The Employer’s Guide to Paid Family and Medical Leave in Oregon

Oregon workers have been able to take paid leave since 2023, thanks to the state’s inclusive paid family and medical leave (PFML) program. As of 2026, Oregon is one of 15 states (plus DC) that give workers time and financial support to care for themselves and their families at crucial life junctions. 

If you’re an Oregon employer or plan to become one, keep reading for a summary of how the program works, what it costs, and which compliance steps to take.  

What is Paid Leave Oregon?

Paid Leave Oregon was designed to be as comprehensive as possible, giving Oregon-based workers three essential types of paid leave: 

• Family leave: To bond with a new child in the first 12 months after their birth, adoption, or foster placement; to care for a family member with a serious health condition

• Medical leave: To take care of yourself in the midst of or after a serious health condition

• Safe leave: To take care of yourself or your child if one or both of you have experienced sexual assault, domestic violence, harassment, bias crimes, or stalking

Employees can take 12 weeks of paid leave a year, with up to two additional weeks for people who are pregnant, have given birth, or have additional needs because of childbirth. 

Who’s eligible for paid leave? 

Almost every employee in Oregon is covered under the state’s paid leave program, regardless of whether they work full-time, part-time, seasonally, or for multiple employers. To qualify for leave, they have to: 

• Work for an employer in Oregon

• Earn at least $1,000 in their base year before they apply for benefits (a base year is the first four of the last five completed calendars of work before a leave year begins)

• Experience a qualifying life event

Federal government employees, Tribal government employees, public office holders, and self-employed people are not automatically covered under Oregon’s program. 

Can self-employed people participate? 

Oregon lets self-employed workers (like independent contractors and partners) opt into the state’s leave program as long as they: 

• Work in Oregon

• Have earned at least $1,000 in net income from self-employment in the previous year

Self-employed people have to contribute 0.6% of their Oregon net income from self-employment every quarter to receive program benefits. Check out these instructions to sign up for coverage. 

Does paid leave come with job protection? 

Paid Leave Oregon includes job protection for employees who’ve worked at least 90 consecutive days for their employers. As the employer, you’re responsible for reinstating employees to their same jobs after leave to the best of your ability. 

If for some reason you have to eliminate a role or fill it during someone’s leave, you’re still required to follow through with job protection. If an employee’s original position is no longer available when they’re finished with leave:

• Employers with 25 or more employees: You’re required to give them a similar position or an equivalent position at a job site within 50 miles of their former role. 

• Employers with fewer than 25 employees: You’re allowed to give your employee a different position when they return, as long as it has similar job duties and the same benefits and pay. 

Paid leave in Oregon also comes with continued health insurance. So if you already offer your employees health care and pay part of their premiums, keep that up while they’re on leave. 

How is Paid Leave Oregon funded?

Like lots of other state PFML programs, Paid Leave Oregon is funded by employers and employees. Every year the Oregon Employment Department (OED) determines the annual leave contribution rate, which can’t ever exceed 1% of an employee’s gross wages. 

The 2026 contribution rate is 1% of employee wages, up to the Social Security wage cap. Here’s the breakdown of pay: 

• Employees pay 60% of the contribution rate 

• Employers with 25+ employees pay roughly 40% of the contribution rate

• Employers with 1-24 employees pay 0% of the contribution rate 

Let’s go over a couple of examples. 

Example 1: You run a small brick-and-mortar business and have 12 employees. Because you’re a smaller employer, you’re not required to make your own paid leave contributions, but you are required to withhold contributions from your employees’ wages and remit them to the state every quarter.  

If one of your employees makes $60,000 a year, you’re responsible for remitting $90 a quarter on their behalf in paid leave contributions. Here’s the rough math: 

$60,000 / 4 quarters = $15,000 a quarter

1% (contribution rate) of $15,000 is $150

60% (employee portion) of the 1% rate is $90

Example 2: You own a company that employs 75 people in Oregon. You’re considered a larger employer, so you’re responsible for: 1) withholding 60% of the contribution rate from your employees’ wages and 2) paying the remaining 40% of the contribution rate yourself. 

