Employment Law Update

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By Lori Cooper

During Oregon’s 2025 legislative session, a fresh batch of laws were passed that cover the gamut from hiring practices to leave policies to pay disclosures. To help you stay ahead of the latest requirements, let’s take a quick look at of the biggest changes and how you’ll want to address them.

HB 3187 — Don’t Ask What Year an Applicant Graduated!

Effective: September 26, 2025
That seemingly innocuous “So, what year did you graduate?” question could soon land you in hot water. Oregon’s new law prohibits employers from asking about age, birthdates, or graduation years before the interview stage. The only exceptions are where this information is a bona fide job requirement or is needed to comply with legal mandates.

Suggested Action:

  • Remove birthdate or graduation-related fields from applications and recruiting software.
  • Avoid graduation-year or age-related questions on applications and in interviews.
  • Document the bona fide occupational qualification or legal mandate compliance if age-related disclosure is required.

HB 2248 — BOLI “Help Desk”

Effective: September 26, 2025
BOLI has a new Employer Assistance Division, which is like a hotline for advisory opinions and guidance. Your chats with them are confidential (unless you decide to share) and can shield you from penalties (except for remedies or penalties owed directly to employees) if you rely on their advice in good faith.

It’s important to remember that BOLI’s guidance is not legal advice – it can be a helpful resource, but it usually won’t replace the tailored advice you need for complicated or potentially high-risk situations.

Suggested Action:

  • Don’t hesitate to ask BOLI for guidance when you’ve got a question.
  • Retain documentation of reliance on BOLI guidance.
  • For legal strategy and compliance, call the Local Government Law Group.

SB 906 — Payroll Transparency 101

Effective: January 1, 2026
Starting in 2026, employers must give every new hire a clear guide to their earnings and deductions — basically, an explanation of what is on their pay stub and why. You can distribute it to employees via paper, post it (in the breakroom, etc.), or share it electronically (via email or link). You also have to review and refresh the info by January 1 every year.

Here is the information required in the disclosure:

  • Your regular pay periods.
  • Every pay type an employee might earn (hourly, salary, shift differentials, piece rates, commissions, etc.).
  • All benefit contributions and deductions.
  • Every type of deduction and what it’s for.
  • Any allowances (like meals or lodging) that count toward minimum wage.
  • Employer-provided benefits shown as contributions/deductions.
  • Payroll codes — plus a description or definition for each one.

That’s quite a list — but BOLI has created a template  in English and Spanish that you can use so you  don’t have to start from scratch.

Suggested Action:

  • Adopt BOLI’s template (or build your own customized version).
  • Make sure all the required elements are covered and easily understood.
  • Refresh the disclosure annually by January 1.

SB 1108 — Sick Time for Donating Blood

Effective: January 1, 2026
To encourage this life-saving activity, a new law allows employees to use sick time to donate blood.

Suggested Action:

  • Add “blood donation” to the list of sick time uses.

Managing Wage Overpayments: Putting SB 968 and ORS 652.610 Into Practice

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By Neil Taylor

Introduction and Practical Guidance on SB 968 (2025 Session)

As we move into 2026 and begin implementing new legislative requirements, it’s worth taking a fresh look at the payroll practices that support your workforce and protect your organization. Oregon enacted SB 968 (now codified at ORS 652.625), effective January 1, 2026, which establishes a clear statutory process for public employers to recover erroneous wage overpayments from public employees. Previously, BOLI treated wage deductions (even those voluntarily agreed to by the employee) to recoup overpayment of wages as an unlawful deduction.  This new law changes that and allows public employers a much easier method to recoup overpayments.

1.   SB 968 Now Governs Overpayment Recovery for Public Employers

SB 968 applies to public employers and public employees as defined in ORS 243.650. It repeals ORS 292.063 (wage deductions related to state employees) and replaces it with a detailed, mandatory process for recovering erroneous wage overpayments.

Under the legislation, a public employer may deduct an overpayment from a public employee’s wages only if all of the following requirements are met:

A.  The overpayment must be recent.

The overpayment must have occurred within the 364‑day period immediately before the employer provides the required written statements.

B.   The employer must provide advance written notice.

The employer must provide the required written statements at least 10 calendar days before making any deduction.

C.   The employer must provide three specific written statements.

  1. Itemization of the overpayment: A written statement itemizing the overpayment amount and the purpose of each deduction.
  2. Deduction cap: A written statement explaining that no deduction may exceed five percent of the employee’s gross pay per pay period, unless the employee requests and specifies a higher amount.
  3. Final paycheck recoupment: A written statement informing the employee that, if they separate from employment, the employer may recoup the remaining balance from the final paycheck.

D.  Collective bargaining agreements still control where applicable. 

For employees covered by a CBA, overpayment recovery is likely governed by the terms of that agreement. Consult your labor attorney if your CBA includes a repayment allowance greater than SB 968’s five percent cap.

2.   ORS 652.610 Continues to Govern All Other Wage Deductions

ORS 652.610(3) applies to all employers, including public employers, and prohibits withholding, deducting, or diverting any portion of an employee’s wages unless one of the following applies:

  • The deduction is required by law.
  • The employee voluntarily authorizes the deduction in writing, the deduction is for the employee’s benefit, and the deduction is recorded in the employer’s books and records.
  • The employee voluntarily authorizes a deduction for another item, so long as the employer is not the ultimate recipient and the deduction is recorded.
  • The deduction is authorized by a collective bargaining agreement.
  • The deduction is authorized under ORS 18.736.
  • The deduction is made from final wages to repay an employer loan, pursuant to a written agreement.

3.   How SB 968 and ORS 652.610 Interact

A.  If the deduction is for an overpayment → SB 968 controls.

Public employers must follow SB 968’s requirements. If they do, no employee authorization is required. Employers should also follow any relevant provisions of a CBA.

B. If the deduction is for anything else → ORS 652.610 controls.

Most deductions require written authorization, unless another statutory exception applies.

C.  If an overpayment deduction does not meet SB 968’s requirements.

The employer cannot fall back on ORS 652.610 to make a wage deduction unless authorized by a collective bargaining agreement. The employer must either seek other repayment options other than wage deductions or pursue other lawful recovery methods (e.g., civil action).

4.   Use This Change to Strengthen Communication and Internal Controls

Overpayments often stem from timing issues, late approvals, or misapplied pay codes. SB 968’s notice and documentation requirements encourage employers to slow down, communicate clearly, and ensure accuracy before deductions begin. Consider developing standard templates for overpayment notices and repayment agreements to streamline compliance.

5.   Align Your Policies and Practices Before the Effective Date

If your entity maintains its own personnel policies or payroll procedures, update them to reflect SB 968’s requirements. Ensure HR, payroll, and supervisors understand the new timelines, documentation standards, and deduction limits. For unionized employees, confirm that your practices align with the applicable collective bargaining agreement.

6.   We’re Always Here to Assist

As always, our team remains available to help review your policies, answer implementation questions, and support your transition to the new statutory framework.