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Oregon Fair Work Week Act Took Effect July 1, 2018

07/01/18

Author: ADP Admin/Tuesday, July 10, 2018/Categories: State Compliance Update, Oregon

Overview: Employers operating in Oregon are reminded that Oregon’s predictive scheduling law, the Fair Work Week Act, took effect for covered employers on July 1, 2018.  The law establishes certain requirements related to the scheduling of covered employees in certain industries. Some key features of the law are discussed below.

Effective Date: July 1, 2018

Details:
Covered Employers
The law applies to businesses in the retail, hospitality and food service industries that employ at least 500 employees worldwide.  Determination of the number of employees must take into consideration “chains,” which are companies with shared ownership plus similar trade names or other marks, and “integrated enterprises,” which requires an examination of interrelationships, control, common ownership and other factors.

According to Oregon’s Bureau of Labor and Industries (BOLI), the number of employees employed by an employer is calculated based upon the average number of employees employed on each work day during each of 20 or more workweeks in the current calendar year or immediately preceding calendar year.

Covered Employees
The law only applies to employees of covered employers who perform services “relating to” the categories “retail trade,” “hotels and motels” or “food services.” The following categories of workers are not covered:
  • Salaried, exempt employees;
  • Workers supplied by a worker leasing company; and
  • “Employees of a business that provides services to or on behalf of an employer.”
According to the regulations promulgated by BOLI, the last category above refers to employees of a covered employer who provide services that are “wholly distinct from” and “ancillary to” a covered employer’s primary business function. For example, a non-exempt bookkeeper employed by a hotel would not be covered by the law.

Employer Obligations under the Law
Notice of good faith estimate of work schedule
This requirement applies to employees hired on or after July 1, 2018.  For these new employees, employers must provide the following information at the time of hire:
  • Median number of hours the employee is expected to work in an average month;
  • An explanation of the voluntary standby list; and
  • An explanation as to whether an employee who is not on a standby list may expect to work on-call shifts, and if so, an objective standard for when an employee may be expected to work on-call shifts if the employee is not on the standby list.

Voluntary standby list
Employers may maintain a “voluntary standby list” of employees who agree to be willing to work additional hours based on unanticipated customer needs or unexpected absences.  To take advantage of maintaining such a list, the employer must provide employees with written notification of the following:
  • That inclusion in the list is voluntary;
  • How to be removed from the list;
  • How the employer will notify standby list employees of additional hours and how to accept the additional hours;
  • That the employee is not required to accept the additional hours offered; and
  • That an employee on the standby list is not eligible for additional compensation for changes to the employee’s written work schedule resulting from acceptance of additional hours as a result of being on the list.
Employers are required to provide employees on a standby list notice of additional hours by one or more of the following methods:
  • In-person conversation;
  • Telephone;
  • Email;
  • Text message; or
  • Other electronic or written format.

Advance notice of work schedule
Employer must provide covered employees with written work schedules at least seven calendar days in advance of the first day on the schedule. Such schedules must cover the day after the last schedule was provided, and must include all work and on-call shifts for the entire period covered by the schedule. Schedules must be provided to new employees on or before their first day of work, and to employees returning from a leave of absence on their first day of work upon returning from leave.  They must also be posted in the workplace, both in English and in the language typically used to communicate with employees.  As of July 1, 2020, schedules must be provided 14 calendar days in advance.

At any time after the advance notice of written work schedule is made, an employee may request in writing that the employer add the employee to more shifts. Changes to the written work schedule resulting from these written requests are not subject to the advance notice requirements of this law.

Predictive schedule pay
For schedule changes made with less than seven days advance notice (14 days beginning July 1, 2020), employers may be required to provide employees with predictive scheduling pay.  Where an employee accepts such a schedule change, employers must pay employees for one hour at their regular rate of pay if the employer schedules the employee for an additional work-shift or on-call shift, or if the schedule change:
  • Adds more than 30 minutes of work to the employee’s work shift; or
  • Changes the start or end time of the employee’s work shift with no loss of hours.
The employer must pay the employee at ½ the employee’s regular rate of pay for each hour the employee does not work due to the employer:
  • Subtracting hours from the employee’s work shift for non-exempt reasons;
  • Changing the date, start time, or end time of the employee’s work shift for non-exempt reasons;
  • Cancelling the employee’s work shift for non-exempt reasons;
  • Not asking the employee to work when the employee is scheduled for an on-call shift.
The employee’s regular rate of pay for purposes of predictive scheduling pay shall be determined as follows:

(a) For employees paid on the basis of a single hourly rate, the regular rate of pay means the same hourly rate the employee earned for work performed during the pay period.