If one of your employees makes $60,000 a year, you’re responsible for remitting $150 a quarter on their behalf in paid leave contributions. (As a reminder, quarterly wages are $15,000, and 1% of $15,000 is $150.)

You’ll withhold $90 from your employee’s wages to cover their contribution portion (60% of the 1% rate), and pay the remaining $60 yourself (40% of the 1% rate). 

How much money do employees receive on leave? 

Paid Leave Oregon gives people weekly benefits on leave. The exact amount depends on how much your employees earn and how much leave they take in a week, but the state has a minimum and maximum: 

• Minimum weekly benefit: 5% of the state average weekly wage

• Maximum weekly benefit: 120% of the state average weekly wage

The state average weekly wage for 2026 is $1,410.13. Here’s a benefits calculator you can use to estimate your employees’ payments or your own. 

How does Paid Leave Oregon work alongside federal leave?

In Oregon, some employees qualify for leave with Paid Leave Oregon and the Family and Medical Leave Act (FMLA). FMLA requires all US employers with 50 or more workers to give them unpaid, job-protected leave for similar situations as Oregon’s leave program.

However, Oregon also has its own state leave law, the Oregon Family Leave Act (OFLA). Under OFLA, employers with 25 or more employees are required to give them up to 12 weeks of unpaid, job-protected leave for:

• Pregnancy disability leave

• Sick child leave

• Bereavement leave

• Military family leave

If one of your employees qualifies for all three types of leave, the leaves will happen at the same time—and your employee will receive the strongest protections from all programs. 

Paid Leave Oregon vs FMLA vs OFLA

What is Oregon’s sick leave policy?

Oregon also has a sick time law that guarantees almost all employees protected sick time, which they can use for a number of reasons. Employees accrue one hour of sick time for every 30 hours they work, up to 40 hours a year. And they can start using sick time after they’ve been employed for at least 90 days. 

Whether or not you’re required to provide paid or unpaid sick time depends on where your business is located and how many employees you have. 

• Employers with 10 or more employees (or 6 in Portland) have to provide paid sick time

• Employees with 1-9 employees (or 1-5 in Portland) can provide unpaid sick time

What do employers need to do to comply with Paid Leave Oregon?

If you have even one Oregon-based employee or run an Oregon-based business, you’re required to participate in Paid Leave Oregon. Make sure you follow these steps:

1. Create an employer account

If you haven’t yet, create an account with Oregon’s payroll reporting system, Frances Online, so you can file payroll reports and report paid leave contributions. You’ll need your federal employer identification number (FEIN) and some recent payroll data to get started. 

2. Tell employees what to expect

Educate your employees about the state’s paid leave program 1) right when they’re hired and 2) any time you change your leave policies to reflect changes from the state. Oregon requires you to display the Paid Leave Model Notice in your workplace (and deliver it digitally or by post to remote workers). The notice covers:

• Employees’ right to claim and receive paid leave benefits 

• How to file a claim to receive benefits 

• Instructions that employees notify employers at least 30 days before starting leave whenever possible (they can receive penalties if they don’t follow the notification requirement)

• The process to appeal benefits decisions

• Employees’ right to job protection and continuation of health benefits during paid leave

• Protection from discrimination and retaliation related to taking paid leave

• Confirmation that health information is kept confidential

• How to file a civil action or file a complaint for a violation of rights

3. Remit quarterly payroll contributions 

All employers, regardless of your size, have to withhold contributions from your employees’ wages and send them in every quarter. 

If you have 25 or more employees, you’re also responsible for paying employer contributions on a quarterly basis. As a reminder, here’s the breakdown:

You can file your quarterly return and pay contributions on Frances Online. Quarterly reports are due April 30, July 31, October 31, and January 31. 

