Linn, eight other counties and state continue court battle over paid sick leave

Audrey Caro Gomez

Linn County Circuit Court Judge Daniel Murphy ruled on Dec. 8 that Linn County and eight other counties could opt out of Oregon’s paid sick leave law because the law is an unfunded mandate.

Despite that ruling, both sides were in court again on Dec. 29. The state filed a motion for reconsideration because the court had not held a summary judgment hearing on the financial threshold issue relevant to the ruling.

“The fact that it is an unfunded mandate is not in dispute,” said Linn County Commissioner Roger Nyquist. “It’s whether the county meets that threshold.”

Oregon’s paid sick leave law, which was passed in 2015 and went into effect Jan. 1, has applied to employers who have 10 or more employees, with the exception of Portland, where the threshold is six.

Under the law, full-time, part-time, temporary and seasonal workers accrue sick time, according to the Bureau of Labor and Industries.

The financial threshold that must be met in order to opt out is one-hundredth of 1 percent of the county’s budget.

How that number is calculated was in dispute at the Dec. 29 hearing.

In September, Dave Alderman, Linn County accounting officer, stated in a court filing that the county has taken actions to implement the new law.

“We have modified our payroll system to meet the requirements of the new law, which increased the number of employees we accrue and track sick leave for by 154 employees,” Alderman said.

He said complying with the law required the county to “plan and implement a new procedure to track and set up non-employees in our payroll system when staffing is done through temporary staffing agencies.”

This process added several hours each month to payroll staff’s workload, he added.

Staff used the actual number of hours worked by part-time hourly staff in 2015 to calculate hours that would have been accrued, according to the document. The result was an additional 1,725 hours, with a value of $41,067.

“This amount is well above one-hundredth of 1 percent of the county’s 2016-2017 budget,” Alderman said.

Employees accrue one hour of sick time for every 30 hours worked and are eligible to use sick time after 90 days.

The state has obtained a qualified expert to calculate whether the counties will actually spend more than the financial threshold in order to comply with the sick leave law, said Carla Scott, who is representing Gov. Kate Brown.

“The statute is plain on it’s face,” Scott said. “Nothing in this act requires an employer to compensate an employee for accrued unused sick time upon the employee’s termination, resignation or retirement or other separation from employment.”

She added that ongoing material discovery is necessary to test the declarations submitted by the county.

Murphy asked Scott about the state’s declaration.

“Any time that a party wants to defeat a summary judgment motion, all they have to do is file a declaration saying we have secreted away in a back room an expert witness,” Murphy said.

“We’re not going to tell you who it is. We’re not going to tell you anything about him. You’re just going to have to take my word that we have one. And you’re going to have to take my word that their testimony is relevant and you’re going to have to take my word that their testimony is necessary to the case.

“And based on that, I wouldn’t hear any motions for summary judgment any more. It’d be over.”

He said he was trying to determine if there is a threshold showing that expert evidence is necessary.

“This is a complicated accounting question that is subject to how money is accrued or calculated on budget documents,” Scott said.” Complicated math will be required.”

The county is legally required to provide the benefit, said Nathan Rietmann, of Rietmann & Rietmann, LLP.

“I would note that under the legislation, the paid sick leave that is accrued, carries over,” Rietmann said. “So the law doesn’t become an unfunded mandate only when the plague hits one of these counties and everybody gets sick at once and uses their paid sick leave. It’s an unfunded mandate or not, based on what the law requires.”

Murphy asked about what happens when an employee does not claim his or her sick time.

Rietmann said it would continue to accrue.

“Well, they quit or they get fired or they die,” Murphy said.

The county would then be under no obligation to pay that person sick leave so the obligation goes away, he said.

“So how do we treat it in advance,” Murphy asked. “It sounds to me like a contingent obligation, not an absolute obligation.”

Rietmann said he did not think whether or not the law is an unfunded mandate should depend on when the employees happen to get sick.

He said under that theory, employees of the county could be healthy one year and not take any sick days; then the paid sick leave law is not an unfunded mandate.

“You get down the road to year number two and everybody’s sick leave has piled up and everybody gets sick and uses it, then suddenly an unfunded mandate,” Rietmann said. “We would submit that whether it’s an unfunded mandate or not depends on what the law requires.”

Murphy said he expected to have a decision within two weeks, but certainly within 30 days.

“I will try to get this to you as soon as I can but I want to make sure it’s thorough, so it could take the whole 30 days,” Murphy said.

In a conversation after the hearing, Nyquist said 2016 figures show an amount closer to $50,000.

The amounts for 2015, which were provided in Alderman’s statement to the court, and the amount for 2016, did not account for the length of employment and whether they were eligible or not.

Alderman said the figures he submitted in September were an estimate based on the data at that time.

“Liability for Linn County part time employees having paid sick leave would vary from month to month based on eligibility factors,” he said.