Compliance Implications of the Nation’s Most Progressive Family & Medical Leave Law

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Oregon just passed the country’s most progressive family and medical leave program in its House Bill 2005. And while the law won’t take effect until 2023, organizations in the state can begin their compliance preparations now.

Under the new rule, which the Oregon Senate passed 21-6 with bipartisan support, workers will get up to 12 weeks of paid time off for family and medical leave.

Under the new rule, which the Oregon Senate passed 21-6 with bipartisan support, workers will get up to 12 weeks of paid time off for family and medical leave. This can be used to care for newborns or adopted/foster children, recuperate from personal serious illnesses or address domestic violence situations. Furthermore, the barrier to entry for employees is low, granting access to any employee who has earned at least $1,000 from the employer in the previous year.

Employees and employers will both pay into the family medical leave fund, 60% and 40% respectively. Small organizations with less than 25 employees will not have to contribute.

This far extends the benefits of the federal Family and Medical Leave Act (FMLA), which was passed in 1993, that only ensures covered employees are provided unpaid leave for qualified medical and family reasons. While HB 2005 is not federal law, if there is anything we have learned about policy trends from GDPR or state-level harassment legislation, it’s that law tends to build momentum. Eight states, including Oregon, have already passed their own rules.

As we prepare for 2023, there are key areas companies should be considering.

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Keeping Up with Employment Law Changes

According to NAVEX Global’s 2019 Definitive Corporate Compliance Benchmark Report, the top two challenges of policy and procedure management programs are:

  1. Training employees on policies
  2. Aligning policies with changing regulations

With a new family and medical leave benefits program, legal teams and their compliance counterparts will need to navigate both.

Aligning Policies with Changing Regulations

The broad language of Oregon’s House Bill 2005 creates a particularly challenging piece of legislation with which to align and comply. 

I would start with aligning policies. The broad language of Oregon’s House Bill 2005 creates a particularly challenging piece of legislation with which to align and comply. The way the bill is written, the definition of family is loose, which will certainly leave room for interpretation and argument. For instance, in the law, “family” includes traditional familial designations, but also extends to include “any individual related by blood or affinity whose close association with a covered individual is the equivalent of a family relationship.” There is a lot of gray area here that in-house legal teams will need to make more black and white.

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Being one of only a handful of new, progressive family and medical leave laws, unfortunately there isn’t much case law for companies to reference as implementation guideposts. This presents both the exciting as well as nerve racking aspects of being a lawyer. Here we get to pioneer how we apply the letter as well as the spirit of the law, forcing companies to venture into uncharted territory.

In lieu of firm examples of evidence-based application, we need to fully distill exactly what we believe the spirit of law is intending to accomplish. Once we have defined our interpretation of the law, the steps we take to ensure compliance should be clear and documented. This strengthens corporate defensibility.

Our first goal is always prevention of a compliance breach, but in the case of a misstep, proper documentation of a well-informed strategy creates an audit trail and shows regulators, if nothing else, that our intent was to be compliant.

Training Employees & Frontline Managers

While 39% of policy and procedure respondents in the benchmark report noted that one of their top policy-management challenges is aligning policies with changing regulations, nearly half (48%) view training of employees on policies and procedures as their top challenge. Furthermore, 63% of all respondents are planning to prioritize “training and supporting frontline managers and supervisors of their responsibilities,” over the next 12 months. This is key in sensitive employment law requirements such as family and medical leave as frontline managers represent the company in these situations. They need to understand exactly how to ensure their direct reports are aware of the family and medical leave benefits available to them.

While regulatory policy alignment is critical, if managers – those responsible for leave management – do not properly communicate to their employees the types of absences that are covered, it creates significant risk for the organization.

Learning to Love Oregon’s New Law

Beyond providing better benefits for your team, there are plenty of reasons to embrace Oregon’s new regulation. Though, as we can see implementation may not be easy, this is an opportunity for employers to attract talent from states who don’t have such accommodating and progressive policies. This can be a great time to recruit, letting potential employees know what great perks and benefits Oregon offers.

Even if your organization is not based in Oregon, you should be paying attention – and not only to keep your best talent from being lured to the Beaver State. If GDPR or state-level harassment laws are any indicator, this type of bill could soon spread across the country. It is always best to be aware of the most progressive standards out there.

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