reasonable accommodation;
  • Require an applicant or an employee to accept a reasonable accommodation that is unnecessary to perform the essential duties of the job or to accept a reasonable accommodation if the applicant or employee does not have a known limitation; or
  • Require an employee to take family leave, or any other leave, if the employer can make reasonable accommodation to the known limitations. 
A reasonable accommodation may become unreasonable if it would cause the employer an undue hardship, or in other words, something that is significantly difficult or expensive in relation to the size of the employer. This is not a bright-line test. Contact us for help navigating these and other accommodation-related issues.
Expression of Breast Milk in the Workplace   (HB 2593) ExpressionofBreastmilk

Oregon has expanded the protections for employees who take lactation breaks.  Specifically, employers must now provide employees with reasonable rest periods to express milk each time the employee has a need to do so, if the employee is expressing milk for a child 18 months or younger. (Small employers with 10 or fewer employees may be excepted if it would impose an undue hardship.) Previously, such breaks were required to take place during scheduled rest periods; the new law provides more flexibility.  When possible, an employee is required provide reasonable notice to the employer that the employee intends to express milk upon returning to work after the child's birth--however, the statute makes clear that failure to give such notice is not grounds for discipline.
WASHINGTONWashington

Amendment to Washington's Equal Pay and Opportunities Act (EPOA) - 
Effective July 28, 2019WAEqualPay

While the Equal Pay and Opportunities Act (EPOA) already prohibited businesses from using wage or salary history when making job offers to applicants, the legislature amended the act to further ensure gender equality in the workplace.  Now, the new amendments also prohibit employers (of all sizes) from even seeking a job applicant's or employee's salary or wage history, except in certain situations.  The law allows an employer to confirm an applicant's wage history only if the applicant voluntarily offers it or after the employer makes an offer of employment which includes an offer of compensation. In addition, businesses who employ 15 or more employees who make an offer of a promotion or a lateral transfer to an existing employee must provide a "wage scale or salary range" to the employee if the employee requests the information.  Businesses should review current hiring processes to ensure compliance. Failure to follow these requirements can result in penalties under RCW Sections 49.58.

Paid Family Medical Leave Amendment to Paid Family Medical Leave Act - 
Effective January 2020WAFMLA
 
Just when businesses were starting to get comfortable with withholding and paying Paid Family Medical Leave premiums, we now have to implement the actual leave and make sure that policies comply with the amendments made late last year.
 
Starting January 1, 2020, employees may apply for and take typically up to 12 (but in some pregnancy related instances up to 18 weeks) of Paid Family Medical Leave and receive the Paid Family Medical Leave insurance benefit from the State of Washington Employment Security Department. Benefits are capped at $1,000 per week.
 
Qualifying events for leave include: (1) Family Leave: bonding with a new child coming into the employee's family through birth, adoption, or foster placement; caring for a family member with a serious health condition or injury; or certain events for military families; or (2) Medical Leave for the Employee: recovery or treatment for the employee's own serious health condition or injury, including recovery from childbirth. Typically, an employee can take up to 12 weeks of medical leave or family leave within a claim year. Employees can take as little as eight consecutive hours per week of leave.
 
Employees must apply online at www.paidleave.wa.gov/apply-now  and will need to set up an account, complete an application and upload documentation including a Certification of Serious Health Condition form, if applicable. Typically, all leave, but for parental bonding leave, requires a "waiting week" during which an employee may use Paid Sick Leave hours or other paid time off if accrued and eligible. The weeks start on Sunday so it is important to track hours for paid leave benefits carefully. Employees will have to file weekly claims.
 
The newest amendments clarify that businesses may allow employees using Paid Family Medical Leave insurance benefits to also use accrued paid time off benefits as "Supplemental Benefit Payments."  This includes: paid vacation, paid sick time, paid parental leave or other paid time off. This Supplemental Benefit Payment can allow employees to receive up to 100% of the employee's regular pay during the period of leave. However, this requires employers to calculate and track the Supplemental Benefit Payment amount and reduce paid leave banks accordingly.  The problem is that while businesses can ALLOW employees to use Supplemental Benefit Payments, the business cannot REQUIRE an employee to use the Supplemental Benefit Payments. This can result in the employees being able to take additional time off during the year outside of the PFML.
 
