Ten Things Oregon and Washington Employers Should Know For 2022
By Heather J. Van Meter - Bullard Law
December 29, 2021
1. Omicron Variant Continues to Spread, and Employers Must Continue Compliance with Facemasks, Sanitation, HVAC, Other Precautions
The Omicron variant of the SARS-COV-2 virus is quickly becoming the dominant variant around the nation and globally. Oregon Health Authority does not officially report any Omicron variant cases, but Oregon Health & Science University confirmed at least three cases existed in mid-December. In Washington, the University of Washington reports at least 50 Omicron variant cases, with community spread increasing. As noted in our prior alert, the Omicron variant generally causes milder illness than prior variants, but it is more easily spread. For employers, this means more employees are likely to be infected by the virus, and the workplace is more likely to be a source of virus spread.
Employers must continue to comply with all local and state mask and social distancing mandates and continue with cleaning and sanitizing efforts, HVAC system maintenance, filter changes, and other precautions. Employers may also wish to review and revise isolation and quarantining requirements (see #3 below) to prevent excessive absences from work as the number of exposed and infected employees is expected to rise.
2. U.S. Supreme Court Considers Vaccine Mandates While Private Employers Ready Vaccine Policies
The U.S. Supreme Court has requested the Biden Administration to submit their written arguments supporting the Occupational Safety and Health Administration (OSHA) private employer vaccine-or-test mandates and the Centers for Medicare and Medicaid Services (CMS) health care worker vaccine mandate by December 30. The Supreme Court is scheduled to hear oral arguments on January 7, 2022, to determine whether a stay should be issued pending a legal decision whether OSHA and CMS have the legal power to issue the vaccine mandates.
Although OSHA’s mandate, which applies to all private employers with 100 or more employees, is set to take effect January 4, 2022, OSHA has stated it will not issue citations for noncompliance before January 10, 2022, and will not issue citations for noncompliance with testing requirements before February 9, 2022, provided private employers are taking “reasonable, good faith efforts” to comply with the vaccine-or-test mandate. In practice, all affected employers should be preparing vaccination policies and implement those policies by January 10, 2022, unless the Supreme Court issues a stay.
Similarly, the CMS vaccine mandate, which applies to workers at facilities receiving Medicare or Medicaid funds, including hospitals and clinics and long-term care facilities, was set to take effect on January 4, 2022. Affected employees would be required to have received all vaccine shots by January 4, 2022. Implementation of the rule was stayed in 25 states but remained in effect in Oregon and Washington. However, based on the impending Supreme Court hearing, CMS has stated it will not take enforcement action “pending future developments in the litigation.” For Oregon and Washington healthcare employers, vaccine mandates have already been implemented at the state level. However, the CMS rules are slightly different, and if the Supreme Court does not issue a stay of the CMS rule, healthcare employers will need to review existing vaccine mandate policies against the CMS rules to ensure compliance with both state and national rules.
3. CDC Reduces Recommended Time for COVID Isolation and Quarantining
The U.S. Centers for Disease Control and Prevention (CDC) has reduced by half the recommended time for quarantining and isolation due to COVID. As a refresher, quarantining is the time people stay away from others if exposed to COVID but not yet testing positive or showing symptoms. Isolation is staying away from all persons including in the home, staying in a “sick room,” and using a separate bathroom to avoid exposure to other household members.
For persons testing positive for COVID, the new recommended isolation time is five days. Then, as long as the person does not have symptoms or symptoms are improving, the person may leave isolation and return to work and daily activities while wearing a mask for an additional five days. Persons who test positive and have fevers should remain in isolation until the fever is gone. For employers, this means that employees who test positive but have no symptoms or improving symptoms can return to work after five days as long as they wear masks at work for another five days.
The CDC also reduced the recommended quarantining time for persons exposed to COVID. If a vaccinated person is exposed to COVID, the person should quarantine for five days (not the previously recommended ten days), followed by five days of mask-wearing. The CDC also suggested that persons who are fully vaccinated and have booster shots may not need to quarantine at all but should wear a mask for ten days after exposure to COVID. The CDC also recommends getting a COVID test on day five after exposure or if symptoms arise.
