How Employers Can Prepare for Paid Leave Oregon

Now is the time for Oregon employers to start preparing for the state’s new paid family and medical leave insurance (PFMLI) program, known as Paid Leave Oregon.

Funded through payroll taxes, employers and employees will begin paying into the fund on January 1, 2023. Employees will be able to begin applying for Paid Leave Oregon benefits starting September 3, 2023.

Click here for more resources about Paid Leave Oregon

Important Dates

By Jan. 1, 2023, Employers are required to post the model notice poster at each work site and they must provide it electronically or by mail to any remote workers.

On Jan. 1, 2023, if your business has 25 or more employees, you will start paying into the program.

On Sept. 3, 2023, employees can start applying for benefits.

How does Paid Leave Oregon work for employers?

Employers
If your business employs 25 or more employees, you will participate and pay into the program. Employers and employees share the costs, which means you will pay 40% of the contribution and your employees will pay 60%. 

Small Employer
If you are a small employer – a business or organization with fewer than 25 employees – you are not required to make payments, but you will still need to collect and submit your employees’ contributions. 

• Your employees will participate in the program, no matter the size of your business.
• As a small employer, you are not required to pay the employer portion of Paid Leave Oregon contributions but you will still need to collect and submit your employees’ portions.
• Even though you do not make payments, payments will still be taken from your employees’ paychecks, so they are still covered and get the same benefits.
• If you choose to make the employer payments, you can apply for an assistance grant that helps cover costs, such as hiring a temporary worker when an employee takes leave.

For more information, visit the Employer Page on the Paid Leave Oregon website.

How Employers Can Plan Ahead

STEP 1: Decide if you will use the state plan for Paid Leave Oregon benefits, or go with your own equivalent plan.

An equivalent plan must:

• ​Cover all employees who have been continuously employed with the employer for at least 30 calendar days.
• Ensure employee contributions are not greater than what would be charged under the state plan. 
• Provide benefits that are equal to or greater than the benefits offered by the state plan.​

For more information, visit the Equivalent Plans Page on the Paid Leave Oregon website or contact a disability insurance provider for assistance. 

STEP 2: Prepare to make payments

• Employers with 25 or more employees will pay 40% of the contribution rate (1% for 2023). Based on the number of employees you have and the amount you pay in salaries, you can calculate ahead of time how much you will need to pay.  Example: if your business has more than 25 employees and pays $1 million in payroll, you would pay $10,000 into Paid Leave Oregon each year. Of that amount, you will pay 40%, or $4,000. 

STEP 3: Get ready to collect payments

• Employees fund 60% of the program’s costs through their paychecks.  
• If your business already uses a payroll company, they can subtract the employee’s contribution so you don’t have to.
  

Ongoing steps throughout the year

There are a few things employers will need to keep doing during the year:

• Let your employees know about Paid Leave Oregon and the latest updates.
• Make your employer payments (unless you are a small employer with fewer than 25 employees).
• Collect payments from your employees’ paychecks.
• Other compliance requirements that will be coming soon to the Paid Leave Oregon website. 

Employer Responsibilities

• You are responsible for posting a notice by Jan. 1, 2023 that tells your employees about Paid Leave Oregon, including:
  • The benefits provided
  • Their rights
  • How to file a claim
  • That their job is protected
    
• You are responsible for letting employees take time off if they are approved through Paid Leave Oregon.
  
• You are responsible for giving employees back their job when they return (if they’ve worked for you for at least 90 days.)
  
• You are not responsible for deciding if an employee is eligible or managing any employee claims. Paid Leave Oregon takes care of that.
  
• You are not responsible for paying your employees when they take Paid Leave. Paid Leave Oregon pays them an amount while they take time off.
  
• You are not responsible for making payments into Paid Leave Oregon if you are a small employer with fewer than 25 employees. Your employees will still pay their portion and get the same benefits. You will need to collect and submit their payments.