Historic Minimum Wage Increase in Oregon

February, 2016


By Jenna Reed, JD, MBA, General Counsel and Director, Compliance Services
Cascade Employers Association
[email protected]

After much debate, late last week the Oregon Legislature passed Senate Bill 1532 which significantly increases Oregon's minimum wage. This bill establishes a tiered system with three different minimum wage rates and increase schedules based on three geographic regions. Governor Brown is expected to sign this legislation quickly, setting the stage for the first series of increases on July 1, 2016.

Under the new system, three minimum wage rates will be established across the state by geographic regions and gradually increase through 2022. The designated rate regions are the Portland Urban Growth Boundary, nonurban counties (Baker, Coos, Crook, Curry, Douglas, Gilliam, Grant, Harney, Jefferson, Klamath, Lake, Malheur, Morrow, Sherman, Umatilla, Union, Wallowa and Wheeler) and the base rate which is everything that falls outside the first two.

On July 1, 2016 the first series of increases will take effect increasing the state base rate from $9.25 to $9.75. Employers in the Portland Urban Growth Boundary region will also increase to $9.75, while employers in non-urban counties will be required to increase their minimum wage to $9.50. By 2022, the state base rate will be $13.50, $14.75 in the Portland Urban Growth Boundary and $12.50 in nonurban counties. After 2022, the minimum wage rates will be tied to the Consumer Price Index.

The rate and increase schedule is as follows:

Effective Date
State Base Rate
Nonurban Counties
Portland Urban
Growth Boundary
July 1, 2016 - June 30, 2017
$9.75
$9.50
$9.75
July 1, 2017 - June 30, 2018
$10.25
$10.00
$11.25
July 1, 2018 - June 30, 2019
$10.75
$10.50
$12.00
July 1, 2019 - June 30, 2020
$11.25
$11.00
$12.50
July 1, 2020 - June 30, 2021
$12.00
$11.50
$13.25
July 1, 2021 - June 30, 2022
$12.75
$12.00
$14.00
July 1, 2022 - June 30, 2023
$13.50
$12.50
$14.75

The Bureau of Labor and Industries will be developing rules related to this new law, including how employers can determine which geographic region they fall into in order to determine the appropriate minimum wage rate.

Cascade will continue to keep you updated on this very important issue. In the meantime, do not hesitate to contact us with any questions you have.

 

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