SALEM — Farmers can pay the minimum wage to piece-rate employees who miss work due to illness under a bill Oregon lawmakers passed Thursday.
Senate Bill 299, approved by the House 38-21 after earlier passing the Senate unanimously, resolves some of the confusion that’s dogged Oregon’s paid sick time law since 2015.
As interpreted by the state Bureau of Labor and Industries, the statute required growers to calculate a “regular rate of pay” to compensate piece-rate workers for sick time.
The problem is workers are often paid varying rates per pound for different crops, which means their hourly wage changes over time.
This fluctuation created a conundrum for farmers, who were uncertain when the “regular rate of pay” was established.
Should a worker be paid based on the previous week’s earnings, during the harvest of a higher-value crop?
Or is the “regular rate of pay” based on average rates earned by other workers when the sick employee was missing, when a lower-value crop was picked?
Although BOLI recommended basing sick time wages on the previous week’s earnings, farmers could still face lawsuits from workers who disagreed with that interpretation.
Under SB 299, the statute clarifies that sick piece-rate employees can be paid the minimum wage unless they have a predetermined hourly, weekly or monthly wage.
Provisions in the bill also help distinguish between farms that must pay workers for sick time and those that can provide it without pay.
Throughout much of the state, 40 hours of sick time must be paid by employers with 10 workers or more, while those with a smaller workforce must still provide those 40 hours but without compensation. In Portland, that threshold is set at six employees.
Business owners and their family members weren’t supposed to contribute to this employee count, but BOLI determined that they still count as workers if they fill out a federal “W-2” form for tax purposes.
The newly passed bill exempts business owners — those who have at least 15 percent ownership in a company — and their spouses and children from the employee count.
The provision is important to multi-generational farms that have family members working on them, said Jenny Dresler, state public policy director for the Oregon Farm Bureau, which supports SB 299.
“They don’t necessarily consider themselves employees, but rather managers of the farm,” said Dresler.
Setting the ownership threshold at 15 percent was necessary to overcome objections from the bill’s critics, who feared that companies would list employees as owners to circumvent the sick pay requirement, she said.
“That was probably one of the most contentious pieces,” Dresler said.
Uncertainty over growers who participate in seasonal farmers’ markets in Portland is also relieved by SB 299.
The worry was that farmers who normally operate outside Portland but regularly sell produce within its borders would become subject to the city’s lower six-employee sick time threshold.
The bill makes clear that such temporary locations don’t count as Portland businesses.