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83rd OREGON LEGISLATIVE ASSEMBLY--2025 Regular Session
Enrolled
Senate Bill 426
Sponsored by Senator PROZANSKI, Representative FRAGALA, Senator MANNING JR, Represen-
tative VALDERRAMA; Senators GOLDEN, MEEK, PATTERSON, PHAM K, REYNOLDS, Rep-
resentatives ANDERSEN, CHAICHI, CHOTZEN, GAMBA, GRAYBER, HUDSON, KROPF,
MUNOZ, NELSON, RUIZ, SMITH G, SOSA, TRAN (Presession filed.)
CHAPTER .................................................
AN ACT
Relating to wages.
Be It Enacted by the People of the State of Oregon:
SECTION 1.
Sections 2 and 3 of this 2025 Act are added to and made a part of ORS
chapter 652.
SECTION 2. (1) As used in this section and section 3 of this 2025 Act:
(a) “Authorized third party representative” means a third party that is authorized by an
unrepresented employee to assert the rights of the unrepresented employee.
(b) “Construction contract” means an express or implied agreement:
(A) For the construction, reconstruction, alteration, maintenance, moving or demolition
of any building, structure or improvement.
(B) Relating to the excavation of or other development of or improvement to land.
(c) “Construction trade labor organization” means a bona fide labor organization that
represents employees in the building and construction trades.
(d) “Direct contractor” means any person, including a construction manager, joint ven-
ture or any combination thereof, the person’s successors, heirs or assigns, that enters into
a construction contract with an owner.
(e) “Fringe benefit contributions” means the amount of compensation that accompanies
or is in addition to an employee’s regular salary or wages, including, but not limited to,
payments made to profit-sharing plans, retirement or pension plans, medical insurance,
severance pay or holiday, vacation or sick leave plans, but does not include the benefit pay-
ments from such plans.
(f) “Labor organization” means an organization, agency or an employee representation
committee or plan, in which employees participate and which exists, in whole or in part, for
the purpose of dealing with employers concerning grievances, labor disputes, wages, rates
of pay, hours of employment or work conditions.
(g)(A) “Owner” means any person, firm, partnership, corporation, association, company,
organization or other entity, or any combination thereof, with an ownership interest,
whether the interest or estate is in fee, as vendee under a contract to purchase, as lessee
or another interest or estate less than fee that causes:
(i) A building, structure or improvement, new or existing, to be constructed, recon-
structed, erected, altered, remodeled, repaired, maintained, moved or demolished; or
Enrolled Senate Bill 426 (SB 426-B)Page 1
(ii) Land to be excavated or otherwise developed or improved.
(B) “Owner” does not mean:
(i) A public agency, as defined in ORS 279C.800; or
(ii) A financial institution that acquires ownership of a property through foreclosure or
a deed in lieu of foreclosure, provided that the financial institution does not undertake,
contract for or direct construction work beyond activities necessary to preserve or secure
the property.
(h) “Subcontractor” means any person that may or may not have direct privity with a
direct contractor but that is a party to an express or implied contract with a direct con-
tractor or with a direct contractor’s subcontractors at any tier to perform any portion of
work within the scope of the direct contractor’s construction contract with an owner.
(i) “Unrepresented employee” means an employee of a direct contractor or subcontractor
who is:
(A) Not represented by a construction trade labor organization that has established itself
or its affiliates as the collective bargaining representative for persons performing work on
a project; or
(B) Not covered by a collective bargaining agreement that:
(i) Contains a grievance procedure that results in a final and binding decision; and
(ii) Provides a mechanism for recovering unpaid wages and fringe benefit contributions
on behalf of the employees covered by the agreement.
(2) An owner that enters into a construction contract with a direct contractor shall be
jointly and severally liable with the direct contractor for any unpaid wages, including fringe
benefit contributions and penalties, owed to any unrepresented employee of the direct con-
tractor and any unrepresented employee of a subcontractor at any tier for labor performed
on a project within the scope of the construction contract.
(3)(a) Any of the following persons may bring a civil action against an owner, a direct
contractor or a subcontractor in any court of competent jurisdiction to recover unpaid
wages, including fringe benefit contributions, interest and penalty wages, damages, attorney
fees and costs incurred in connection with the action:
(A) An unrepresented employee.
(B) An authorized third party representative.
(b) Notwithstanding ORS chapter 180, the Attorney General may accept the assignment
of claims under this subsection, bring civil actions in the name of the State of Oregon on
assigned claims and recover costs as provided in this section. The Attorney General may
adopt rules to implement this paragraph.
(c)(A) Prior to commencing a civil action against an owner or a direct contractor under
this subsection, a person must send written notice of the alleged violation by first-class
certified mail to the owner and direct contractor that sets forth the alleged violation and the
nature of the claim and states that the owner and the direct contractor have 21 calendar
days from the certified delivery date to correct the alleged violation. Such notice does not
operate to limit the liability of the owner or direct contractor or preclude a person from
subsequently amending a complaint after the action is commenced to include additional
parties to the action.
(B) A civil action may not be:
(i) Initiated until after the time period under subparagraph (A) of this paragraph has
expired.
(ii) Brought against an owner or a direct contractor if the owner or direct contractor
has corrected the alleged violation within the specified time period under subparagraph (A)
of this paragraph.
(d) A civil action under this subsection to recover unpaid wages must be commenced
within two years from the date on which the wages and fringe benefit contributions became
due.
