Oregon Alters “No-Rehire Provisions” in Workers’ Compensation Settlements

Oregon has passed House Bill 3471, effective now, which addresses “no-rehire provisions” that are sometimes included in settlement agreements for workers’ compensation claims. These provisions prevent workers from seeking future employment, reemployment, or reinstatements with the same employer. 

Key Points of the Bill

  1. New definitions of terms:
    • “No-rehire provision” is any provision in an agreement preventing a worker from seeking further employment or reemployment with the original employer.
    • “Settlement agreement” is a settlement agreement resolving all or part of a workers’ compensation claim under ORS Chapter 656
    • “Worker” is an individual worker who has applied for benefits or invoked or utilized procedures under ORS Chapter 656.
  2. Employers cannot make offers for settlement agreements contingent on a worker agreeing to a no-rehire provision, unless:
    • The worker has already confirmed in writing their willingness to consider a no-rehire provision. 
    • The settlement offer explicitly states the inclusion of the no-rehire provision. 
  3. If the conditions in point 2 are met, it is not a violation:
    • For any party to make or reject a settlement offer with a no-rehire provision.
    • For employers to require a no-rehire provision as part of the settlement agreement.
  4. Employers can include a no-rehire provision if:
    • The worker hasn’t provided written confirmation, and
    • The offer clearly states it’s not conditional upon agreeing to the no-rehire provision.
  5. Workers can file complaints for violations and may bring a civil action. Violators can face a civil penalty up to $5,000 and other reliefs.

The Act takes immediate effect due to its declared emergency status, meaning it’s deemed essential for public peace, health, and safety.