Oregon Paid Family Leave

Background 

The state of Oregon’s Paid Family Leave (PFL) program took effect in 2023. Employees and, if applicable, employers fund the Paid Family Leave program. All employers are responsible for withholding premiums from employee wages. Employers with 25 or more employees must also contribute. You may be exempt from participating if you offer a private paid family leave plan to employees that the Oregon Employment Department has approved.

Contributions for PFL began on January 1, 2023. Eligible employees were able to start applying for benefits on September 3, 2023.

For more information, check out the Paid Leave Oregon website or view our blog article “Oregon Paid Family Leave: Everything You Need to Know About the New Law.” 

Patriot Software will calculate this tax for all payroll customers, and collect, deposit, and file this tax for Full Service Payroll customers. 

How much is the Oregon PFL premium?

Both employees and employers with 25 or more employees contribute an Oregon PFL premium, split 60/40:

• The total combined tax rate for 2024 and 2025 is 1.0% per employee. 
• You can withhold up to 60% of 1% (i.e., 0.60%) from each employee’s wages, up to federal Social Security taxable wage maximum. You can decide to pay part or all of the employee share.  
• If you have 25 or more employees, contribute 40% of 1% (i.e., 0.40%) up to federal Social Security taxable wage maximum. If you have fewer than 25 employees, you can choose to contribute 0.40% for an assistance grant. 

To determine if you have 25 or more employees (including out-of-state employees), use your monthly employee counts for the previous year. Monthly employee counts are based on the number of employees on your payroll for the pay period that includes the 12th of the month. Add together your monthly employee counts for January – December and divide by 12 to get your average count. If the average is 25 or more, you are responsible for the full 1.0%. 

Here’s a breakdown of Oregon PFL premiums:

Setting up Oregon PFL

To add or edit the OR PFL go to Settings > Payroll Settings > Paid Family and Medical Leave > Oregon tab.

Are you required to pay the 40% employer share of the Oregon Paid Leave contribution?

• Choose “Yes” if you have 25 or more employees. You are required to contribute the employer’s share of the premium unless you have an approved plan. If you do have an approved plan, select “No, I am exempt.”
  
  If you select “Yes,” you will be asked, “Do you want to pay more than the minimum required employer share?”
  • If you want to pay more than the 40% employer share of 1.0%, select “Yes.” Then, choose your desired percentage of employer and employee contributions.  
  • If you want to pay the 40% employer share of 1.0% (i.e., 0.40%) per employee, select “No.” 
• Choose “No, I am exempt” if you have fewer than 25 employees or if you have an approved plan by the state. You are not required to contribute the employer share of the premium. 
  
  If you select “No, I am exempt,” select the reason in the drop-down and the “effective date” or date that you became exempt or have implemented your state-approved plan. 
  • Less than 25 employees – you must still collect and remit the employees’ share of premiums and meet reporting requirements. 
  • Approved Alternative – No calculations will be made for this tax for the company or employees. No reporting will be submitted. 
    

You will also be asked two questions:

1. “Would you still like to pay the employer portion of the tax?”
   • If you want to pay the employer portion for an assistance grant, select “Yes.” Then, choose your desired percentage and click “Save.”
   • If you do not want to pay the optional employer portion, select “No” and click “Save.”
2. “Do you want to pay a portion of the employees’ contributions?”
   • If you want to pay part of your employees’ 0.60% tax rate, select “Yes.” Then, choose your desired percentage and click “Save.”
   • If you do not want to pay any part of the employee’s share, select “No” and click “Save.”

In either case, you must still collect and remit the employees’ share of premiums and meet reporting requirements. 

Employee Exemptions from Oregon Paid Family Leave

You may have some employees who are exempt from withholding. 

Go to Payroll > Employee List > Select Employee Name > Advanced Tax Settings > Oregon Paid Leave. 

Click the “Add Oregon Paid Leave Exemption Status” button and change to “Exempt.” Add the date the exemption began and click “Save.”

This will prevent the employee and corresponding employer’s share of tax from calculating for this particular employee.

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