October 2025
Cascade Compliance Team
compliance@cascadeemployers.com
On October 1, 2025, the federal government officially shut down after Congress failed to pass funding legislation, pausing a range of non-essential government services. This shutdown has significant implications on federal contractors, as well as trickle-down effects on private employers.
Potential Layoffs
Employers facing potential layoffs due to the shutdown must be mindful of notice requirements:
Additionally, both the Federal and Washington WARN Acts have a potential "unforeseen circumstances" exception. Employers should immediately and carefully analyze whether the government shutdown qualifies for this exception if they anticipate needing to implement sudden layoffs.
Business Shutdowns
For employers considering partial or full-week business shutdowns, specific wage and hour laws apply depending on the employee’s classification. It is important to note that for exempt employee salary deductions, both Washington and Oregon generally follow the same rules as federal law.
For non-exempt employees, employers are only required to pay them for the actual hours worked. However, exempt employees must receive their full salary for any week in which they perform any work, regardless of the number of days or hours worked. Therefore, salary deductions depend entirely on the shutdown's length and whether any work was performed during that period.
Full-Week Business Shutdowns
For a full week shutdown where no work is performed, employers are not required to pay exempt employees their salary. Employers can require exempt employees to use Paid Time Off (PTO) for these shutdowns.
Partial-Week Business Shutdowns
For a partial-week shutdown, employers must pay exempt employees their full salary, even if the employee only worked, for example, one hour that week. While employers can require the use of PTO, if an employee's PTO is exhausted, the employer cannot deduct from their guaranteed weekly salary.
Regulatory and Investigative Delays
The government shutdown will significantly slow the enforcement and investigatory roles of Department of Labor (DOL), Equal Employment Opportunity Commission (EEOC), and National Labor Relations Board (NLRB) due to all non-essential staff being furloughed. Because of this, nearly all non-urgent ongoing and new cases, audits, and investigations (including workplace, wage and hour, discrimination, or union-related claims) are typically paused or significantly slowed. Additionally, agencies will not issue new guidance or rulemaking during this time.
E-Verify Interruptions
For employers enrolled in E-Verify for I-9s, be aware that the system is typically taken offline during a government shutdown. This means you cannot create new E-Verify cases, manage existing cases, or resolve Tentative Nonconfirmations (TNCs). The U.S. Citizenship and Immigration Services (USCIS) responds by temporarily removing the three-day E-Verify case submission rule and extending deadlines for addressing TNCs. It is important to remember that employers cannot take adverse action against employees with unresolved E-Verify cases due to system unavailability.
Additionally, even though the requirement to create the E-Verify case is suspended while the system is down, employers are still required to complete the I-9 document examination (physical or remote alternative) on time. For remote employee verification, E-Verify employers in good standing can still use a permanent remote I-9 process that includes a live video session to examine employee documents.
Cascade will continue to monitor this and its impacts on the workplace. Never hesitate to reach out if you have any questions.
Cascade Compliance Team
compliance@cascadeemployers.com
The IRS plans to introduce new guidance and forms for the 2026 tax year, including guidance on how overtime and tips will need to be reported. As a first step, the IRS has released a draft of the W-2 form. This is just a draft and should not be used but provides some initial insights on what changes may be ahead. The IRS also announced that in early October it will publish a list of occupations that may be eligible to take advantage of the tax break.
Earlier in August, the IRS announced that there will be no changes to individual information returns or withholding tables for the 2025 tax year. This means employers and payroll providers should continue using current procedures for Forms W-2, 1099, and 941, as well as federal income tax withholding tables. This decision is part of the phased implementation of the "One, Big, Beautiful Bill Act" and is intended to prevent disruptions.
Cascade will continue to monitor this and keep you updated.
Cascade Compliance Team
compliance@cascadeemployers.com
The Oregon Bureau of Labor and Industries (BOLI) has published its model payroll notice template to help employers comply with SB 906. As a reminder, SB 906 takes effect January 1, 2026, and creates new payroll disclosure requirements for Oregon employers.
It is worth noting that this new law does not change Oregon’s existing paystub requirements. Employers must still provide detailed paystubs each payday. SB 906 adds a separate written payroll notice that must be provided at hire and updated annually by January 1st. The notice must include information such as pay periods, pay rates, deductions, benefit contributions, payroll codes, and any wage allowances.
Employers can meet the notice requirement by making the information easily accessible, such as by posting it in a central location, sharing an electronic file, providing a website link, or sending it by email. The notice must clearly explain pay rates and deduction codes, but it does not need to be written in complete sentences.
BOLI’s template is available in English and Spanish, with additional language translations available upon request. Employers may use and customize this model to meet their obligations.
Oregon employers should review BOLI’s template and prepare their own payroll disclosure notice before the January 1st deadline. Penalties for noncompliance are $500 per violation.
Cascade Compliance Team
compliance@cascadeemployers.com
On September 29, 2025, during a special session, the Oregon Senate passed HB 3991, a transportation funding bill projected to raise $4.3 billion over the next ten years. One of its direct impacts on employees is the doubling of the Payroll Transit Tax, which is a payroll deduction taken from all Oregon workers. Beginning January 2026, the Payroll Transit Tax increases from 0.1% to 0.2%. For an Oregon employee earning $70,000, this means $140 per year will go toward public transit, compared to $70 currently.
