In the wake of the Covid-19 pandemic, the Oregon legislature amended the definition of “compensation” in the Oregon Equal Pay Act to temporarily exempt hiring/signing and retention bonuses from the limitations imposed by the Act. The temporary exemption, however, expires on September 28, 2022.
This means that starting September 28, 2022, hiring/signing/retention bonuses will once again be considered “compensation” under the Act. Under that law, employers must ensure that employees performing “work of comparable character” receive equal “compensation,” unless the difference is justified by specific “bona fide factors” listed in the statute. So if one employee receives a bonus but another does not, you must be able to distinguish between the two employees either:
- On the grounds that they are not performing “work of comparable character”; or
- By one of the specific “bona fide factors” in the Act.
In sum, if you began paying signing or hiring bonuses during the pandemic, and/or paid retention bonuses during this time, be aware that the “safe zone” which existed during the temporary lifting of the definition is coming to an end. Starting September 28, 2022, paying a signing or retention bonus could result in employees who perform the same jobs being paid differently – which could be a violation of the Act. You can read more about the Act here, and if you have any questions about how this affects your business, feel free to contact us.