Employers may want to consider revising their COVID quarantine and isolation policies to match CDC guidelines to ensure employees can return to work as soon as possible.
4. Washington Delays Collection of New Long Term Care Tax
Washington previously passed a new employee payroll tax to fund its long-term care insurance fund, called the CARES fund. See Bullard Law’s prior articles here and here. Facing significant opposition, on December 17, 2021, Governor Inslee and legislative leaders announced a delay in the start of employer collection of the employee payroll taxes and encouraged employers to hold off on collecting any taxes until the Legislature reconsiders the situation. However, just six days later, Governor Inslee announced that he did not have the authority to tell employers to delay collection of the employee payroll taxes, only the Legislature can do so, and the Legislature does not begin to meet again until January 10, 2022. Therefore, while the Employment Security Department in charge of collecting the new tax will not be collecting the money, employers must still collect the tax from their employees starting January 1, 2022, at the 0.0058 tax rate.
When the Legislature does reconvene, it is expected to at least delay implementation until 2023, if not make other changes to the tax. A lawsuit has also been filed challenging the tax, and a petition is circulating to repeal the tax.
For employers, this means the employee long-term care payroll tax must be collected starting January 1, 2022, as originally required, but the tax is not required to be paid to the ESD. It is unclear what employers are supposed to do with the collected tax. Some employers may choose to try to pay it to the ESD and let the ESD deal with refunds to employees if the Legislature delays implementation as expected. Other employers may choose to simply withhold the tax and set it aside with the expectation that it will be refunded to employees if the Legislature delays implementation.
5. Washington Increased Pay Threshold for Enforcement of Non-Compete Agreements
Washington employers using non-compete agreements should ensure compliance with the revised pay thresholds applicable in 2022. Non-compete agreements are void and unenforceable against employees unless they are earning more than $107,301.04. Similarly, non-compete agreements are void and unenforceable against independent contractors unless they are earning more than $268,252.59. These income thresholds are in addition to other statutory restrictions, including notice requirements, limitations on second job prohibitions, duration not longer than 18 months, and a prohibition against requiring workers to use courts outside Washington.
Washington employers using non-compete agreements should review existing agreements to ensure compliance and may wish to revise their agreements to reference the applicable regulations rather than revising or canceling agreements each year. Alternatively, Washington employers may track which employees and independent contractors have non-compete agreements that have become void and unenforceable.
6. Oregon Employers Need to Review Non-Competes to Ensure Compliance with New Restrictions
The Oregon Legislature passed new restrictions on non-compete agreements that take effect on January 1, 2022. Non-competition agreements in Oregon can now only be for twelve (12) months in duration instead of the previous eighteen (18) months’ duration allowed. The income requirements were also increased, requiring an income of at least $100,533, adjusted annually for inflation, to be enforceable. A non-competition agreement will generally be enforceable for no more than twelve months if the employee is paid for the non-competition agreement, provided the payment is the greater of at least 50% of the employee’s gross base pay and commissions at the time of termination, or 50% of $100,533 (adjusted annually for inflation). In addition, the employee must be provided a written copy of the non-competition agreement within 30 days after termination. Additionally, non-competition agreements that do not meet the statutory requirements are no longer merely “voidable”; they are now treated as “void and unenforceable” unless the agreements meet the strict statutory provisions. Covenants not to solicit an employer’s employees or customers are not impacted by the new law.
Oregon employers should review their existing non-competition agreements to determine if revisions are needed.
7. Oregon Employer Dress Codes Must Allow for Racial/Ethnic Hair (“CROWN Act”)
In 2021, the Oregon Legislature followed the lead of at least eight other states to pass the CROWN Act, which stands for “creating a respectful and open world for natural hair,” according to the national organization promoting the legislation nationwide. Effective January 1, 2022, the new employment discrimination law defines “race” to include “physical characteristics that are historically associated with race, including but not limited to natural hair, hair texture, hair type and protective hairstyles.” Notably, the definition of race does not refer to skin or hair or eye color or any other shared physical or social qualities beyond hair type or texture. The law defines “protective hairstyle” to include “a hairstyle, hair color or manner of wearing hair that includes, but is not limited to, braids, regardless of whether the braids are created with extensions or styled with adornments, locs and twists.” The law also is amended to only allow dress codes or policies at places of employment if they (a) provide for reasonable accommodation of an individual’s health and safety needs on a case-by-case basis, and new provision (b) do not have a disproportionate adverse impact on members of a protected class to a greater extent than the impact on persons generally.
