Becoming Predictable: Oregon’s Final Rules Help Clarify Its New Predictable Scheduling Law

Seyfarth Synopsis: Oregon’s new employee scheduling law – impacting hourly employees at large retail, food service, and hospitality employers – will go into effect on July 1, 2018. Recently, Oregon published the final administrative rules interpreting this “predictable scheduling” law.

Last week, Oregon’s Bureau of Labor and Industries (BOLI) published the long-awaited Permanent Administrative Order interpreting the state’s impending predictable scheduling law (“Final Rules”), which will take effect on July 1, 2018. The Final Rules largely mirror the proposed administrative rules, issued in April 2018, and do not contain any significant surprises.

When this scheduling law takes effect on July 1, Oregon will officially become the first state with a law of this kind – imposing conditions on employers’ ability to alter employee schedules. The full text of the law is available here. It will join the ranks of San Francisco, Seattle, New York City, and Emeryville, California – all of which have enacted legislation over the past several years to curb practices like on-call scheduling, or unpredictable scheduling practices.

Oregon’s law applies to retail, hospitality, and food service employers with 500 or more employees worldwide, and governs the schedules of non-exempt employees. As of July 1, it will require that covered employers: give employees a good faith estimate of their work schedule upon hire, post work schedules at least seven calendar days in advance (until July 1, 2020 – when it becomes fourteen calendar days), compensate employees for any changes to their schedules after that time period (subject to certain exceptions), provide certain rights to rest between shifts, and prohibit retaliation against employees who request changes to their work schedule or otherwise exercise rights under the law.

Although the Final Rules do not address every aspect of Oregon’s new scheduling law, they contain many helpful insights for employers seeking guidance on how to abide by this sweeping legislation. Some of the more notable details include:

Good Faith Estimate of Work Schedules

Covered employers must provide new employees with a written good faith estimate of the employee’s work schedule upon hire. The Final Rules clarify how a “good faith estimate” is created.

For example, the estimate must contain several components: (1) the median number of hours an employee can expect to work in an average one-month period (the Rules explain how to calculate the median, which must be a single number, not a range of numbers); (2) an explanation of the employer’s voluntary standby list (if any); and (3) a statement indicating whether employees who are not on a voluntary standby list may expect to work on-call shifts and an “objective standard” for when they will be expected to be available for on-call shifts.

Advance Notice of Work Schedules.

One of the biggest pieces of this law is its advance notice requirement, and the consequences that flow from changing employees’ schedules after the mandated advance notice window. Employers must post written work schedules in a conspicuous and accessible location, at least seven (7) calendar days in advance before the first day of the work schedule. In other words, if the schedule is for July 1 to July 14, the schedule must be posted June 24.

A “conspicuous and accessible location” can be an electronic scheduling system, so long as all employees are given access to the electronic system at the workplace, and can view the work schedules of all employees at the same location.

If employers change the work schedule with more than seven days before the first day of the schedule, then it is not considered a schedule “change” under the statute, and will not require any additional compensation. Otherwise, for changes made within that seven-day window, employees cannot be forced to work any shifts not included in their original written work schedule, and any employer-initiated modifications to the work schedule are subject to the statute’s myriad predictability pay provisions.

Predictability Pay, or Additional Compensation for Scheduling Changes

The Final Rules do not provide any additional explanation about the amount of compensation required for changes to employees’ schedules (often referred to as “predictability pay”). Employers should familiarize themselves with the text of the law, which includes additional compensation, at varying rates, where employers: add more than 30 minutes to a shift, change a start or end time of a shift with no loss of hours, subtract hours after an employee reports to work, cancel a shift, or do not call an employee in for an on-call shift (among others).

There are many exceptions to when predictability pay is required. For example, there is no obligation to issue predictability pay where employees request changes to their own schedule (in writing), agree to swap shifts, or have shifts taken away for disciplinary reasons. Most important, employers may call on employees who have consented to include be on a “voluntary standby list” when additional coverage is needed. Employees who agree to work when called from the voluntary standby list will not be entitled to predictability pay.

Right to Rest Between Work Shifts

Employees cannot be scheduled to work within 10 hours after the end of a prior calendar day’s work shift or on-call shift, or within 10 hours of a shift that spanned two calendar days, absent the employee’s consent or request to do so. Regardless of whether employees request or consent to work such shifts, they must be paid time and a half for any shifts separated by less than ten hours. However, the rule does not apply to “split shifts” on the same calendar day (e.g., employee takes a break between morning and evening shift).

Record Retention Requirements

Employers must retain records relating to this scheduling law for three years. Such records include: (1) the written work schedules given to employees and posted; (2) employees’ written requests to change their work schedule after the schedule has been posted; (3) the good faith estimate of employees’ work schedules, given to employees; (4) the voluntary standby list maintained by the employer, if any; (5) the employer’s notice to employees about any voluntary standby list and their rights to be included; and (6) documents showing just cause to subtract employees’ work hours for any disciplinary purposes.

Changes from the Proposed Rules

The Final Rules contain few changes from the Proposed Rules issued in April. Notable modifications include:

When the statute says that employers can avoid paying additional compensation for coverage needed to address unanticipated customer needs or unexpected absences, and references contacting “all of the employees listed on the voluntary standby list” – it only means those employees on the voluntary standby list “who are qualified and trained to perform the work for which the additional shift is offered.” This is a new definition from the Proposed Rules. It makes clear what should be common sense: employers do not need to call unqualified or untrained workers to fill-in for a shift to avoid paying additional compensation.
The Final Rules eliminate a proposed rule regarding joint employers – which would have relied on the joint employment standards in Title 29, CFR Part 791, Section 2 and Part 825, Section 106 (the Fair Labor Standards Act and the Family and Medical Leave Act).

Civil Penalties

Oregon also published its Final Rules regarding the civil penalties to be imposed for violations of the employee scheduling law. Civil penalties will not be imposed until after January 1, 2019. Generally, the penalty for a scheduling violation cannot exceed $1,000, with the penalty for failing to display the required notice to employees not exceeding $500. The penalty for coercing employees to be added to the voluntary standby list, however, is steeper – with a maximum of $2,000.

Employers impacted by Oregon’s new employee scheduling law should review the Final Rules and enacted legislation, and compare the provisions with their current scheduling practices to ensure compliance in advance of the July 1 effective date. Employers should also ensure they have sufficient recordkeeping practices in place to record employee schedule modifications, and prepare any voluntary employee standby list (an advisable practice).