HB 4094 – Requires employers who provide paid vacation time to compensate employees for all earned or accrued but unused paid vacation time when employment terminates.

Key Provisions:

1. Mandatory payout: Employers must compensate employees at 100% of their regular pay rate for all earned/accrued but unused paid vacation time when employment ends, following the same timeline as final wages under ORS 652.140.
2. Employer flexibility: Employers can still establish policies for:
   • How vacation time is earned or accrued
   • How employees request and schedule vacation

1. • Use-it-or-lose-it deadlines (with 90-day notice and reasonable opportunity to use time before forfeiture)
2. Amendment to wage law: Final wages now explicitly include earned/accrued unused paid vacation time (except in business sale scenarios where the new employer credits the time).
3. Effective date: The law applies to vacation time earned on or after 91 days following the legislative session’s adjournment, and to contracts entered/renewed after that date.

The bill essentially makes it illegal for Oregon employers to allow employees not to take vacation and not get compensated for the benefit when terminating.

Exemptions are:

• Employment covered by collective bargaining agreements that provide otherwise for payment of wages upon termination (government already pays out vacation time)
• Business sales where the new employer credits the accrued vacation time.