Enrolled Senate Bill 426 (SB 426-B) Page 2
(4) Any agreement to waive or release an owner or direct contractor or to indemnify an
owner or direct contractor for liability assigned under this section is invalid.
(5)(a) An owner or direct contractor may not avoid liability under this section by claim-
ing that a person performing labor on a project within the scope of a construction contract
is an independent contractor rather than an employee of a direct contractor or subcontrac-
tor unless the person qualifies as an independent contractor under ORS 670.600.
(b) In any action brought under this section, there shall be a rebuttable presumption that
a person performing labor on a project within the scope of a construction contract is an
employee. The party claiming otherwise may rebut the presumption by establishing that the
person qualifies as an independent contractor under ORS 670.600.
(6) Nothing in this section impairs:
(a) The right of an owner or direct contractor to bring an action against a subcontractor
to seek recovery of actual and liquidated damages for the amounts paid by the owner or di-
rect contractor for unpaid wages, including fringe benefit contributions, interest and penalty
wages, damages, attorney fees and incurred costs associated with an action brought under
this section.
(b) The right of an owner to bring an action against a direct contractor to seek recovery
of actual and liquidated damages for the amounts paid by the owner for unpaid wages, in-
cluding fringe benefit contributions, interest and penalty wages, damages, attorney fees and
incurred costs associated with an action brought under this section.
(7) This section does not apply to the construction, reconstruction, alteration, mainte-
nance, moving or demolition of any building, structure or improvement, or to the excavation
or other development of or improvement to land, that relates to real property that is used
as the owner’s principal residence or to real property consisting of five or fewer residential
or commercial units on a single tract, as defined in ORS 215.010.
(8) Nothing in this section is intended to diminish the rights, privileges or remedies of
an employee under a collective bargaining agreement.
(9) The Commissioner of the Bureau of Labor and Industries may adopt any rules nec-
essary to implement the provisions of this section.
SECTION 3.
(1) Any subcontractor with which a direct contractor has entered into a
contract to perform a portion of a construction project within the scope of a construction
contract between the direct contractor and an owner shall provide the following records to
the direct contractor and the owner, upon the request, respectively, of the direct contractor
or the owner:
(a) Certified payroll reports, that, at a minimum, include sufficient information for the
direct contractor to determine whether a subcontractor has paid in full all wages earned by
unrepresented employees who performed work on the project as part of the employees’ total
compensation.
(b) The name, address and phone number of a contact for the subcontractor.
(c) The names of all workers who performed work on the construction project and no-
tation of whether each worker is paid or classified as an employee or independent contractor.
(d) The name of any subcontractor with which the first-tier subcontractor contracts.
(e) The anticipated contract start date and scheduled duration of work.
(f) An affidavit that attests to whether the subcontractor or any of the subcontractor’s
current principals have, within the preceding five years, participated in any civil, adminis-
trative or criminal proceeding involving a violation of any law providing for payment of
wages or imposing a criminal penalty for the violation and the outcome of the proceeding,
including damages, fees or penalty amounts paid to workers or a government agency, if any.
(2) A subcontractor shall provide the records described in subsection (1) of this section
to an authorized third party representative only to the extent that the information contained
in the records pertains specifically to the employee on whose behalf the authorized third
party representative is acting and to whatever extent that the subcontractor would be law-
Enrolled Senate Bill 426 (SB 426-B) Page 3
fully required to disclose such records to the employee if the employee was acting on the
employee’s own behalf under ORS 652.750.
(3) A subcontractor’s failure to comply with subsection (1) of this section does not relieve
an owner or a direct contractor of the liability prescribed by section 2 of this 2025 Act.
(4) Nothing in this section shall alter an owner’s or a direct contractor’s obligation to
timely pay a subcontractor under ORS chapter 701, except that an owner and a direct con-
tractor may withhold payment to a subcontractor:
(a)(A) Because of the subcontractor’s failure to comply with the request for records un-
der subsection (1) of this section; and
(B) In an amount and to the extent that the owner or direct contractor has paid, on
behalf of the subcontractor, wages owed to the employees of the subcontractor; or
(b) In an amount and to the extent that the owner or direct contractor has paid, on be-
half of the subcontractor, wages owed to the employees of the subcontractor.
(5) A direct contractor or subcontractor may not disclose personally identifying infor-
mation about workers who perform work on a construction project except to the extent
necessary to comply with federal or state laws.
(6) As used in this section, “principal” means a person, including an owner or a direct
contractor, that commissions a construction project and that is responsible for the project’s
scope, standards and objectives.
SECTION 4.
Sections 2 and 3 of this 2025 Act apply to labor performed by workers on a
project for a direct contractor or subcontractor on or after the effective date of this 2025
Act.
Passed by Senate April 9, 2025
Repassed by Senate May 29, 2025
..................................................................................
Obadiah Rutledge, Secretary of Senate
..................................................................................
Rob Wagner, President of Senate
Passed by House May 28, 2025
..................................................................................
Julie Fahey, Speaker of House
Received by Governor:
........................M.,........................................................., 2025
Approved:
........................M.,........................................................., 2025
..................................................................................
Tina Kotek, Governor
Filed in Office of Secretary of State:
........................M.,........................................................., 2025
..................................................................................
Tobias Read, Secretary of State
Enrolled Senate Bill 426 (SB 426-B) Page 4