By Emily Shultz

On Thursday, the Oregon House of Representatives approved landmark legislation (Senate Bill 1532) which raises the state's minimum wage rate to the highest in the United States, and does so through an unprecedented tiered system based on where Oregon residents work.  The bill now heads to Governor Kate Brown, who has already indicated that she will sign it into law. 

A product of heated debate and compromise between the interests of unions, businesses and farmers, the plan imposes a series of gradual increases over six years.  By 2022, the state's current $9.25 an hour minimum wage - already one of the highest in the nation - would climb to $14.75 in metro Portland, $13.50 in cities such as Salem, Eugene, and Bend, and $12.50 in rural communities.  Below is a timeline of the planned minimum wage increases for each designated geographic “tier”:

Tier 1 (the Portland urban growth boundary):
July 1, 2016: $9.75
July 1, 2017: $11.25
July 1, 2018: $12
July 1, 2019: $12.50
July 1, 2020: $13.25
July 1, 2021: $14
July 1, 2022: $14.75

Tier 2 (Benton, Clackamas, Clatsop, Columbia, Deschutes, Hood River, Jackson, Josephine, Lane, Lincoln, Linn, Marion, Multnomah, Polk, Tillamook, Wasco, Washington and Yamhill Counties):
July 1, 2016: $9.75
July 1, 2017: $10.25
July 1, 2018: $10.75
July 1, 2019: $11.25
July 1, 2020: $12
July 1, 2021: $12.75
July 1, 2022: $13.50

Tier 3 (Malheur, Lake, Harney, Wheeler, Sherman, Gilliam, Wallowa, Grant, Jefferson, Baker, Union, Crook, Klamath, Douglas, Coos, Curry, Umatilla and Morrow Counties)
July 1, 2016: $9.50
July 1, 2017: $10
July 1, 2018: $10.50
July 1, 2019: $11
July 1, 2020: $11.50
July 1, 2021: $12
July 1, 2022: $12.50
 
The federal minimum wage continues to be $7.25/hour. Because employers must pay the higher of the federal minimum wage or the state minimum wage, the state minimum wage will continue to control in Oregon (and Washington, where the 2016 minimum wage rate is $9.47/hour). 
 
We will continue to monitor wage and hour developments. Please feel welcome to contact Bullard Law with any questions regarding minimum wages or other labor, employment and employee benefits issues.