(b) For employees who are paid multiple hourly rates of pay, the regular rate of pay means the hourly rate of pay the employee was to be paid for:

(A) The work period or shift that commences prior to the required 10-hour rest period having been satisfied when the employee is required to be compensated for work performed during a rest period required by the predictive scheduling law; or

(B) Work performed during the work period or shift affected by the employer-requested change in schedule when the employee is required to be compensated for a work schedule change pursuant to the predictive scheduling law; or

(C) When the employee earns multiple hourly rates of pay during the work period or shift, the weighted average of the hourly rates of pay for the work period or shift.

(c) For employees paid a salary, the regular rate of pay means the employee’s total wages earned during the pay period covered by the salary divided by the number of hours agreed to be worked in the pay period which the salary is intended to compensate. For an employee paid a salary whose hours of work vary from work week to work week, the regular rate of pay is determined by dividing the amount of the salary by the number of hours worked in the pay period.

(d) For employees paid on a commission or piece-rate basis only, the regular hourly rate of pay is determined by adding together the total earnings for the pay period and dividing this sum by the number of hours worked during the pay period.

(e) For employees paid an hourly, weekly or monthly wage and also paid on a commission or piece-rate basis, the regular rate of pay means the rate of pay equivalent to the employee’s hourly, weekly or monthly wage.

(f) For employees who are scheduled to work on an on-call basis, the regular rate of pay means the rate of pay the employee will earn when called in to perform work.

(g) The regular rate of pay does not include:

(A) Overtime, holiday pay, or other premium rates. However, where an employee’s regular rate of pay includes a differential meant to compensate the employee for work performed under differing conditions (for example, a shift differential for working at night), such a differential rate is not considered to be a premium;

(B) Bonuses or other types of incentive pay;

(C) Tips; or

(D) Any additional compensation an employer is required to pay an employee as predictive schedule pay.

When predictive schedule pay is NOT required
Employers are not required to pay employees for short notice schedule changes that are the result of the following:
  • Subtraction of hours due to discipline of the employee;
  • Threats to employees or property;
  • Failure of public utility;
  • Natural disaster or similar causes;
  • Change or cancellation of ticketed events; or
  • Use of voluntary standby list

Right to rest between shifts
Employers may not schedule or require employees to work for a period of ten hours following the end of the previous calendar day’s shift; or within the first ten hours following the end of a shift spanning 2 calendar days without the employee’s consent.  If the employee consents, the employer must compensate the employee at 1.5 times the employee’s regular rate of pay for all hours worked within the mandated rest period. The mandatory rest period rule does not apply if the split shift is entirely within 1 calendar day.

Right to have input into work schedule
Employees have the right to identify any limitations or changes in work schedule availability and also may request not to be scheduled for work shifts during certain times or at certain work locations. Employers are not required to honor these requests, however, they may not retaliate against employees for making them.

Notice and posting requirements
Employers must display a poster, which will be developed by BOLI, giving notice of the rights and responsibilities of this law. The poster must be posted in a conspicuous place at the workplace or provided on an individual basis if displaying the poster is not feasible.

Also, the employer is required to post the written work schedule in a conspicuous and accessible place, in English and in the language the employer typically uses to communicate with the employees.

Recordkeeping requirements
Employers must retain records demonstrating their compliance with the law for 3 years.

Technical assistance from the BOLI can be found at this link:
https://www.oregon.gov/boli/TA/Pages/Predictive-Employee-Scheduling.aspx

The final rules implementing the law can be found at this link:
https://www.oregon.gov/boli/WHD/docs/ProposedRules/Permanent%20BLI_15-2018.pdf

A link to the text of the law can be found at this link:
https://olis.leg.state.or.us/liz/2017R1/Downloads/MeasureDocument/SB828/Enrolled

A link to the poster employers are required to display can be found here:
https://www.oregon.gov/boli/TA/docs/Work_Schedules_Poster.pdf 

Action Required: If you are an affected employer, you should familiarize yourself with the requirements of the law and prepare for the enactment of the new laws by taking steps to determine your long-term scheduling and staffing needs. As always, please be sure to contact your Human Resources Business Partner if you have any questions.

This content provides practical information concerning the subject matter covered and is provided with the understanding that ADP is not rendering legal advice.

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