The following is a summary of relevant changes to Oregon employment laws enacted by the 2011 legislature:

Employer Liability for Issuing a Dishonored Check in Payment of Wages. House Bill 2039

subjects an employer who issues a dishonored check for the payment of wages to statutory damages equal to the greater of $100 or triple the amount of the check (capped at the check amount + $500). An action may be initiated by the employee or by the Bureau of Labor and Industries (but not both). Damages awarded in an administrative proceeding by BOLI are payable to the employee who received the dishonored check. (Effective January 1, 2012)

Wage Demand Notices. House Bill 2040 specified that wage demand notices sent to an employer claiming underpayment in the final paycheck must now include the amount claimed, or allegations sufficient to allow the employer to determine the amount claimed as a condition to the employee being entitled to receive the full 30-day statutory penalty for nonpayment under ORS 652.150. Employers are now entitled to cure any defect within 12 days of receiving the notice, thereby limiting penalties to the amount of the underpayment. (Effective January 1, 2012) 

Jury Service.

• House Bill 2828 creates an unlawful employment practice if an employer with 10 or more employees ceases to provide health, disability, life, or other insurance while an employee is on jury duty, and also prohibits the employer from discharging, threatening to discharge, intimidating, or coercing an employee based on jury service. (Effective January 1, 2012)
• House Bill 3034 prohibits an employer from requiring an employee to use vacation, sick, or annual leave while on jury duty. The employee must instead be permitted to take unpaid leave. (Effective January 1, 2012)

Leave for Victims of Harassment. House Bill 3482 expands the previously existing leave entitlement for victims of domestic violence, sexual assault, and stalking, to victims of harassment. An employer with six or more employees must grant unpaid leave and provide reasonable safety accommodations to harassment victims if requested. "Harassment" includes both criminal harassment and harassment as defined under BOLI regulations. (Effective upon governor's signature)

Definition of Uniformed Service. House Bill 2241 expanded the definition of "uniformed service" in ORS 659A.082 to align it with the federal definition in the Uniformed Services Employment and Reemployment Rights Act of 1994. "Uniformed service" is now defined to mean "the Armed Forces of the United States, the Army National Guard and the Air National Guard when engaged in active duty for training, inactive duty training or full-time National Guard duty, the commissioned corps of the United States Public Health Service and any other category of persons designated by the President of the United States in time of war or national emergency." (This bill was effective as of April 14, 2011)

Notice of Arbitration Agreement. House Bill 3450 requires an employer to notify an employee in writing if an arbitration agreement is required as a condition of employment not less than 72 hours before the first day of employment. This law amends the previous statute requiring two weeks' notice. The bill requires the employer to provide a specific notice which must be signed by the employee in order to be effective:

I acknowledge that I have received and read or have had the opportunity to read this arbitration agreement. I understand that this arbitration agreement requires that disputes that involve the matters subject to the agreement be submitted to mediation or arbitration pursuant to the arbitration agreement rather than to a judge and jury in court.

(Effective January 1, 2012) 

The Washington Court of Appeals recently ruled that an employer who fails to provide mandated paid rest breaks must pay the employees for the missed rest break, but that time is compensable at their regular rate, not their overtime rate. In Washington State Nurses' Assn. v. Sacred Heart Med. Ctr., the nurses sued the hospital alleging that they were entitled to overtime pay for missed rest breaks because the missed rest break essentially extended their 40-hour workweek by 10 minutes per day.

The Court disagreed, holding that the missed ten minutes of break did not extend the workday because the employees were still at work for only 40 hours per week. The Court held that the missed rest period was more accurately described as the provision of additional labor during the workday. In the Sacred Heart case, a labor arbitrator had already determined that the hospital was required to pay straight time for all missed breaks and the employer had paid that straight time as breaks were missed. It was only the additional overtime that was sought in the lawsuit and rejected by the Court. Whether the Washington Supreme Court will agree with the arbitrator's decision remains an open question, but the Sacred Heart case certainly puts a thumb on the employee's side of the scale if the issue is squarely presented to the Court in the future.

By contrast, the Oregon Supreme Court has held that employees have no claim for missed paid rest periods because the employees were paid for all hours worked. In other words, an employee who works four hours without a break and is paid for four hours of work has been paid for all "hours worked." In doing so, it held that failure to provide a break does not extend the "hours worked." Similarly, the Court held that employees who are not provided an unpaid lunch period, but were paid for working through their lunch period, are also not entitled to any additional wages.

These cases remind us that provision of required paid, and unpaid, breaks remains important, particularly for Washington employers who may be liable for payment of additional wages for all missed breaks. In addition, the attorneys fees and statutory damages available in wage claims in both states strongly support an employer erring on the side of paying an employee for any known missed breaks.

If you have any questions about required rest and meal periods, please give any of our employment attorneys a call and we can guide you through this increasingly complex process.

For questions please contact Kim McGair.

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