4. Respond to the OED when an employee applies for leave

Your employees need to give you 30 days of notice when they have a planned leave, and tell you within 24 hours of taking an emergency leave. 

After employees apply for leave online, the OED will contact your business to confirm that your employee gave you the required notice. You have five days to respond; if you don’t reply in time, the OED moves forward with your employee’s application. 

5. Continue paying health insurance and protect employees’ jobs

Any employee who’s worked for you for at least 90 consecutive days is entitled to job protection and continued health insurance during their leave. You need to uphold these protections; otherwise, you risk incurring penalties from the OED. 

6. Follow all other state and federal leave requirements 

Post a workplace notice for FMLA leave if you’re a covered employer, and prepare to give employees a Rights and Responsibilities Notice and Designation Notice if they end up requesting FMLA leave. 

You also need to post a workplace notice for the OFLA, so your employees know they’re entitled to 12 unpaid weeks of leave if they’re grieving a loved one, caring for a sick child, or incapacitated from pregnancy or childbirth. 

What happens if you don’t comply with Paid Leave Oregon? 

The OED issues penalties for noncompliance. You could receive penalties for not filing payroll reports, filing late, or failing to pay contributions altogether. There are a few types of penalties: 

• Late filing penalty: 0.02% of employee wages for filing late

• One percent penalty: 1% of employee wages for failing to file reports or pay all contributions by September 1 each year

• Late payment penalty: 10% of contributions for not responding to the OED within 10 days after a written request for a payment is sent

What will Paid Leave Oregon cost my business? 

If you have fewer than 25 employees in Oregon, the state’s leave program is basically free (aside from payroll and admin costs) because you’re not required to pay an employer contribution. 

If you have 25 or more employees, the program isn’t free, but it’s still pretty affordable. If, for example, you have $3 million in annual payroll, you’ll send a total of $30,000 a year in paid leave contributions (1% of your employees’ gross wages) to the OED.  

But you’re not responsible for paying that entire $30,000 yourself. Your employees will pay 60% of it ($18,000), and you’ll pay the remaining 40% ($12,000). That’s $3,000 out of your pocket every quarter. 

You can use this contributions calculator to estimate your quarterly payments. 

Small employers can apply for assistance grants

If you’re an employer with fewer than 25 workers, you can apply for a special assistance grant (up to 10 a year!) from the OED. There are two types: 

• A $3,000 grant to hire a temporary replacement while your employee is on leave

• A $1,000 grant for wage-related expenses like overtime and employee training

The only catch? If you accept a grant, you have to pay the 40% employer-paid leave contribution for two years after receiving assistance. Learn more about assistance grants.

Can I opt out of Paid Leave Oregon?

You’re not allowed to opt out of providing paid leave in Oregon, but you can apply for an equivalent plan if you want to provide leave benefits yourself. That means the types of leave, length of leave, and weekly benefit payments need to be the same as or more than what Oregon offers. And you can’t require your employees to contribute more than what the state requires of them. 

Can I offer extra leave benefits? 

Oregon’s PFML program gives people a good foundation for leave, but you can definitely do more, including: 

• Extending the length of leave, giving employees even more time to care for themselves and their families 

• Topping up your employees’ weekly benefit payments to 100%, so they receive their full wages during leave

• Offering additional paid sick leave or paid vacation leave employees can use in combination with state paid leave (to receive more of their wages during leave)

• Covering the employee paid leave contribution yourself to save employees the wage deductions 

• Offering a flexible return-to-work plan for employees after leave

If you try one of these options, make sure you update your company’s leave policy to reflect it. 

Taking care of business in Oregon

For more Oregon business advice, bookmark these Gusto guides to: 

• Hiring in Oregon

• Oregon's retirement program

• Starting a new business in Oregon

• Business tax incentives in Oregon

• Business grants and loans in Oregon

• Employer taxes in Oregon