The PFML only provides reinstatement to the employee's position protections to employees who work for an employer who is a larger employer, 50 or more employees and when the employee has worked 1250 hours in the past 12 months prior to leave, similar to FMLA.  PFML runs concurrently with the federal Family Medical Leave Act in most cases. The Washington Family Leave Act is no longer law.
 
Businesses need to review all leave policies, ensure that all notices are posted, and connect early with employees who may want to take PFML so that the employee understands the employee's obligations under the law.
Washington Overtime ExemptionWAOvertimeExemption
 
The Washington Department of Labor & Industries (L&I) has updated the employment rules that determine which workers in Washington are required by law to be paid minimum wage, earn overtime pay, and receive paid sick leave and other protections. L&I is setting a new minimum salary threshold and has updated the job duties tests, both of which are used to determine which employees can be classified as exempt from overtime and other Minimum Wage Act protections.
 
Effective July 1, 2020, the state overtime exempt salary threshold will be determined by multiplying the current state minimum wage by 1.25. Keep in mind that, in addition to the changes to the overtime rules, Washington's minimum wage increases effective January 1, 2020 from $12 per hour to $13.50 per hour.
 
It is also important to note that the U.S. Department of Labor raised its threshold to $684 per week ($35,568 per year) effective January 1, 2020. Salaried exempt employees have to be paid at least that amount in 2020 because it is higher than the first phase of the Washington state threshold increase of 1.25 times the state minimum wage (or $675 per week). Where state and federal thresholds conflict, as in this context, employers must meet the threshold most favorable to employees. Effective January 1, 2021, the state threshold will be more favorable because small businesses (<50 employees) will have to pay at least 1.5 times the state minimum wage ($827 per week), and large businesses will have to pay at least 1.75 times the minimum wage ($965 per week).
 
Under the approved changes, the minimum pay a salaried worker must receive to be considered exempt will increase incrementally to 2.5 times the state minimum wage by 2028. In addition to the changes in the minimum salary level, the new rules update the job duties tests to more closely align with the federal job duties tests under the FLSA.
Long Term Care Tax - Coming in 2022WALongtermCare

In 2019, the legislature passed the Long Term Care Trust Act which will require employees to pay a small monthly payroll tax, 58 cents for every $100 the employee earns in income. Employees who pay into the program for three years will be able to access the Long Term Care benefit which will be approximately up to $36,500 to pay for respite care, in home caregiving, time in an assisted living facility, and other elderly care expenses.
 
Domestic Violence Workplace PosterDomesticViolencePoster

To help educate and provide critical resource information for victims of Domestic Violence, a new law requires employers to post a new domestic violence survivor resources poster in the workplace. The Employment Security Department provides the new poster for free at
FEDERAL - FLSAFederal

Department of Labor Final Overtime Rule - Effective January 2020DOLOvertimeRule

Back in March 2019, we wrote about the Department of Labor's (DOL) proposed Final Rule, which increased the salary basis for employees who could qualify under the Fair Labor Standards Act (FLSA) administrative, executive, and professional exemptions, commonly referred to as the "White Collar" exemptions. That rule became final in September 2019 when the DOL issued its much anticipated Final Rule. Effective January 1, 2020, employers need to ensure that their employees are classified in accordance with the Final Rule, which increases the minimum salary required for an employee to be considered exempt from overtime pay.
 