In practice, employers are permitted to have dress codes and policies as long as they allow for accommodation of individual health and safety needs AND do not disproportionately adversely impact a protected class such as race, gender, ethnicity, etc. This means, for example, an employer could have a general requirement of wearing hair nets around food preparation or in a technology manufacturer’s cleanroom but could not have a general prohibition on cornrows or braids with beads or dreadlocks for all employees. Employers with dress codes should review their policies to ensure compliance with the new law.
8. Oregon Delays Paid Family Leave; Washington Paid Family and Medical Leave Tax Rates Increase for 2022
In 2021, the Oregon Legislature voted to extend the deadlines to implement Oregon’s Paid Family Medical Leave Program. The deadline for the Employment Department Director to adopt rules for Oregon’s Paid Family and Medical Leave Program was extended from September 1, 2021, to September 1, 2022. Additionally, the start date for employer and employee contributions was extended to January 1, 2023, and the start date for benefit payment was extended to September 3, 2023. For now, Oregon employers can wait until September 2022 to begin preparing.
Washington employers had no such reprieve, as Washington’s Paid Family and Medical Leave law was implemented in 2020. Employees who have worked up at least 820 hours for a Washington employer during the previous year were eligible, as of January 1, 2020, for up to 12 weeks of paid family or medical leave or up to 16 weeks of combined paid family and medical leave, eligible annually. The program is funded by employer and employee payroll taxes and administered by the Employment Security Department (ESD). Beginning January 1, 2022, the premium rate for Paid Family and Medical Leave will increase from 0.4% to 0.6% of employee gross wages up to the Social Security rate cap ($147,000 for 2022). Washington employers with 50 or more employees working in Washington state must pay 26.78% of this 0.6% premium rate. Washington employers must also provide notice to employees of the Paid Family and Medical Leave program.
9. Oregon Employers Cannot Mandate Driver’s Licenses Unless Job-Related
Starting January 1, 2022, Oregon law makes it unlawful for an employer to require an employee or prospective employee, as a condition of employment or continuation of employment, to possess or present a valid driver’s license unless the ability to drive legally is an essential function of the job or is related to a legitimate business purpose. The same law also makes it unlawful for an employer to refuse to accept from an employee or prospective employee other forms of identification, other than driver licenses, deemed acceptable for purposes of federal forms used to verify identification or employment authorization (i.e., Form I-9).
In practice, Oregon employers should not request to see an applicant’s or employee’s driver’s license unless it is necessary for the employee’s job or related to a legitimate business purpose. When completing employee I-9 forms, employers may request the forms of identification that are listed on the I-9 form as acceptable identification.
10. Oregon and Washington Increase Minimum Wages for 2022
Washington’s minimum wage for non-agricultural workers is increased to $14.49 per hour for 2022. In addition, certain cities in Washington have higher minimum wage rates. This increase also increases the thresholds for overtime exempt employees. To be overtime exempt, employees of Washington employers must earn a salary of at least 1.75 times the minimum wage ($52,743.60 per year).
Washington non-dairy agricultural employers also must pay overtime to workers working over 55 hours per week.
Oregon’s minimum wage does not increase until July 1, 2022, and at that time will range from $12.50 per hour in non-urban counties to $13.50 per hour in most counties and up to $14.75 in the Portland Metro region. Although this change takes effect in July, employers will want to budget accordingly for 2022. Beginning in July 2023, minimum wages will increase with an increase in the U.S. City average consumer price index (CPI).
What Can Oregon and Washington Employers Do Now That The Supreme Court Ruled? https://t.co/JZFafXvJCA
Split Decision: Supreme Court Throws Out Vaccine Mandate For Large Employers But Revives It For Healthcare Workers https://t.co/P6NIVeiRKG