BOLI Issues Advisory Opinions on Sick Leave Incentives

The Oregon Bureau of Labor & Industries has issued Advisory Opinions concluding that sick leave incentive policies that deny a benefit to employees because they used some or all of the sick leave they are entitled to receive under the Oregon Sick Leave Law, while providing a benefit to those who do not, violates that law. More specifically, BOLI concluded these types of policies discriminate against employees who invoke their rights under the Sick Leave Law in violation of ORS 653.641(2), and may adversely impact employees who are denied the benefit in violation of ORS 653.641 (3).

The Sick Leave Law was amended effective July 1, 2017. The amendments make it clear that employers with sick leave or paid time off policies that are substantially equivalent or more generous than those provided under the law must at a minimum comply the law for the first 40-hours per year. As a result, any incentive policy or practice that offers a benefit to employees who do not use sick leave will be viewed by BOLI as a violation, unless it carves out the first 40-hours of sick leave used in a year. In short, only sick leave hours accrued and used in excess of 40-hours per year can be used to deny sick leave incentives.

BOLI’s also issued an Advisory Opinion stating that employer policies that treat vacations and other paid time off as “hours worked” for the purpose of computing overtime, but do not treat sick leave as “hours worked” for that purpose may violate the Oregon Sick Leave law. This position raises questions about whether any employer policy that treats sick leave usage for the first 40-hours in a year, differently than other paid time off, also violates the law.

BOLI’s Advisory Opinions do not constitute legal advice and are not the equivalent of a judicial decision. They do, however, reflect the enforcement posture of the agency responsible for administering the Oregon Sick Leave Law.

Employers with unionized employees are reminded that changes in sick leave incentive programs and practices will trigger bargaining obligations. Care should be taken to fulfill notice requirements and comply with decision and/or effect bargaining obligations.