The FLSA requires employers to pay employees a minimum wage and overtime at 1.5 times the employee's regular rate for any hours worked in excess of 40 in a week, unless the employee is classified as exempt from those requirements under the FLSA. White Collar exemptions are covered under Section 13(a)(1) of the FLSA, which exempts "bona fide" executive, administrative, professional, outside sales, and computer employees from the minimum wage and overtime requirements. The statute and regulations generally have required three things:  (1) the employee must be paid a predetermined and fixed salary that is not subject to reduction because of variations in the quality or quantity of work performed; (2) the amount of salary paid must meet a minimum specified amount; and (3) the employee's job duties must primarily involve executive, administrative, or professional duties as defined by the regulations. 

The DOL's Final Rule addresses only the salary basis for the exemptions. It does not address the "duties" test outlined above, which has long been the source of a considerable amount of exempt-status litigation.
 
Summary of the Final Rule:
  • Effective date:  January 1, 2020
  • Minimum Salary Basis for Executive/Administrative/Professional Exemptions:  The "standard salary level" increases from the currently enforced level of $455 per week ($23,660 annually) to $684 per week ($35,568 annually).
  • Salary Basis Includes Certain Nondiscretionary Bonuses, Incentive Payments, and Commissions:  Employers may use nondiscretionary bonuses and incentive payments (including commissions) paid at least annually to satisfy up to 10% of the standard salary level.
  • Increase for Highly Compensated Employees:  The total annual compensation requirement for "highly compensated employees" will be raised from currently enforced level of $100,000 per year to $107,432 per year.
  • No Change to the Duties Tests: Again, the DOL is avoiding the outdated and ambiguous terms of the duties tests for each of the exemptions and is not proposing any changes.
  • Caution:  Employers must comply with both federal and state overtime rules, which may often be different. Neither Oregon nor Washington, for example, acknowledge the Highly Compensated Exemption. In addition, the Washington State legislature recently changed its overtime rules and regulations, further impacting how employees are treated. Businesses are encouraged to audit the exempt status of their employees to ensure compliance with both federal and state overtime laws.
  • Conclusion:  The DOL estimates that the changes in its new overtime rule will make over 1.3 million employees throughout the United States newly eligible for overtime unless employers either raise the guaranteed salary basis for the employee or restructure and limit overtime hours. Do not hesitate to reach out to the Employment Law attorneys at FWW for guidance in navigating these new changes.  

  
Kelly Tilden    focuses her practice in the areas of employment  law, business, and litigation. She advises clients regarding the hiring, discipline and termination of employees, compliance with state and federal civil rights, wage and hour laws, and leave laws. Kelly offers practical guidance and experienced-based insight to help employers confidently apply state and federal regulations. She has been s elected by her peers for inclusion in the  Best Lawyers in America ®  2018-2020 for Employment Law - Management.

Contact Kelly at 503.228.6044 or  ktilden@fwwlaw.com

Kim McGair ' practice emphasizes a wide range of litigation matters including employment, commercial litigation, commercial collections, personal injury defense, and real estate litigation. She is an advocate for her clients and provides them with sensible advice and strong representation to protect their interests and help them achieve their objectives as efficiently as possible. Kim was selected by her peers for inclusion in the Best Lawyers in America® 2018-2020 for Commercial Litigation and to the Oregon Super Lawyers list 2019 for commercial litigation.

Contact Kim at 503.228.6044 or  kmcgair@fwwlaw.com


Trish Walsh  focuses her practice in the areas of litigation and employment law, protecting clients' interests inside and outside the courtroom. In her employment practice, Trish drafts, audits and updates policy handbooks and provides advice on employment issues under Oregon, Washington and federal laws.

Contact Trish at 503.228.6044 or  twalsh@fwwlaw.com




Jon Himes  practices in several areas including litigation, employment, and financial services, enabling him to assist clients with a full-range of legal and business challenges. His employment practice focuses on employment litigation and wage and hour laws. 

Contact Jon at 503.228.6044 or  jhimes@fwwlaw.com

 

 

Copyright © 2020 Farleigh Wada Witt. All Rights Reserved.

 

The contents of this publication are intended for general information only and should not be construed as legal advice or opinion on specific facts and circumstances.

 

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