Oregon’s 2026 short legislative session is underway, and a few proposed bills could affect employers of all shapes and sizes. Although short sessions move quickly, they often include important policy changes, particularly in the labor and employment space. Below is an overview of three bills that Oregon employers should monitor closely.
HB 4089 – Criminal Penalties for “Wage Theft”
HB 4089 would amend Oregon’s criminal “theft of services” statute, ORS 164.125 (the law that criminalizes, for example, intentionally walking out of a restaurant without paying the tab) to include an employer’s failure to pay employees’ wages.
Criminal liability would attach no matter how large or small the amount of wages. However, the criminal penalties for a violation would depend on the amount of the wages at issue; at the high end (the failure to pay wages of $10,000 or more), the violation would treated as a Class B felony, which under Oregon law carries a jail sentence of up to 10 years. As drafted, it appears that only the “employer” (typically, an entity like a corporation or a limited liability company) would be subject to criminal liability, but the vague definition of “employer” in the bill raises the prospect of individual employees (supervisors, managers, or payroll staff) facing criminal liability. Criminal liability is in addition to whatever rights an employee might have to pursue a civil claim for unpaid wages and penalties, for example, a private lawsuit filed in court or an administrative charge filed with the Oregon Bureau of Labor and Industries (BOLI).
HB 4089 represents a significant and frankly dangerous expansion of liability for Oregon employers. As most employers know, the complexity of the wage-and-hour laws and the cornucopia of unique factual circumstances that arise in the employment relationship make compliance in this area extremely challenging. In short, mistakes happen even for diligent employers. In addition, there are already myriad civil penalties for failure to timely and accurately pay wages. It is not clear whether the sponsors of the bill appreciate these challenges or the practical problems with imposing criminal liability on employers for good faith mistakes. We encourage you to contact your legislator to express these concerns.
HB 4093 – Employee Representatives in Disability-Accommodation Meetings
HB 4093 would amend Oregon’s disability laws (specifically, ORS 659A.118) to require employers to allow employees to bring a representative—potentially a coworker, a union representative, an attorney, or any other individual of their choosing—in “any discussion over matters concerning reasonable accommodation.” An employer’s refusal to allow an employee to bring a representative to such a meeting could expose the employer to civil liability under ORS 659A.112, which allows an employee to initiate a private lawsuit for damages if the employer violates ORS 659A.118 or other aspects of Oregon disability law (for example, the duty to provide a reasonable accommodation).
There are a host of practical issues the bill does not address. For example, as many employers know, disability accommodation discussions often occur informally and over the course of an extended period of time. Is the employee entitled to bring a representative to each such discussion, no matter where (on the shop floor, in a private office , etc.) or how often they occur? If the employee’s representative is disruptive or uncooperative during the meeting, may the employer excuse the representative and proceed with a direct discussion with the employee? Is the employer required to allow the representative to be physically present in the workplace for the discussion?
As with HB 4089 and the wage-and-hour issues it seeks to regulate, it is unclear whether the sponsors of HB 4093 appreciate how the disability accommodation process actually plays out in practice. We encourage employers to contact their legislators and to discuss these issues with them in depth.
HB 4094 – Mandatory Payout of Unused Vacation upon Termination of Employment
Under current Oregon law, an employer that chooses to provide employees with paid vacation time is not required to pay the employees the value of their unused time upon termination. Instead, whether to pay out the value of unused vacation is a matter of employer policy. HB 4094 would change this, specifically, it would amend Oregon’s final paycheck law, ORS 652.140, to require that employers pay out the value of unused vacation time upon termination of employment. The bill would allow employers to impose caps on employees’ vacation accrual and would not require that employers pay out the value of unused paid sick time or other categories of paid time off. If passed, the payout obligation will apply on a prospective basis to vacation time that accrues following the bill’s effective date.
Although many employers (particularly non-profit organizations) pay employees for their unused vacation upon termination, many do not and requiring them to pay the value of unused vacation time upon termination adds a potentially significant financial expense to their bottom line. For that reason, if HB 4094 becomes law it may have the perverse effect of incentivizing employers to provide their employees with less vacation time than they would otherwise in order to limit their financial liability.