Additional effects of the bill include:
Employers with company vehicles should expect operating expenses to rise due to these increased costs.
Regarding the Payroll Transit Tax, Oregon employers should plan to notify employees before January 1st to explain it's a mandatory statewide change and not an employer-made deduction.
Cascade Compliance Team
compliance@cascadeemployers.com
Effective October 1, 2025, temporary staffing agencies in Washington must collect retail sales tax on temporary staffing services, following the passage of SB 5814. Previously, sales tax depended on the work performed by the temporary staff, with some job functions being exempt. Under SB 5814, temporary staffing agencies must generally collect sales tax and report gross income from all qualifying services as retail, regardless of the specific tasks performed.
Temporary staffing services are defined as providing workers to other businesses for short-term periods to supplement the workforce or fill vacancies on a contract or fee basis. Agencies must:
Temporary staffing agencies that provide personnel to hospitals licensed under RCW 70.41 or 71.12 are exempt from certain requirements. However, the tax treatment for these agencies is still determined by the specific nature of the services they deliver within the hospital environment.
Employers using staffing agencies for Washington work should expect to see sales tax applied to invoices starting October 1. Employers may want to review contracts and budget for the added cost.
Cascade Compliance Team
compliance@cascadeemployers.com
The following Oregon Employment laws went into effect on September 26th:
Restrictions on Age-Related Hiring Inquiries (HB 3187)
New Requirement: Employers are now generally prohibited from asking applicants for their age, date of birth, or dates of attendance/graduation from an educational institution.
Note: This information cannot be requested until after the initial interview is completed, or after a conditional job offer if no interview is conducted. This shift aims to prevent age-related bias early in the hiring process.
Paid Leave Oregon (PLO) Return-to-Work Certification (SB 69)
New Requirement: Employers with a uniformly applied policy can now require an employee returning from PLO medical leave (for their own serious health condition) to provide a fitness-for-duty certification from their healthcare provider before being reinstated.
Oregon Family Leave Act (OFLA) Amendments (SB 69)
New Requirements: OFLA was updated to provide:
Cascade Compliance Team
compliance@cascadeemployers.com
Question: One of our employees was using their personal cell phone during a break to look at sexually explicit websites with another co-worker. Since it was during a break and on their personal phone, as an employer, do I have any authority to do anything?
Answer: Yes, employers have authority and a legal obligation to address this type of conduct, even if it happens during a break and on a personal device. Conduct involving sexually explicit material at the workplace most likely violates company policy and can contribute to a hostile work environment. If the activity occurs on employer premises or could reasonably affect other employees, regardless of time and location, the employer should intervene to ensure a respectful and harassment-free workplace.
By Sheryl Kelsh, Membership Development Manager
skelsh@cascadeemployers.com
One of the best parts of my role at Cascade is getting to know our members and the incredible products and services they bring to their communities. I recently had the pleasure of discovering Toby’s Family Foods, a Eugene-based company with deep local roots—and I’ve quickly become a fan, especially of their crave-worthy Original Spread.
If you’re not familiar with them, here are five things you might not know about this standout Oregon brand:
It all started in a mom’s kitchen in Eugene
In the 1970s, single mother Toby Alves was searching for wholesome, allergy-friendly foods she could serve her children. She began making simple, plant-based recipes from scratch in her home kitchen in Eugene, Oregon. What started as personal necessity quickly became a community favorite. Her tofu-based dips and spreads gained popularity at the Eugene Saturday Market under the name “The Tofu Palace,” and by 1978, Toby’s Family Foods was officially born.
Their Original Spread is a local staple
Toby’s tofu-based Original Spread is more than just a product—it’s a part of the culinary identity of the Pacific Northwest. Made from organic tofu, fresh vegetables, and a blend of herbs and spices, this creamy, protein-rich spread has remained nearly unchanged since its debut. Generations of Oregonians have grown up enjoying it as a sandwich spread, veggie dip, or salad topper.
Pioneers in High-Pressure Processing (HPP)
Toby’s was one of the first three companies in the Americas to adopt High-Pressure Processing (HPP), a cold pasteurization method that eliminates harmful bacteria without the use of heat. This innovation enabled them to preserve the flavor and nutritional quality of their fresh products while extending shelf life—a feature particularly important for natural, preservative-free foods.
They revived a beloved juice brand
In the early 2000s, an Eugene-based raw juice brand named Genesis Organic Juice faced regulatory challenges. Toby’s acquired Genesis Juice and relaunched the brand using its advanced HPP technology to safely process the juice while maintaining its raw, cold-pressed integrity. Today, Toby's still handcrafts Genesis Organic Juice locally at the Toby’s facility in Springfield, Oregon.
A legacy of leadership and local values
Although Toby Alves passed away in 2022, her legacy continues through her son Jonah Alves and the dedicated team at Toby’s Family Foods. The company remains deeply rooted in the Eugene community, with many women in key leadership and ownership roles. They continue to prioritize local sourcing, non-GMO ingredients, and sustainable practices. Their products are now sold nationwide, but their heart remains firmly in Oregon.
Toby’s Family Foods is more than a brand—it’s a story of innovation, resilience, and deep local pride. To find out where you can purchase their great products, visit their store locator.
Cascade is pleased to have the opportunity to feature Toby’s Family Foods as an outstanding member and employer.
