State Will Employ Three Different Regional Minimum Wages

In a first-of-its-kind development, the Oregon legislature passed and the Governor will sign into law a minimum wage hike law that will go into effect July 1, 2016. Under the new law, the rates will steadily increase through 2023, eventually giving Oregon the highest minimum wage rates in the nation.

For the first time in Oregon history, employers will pay different minimum wage rates depending on the part of the state in which they are located, with employers in Portland’s Urban Growth Boundary paying the most, employers in sparsely populated “frontier” areas paying the least, and a middle tier of all other employers in between. The details are as follows:

Click here to view table.

The law does not specifically explain how an employer should determine its location for purposes of paying minimum wage, or whether employees will be entitled to various wage rates if they travel through the state (or out of the state) as part of their jobs. Instead, the Commissioner of the Bureau of Labor and Industries has been given the authority to issue rules that will describe how that determination is to be made. We will update this Alert once the clarifying rules are finalized.

Several worker-advocacy groups have been collecting signatures on proposed ballot measures since last summer, seeking to raise the minimum wage for all Oregon workers; one would raise the state-wide minimum wage to $15.00 by 2019, and another would raise the rate to $13.50 by 2018. It remains to be seen whether passage of this law will dissuade advocates from continuing their efforts to include these proposals on the November ballot.