Oregon Passes Paid Family Leave Law

Oregon has become the eighth state requiring employers to provide their employees with paid family leave, marking a growing momentum in time off policies for workers from individual states and employers in general.

The Beaver State earlier this month passed the legislation, which covers 12 weeks of paid time for new parents and those who need to care for an ill family member with a serious health condition or for the employee’s own serious health condition.

The move comes shortly after Connecticut in June adopted a leave policy, joining California, Massachusetts, New Jersey, New York, Rhode Island, Washington and the District of Columbia in passing such laws.

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Still, Oregon’s policy is unique in that the leave includes victims of domestic violence and defines family broadly to include “any individual related by blood or affinity whose close association with a covered individual is the equivalent of a family relationship.” It also applies to nearly all workers in the state, including part-timers. Employees must make more than $1,000 annually.

The law will be funded through a payroll tax, not to exceed 1% of employee wages, where employees pay in 60% of the total rate and employers cover the remaining 40%. Small businesses are exempt from paying the tax.

The law–set to go into effect in 2023–is the latest indicator of growth for paid leave policies, particularly for new parents.

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Although the United States is the only industrialized country that doesn’t mandate paid leave for new parents, some have been calling for that to change. With some states beginning to pass their own legislation, President Trump earlier this year called for a federal paid family leave law to give parents a “chance to bond with their newborn child” during his State of the Union address. Details on his plan, though, were scarce.

Meanwhile, a number of employers have implemented paid leave policies on their own as more employees demand them in a tightened labor market. The percentage of employers offering the benefit has increased significantly over the last three years for every type of parental leave, according to research from the Society for Human Resource Management. About a third (34%) of organizations offer paid leave to mothers and slightly fewer (30%) to fathers. One organization in five reported offering family leave, paid or unpaid, beyond what is required by both the federal Family and Medical Leave Act and by state mandates.

“In today’s war for talent, one of the biggest reasons employers are offering new workplace flexibility options is that it’s a strong recruitment and retention tool, providing a competitive advantage over other employers,” says Emily Dickens, the society’s chief of staff.

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Companies including Dollar General, VF Corp. and Unum have rolled out new policies for employees in the past year, while others including Bloomberg and Hewlett Packard Enterprise have enhanced their existing policies to provide more time off to better serve their employees and to help them boost their work/life balance equation.

Although employers have increasingly been rolling out their own policies, many companies oppose a federally mandated policy citing cost and administrative burdens.

SHRM, for instance, says it advocates for workplace flexibility policies that meet the needs of both employers and employees.

“Good policy cannot be a one-size-fits-all government mandate but should accommodate varying work environments, employee representation, industries and organizational size,” Dickens says.

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Kathryn Mayer
Kathryn Mayer is HRE’s former benefits editor and chair of the Health & Benefits Leadership Conference. She has covered benefits for the better part of a decade, and her stories have won multiple awards, including a Jesse H. Neal Award and honors from the American Society of Business Publication Editors and the National Federation of Press Women. She holds bachelor’s and master’s degrees from the University of Denver.