Oregon Unions Win Pay Raises and Remote Work Flex for State Employees

Improved Pay and Benefits for Oregon State Employees

Most state employees in Oregon are set to receive larger paychecks and enhanced benefits starting next February, as a result of tentative labor agreements between the state and its two largest unions. After months of negotiations, officials have agreed to provide 6.5% cost-of-living raises over the next two years to members of the Oregon chapters of SEIU and AFSCME. These unions represent the majority of the state’s 45,000 full-time workers.

In addition to the salary increases, the state has also committed to creating a new salary classification for long-serving employees who have already reached the maximum pay level in their current positions. Workers with at least 10 years of service will automatically be placed into this new classification, which includes additional pay increases.

Members of both unions will soon vote on whether to ratify the agreements. If approved, the contracts will take effect at the end of August. While union leaders initially sought higher cost-of-living increases—up to 10%—they acknowledged that the proposed 6.5% raise would help keep salaries aligned with inflation and rising living costs.

“This contract will help to close that gap, but it’s still imperative Oregon continues to invest in our state workforce to ensure service needs around the state can be met and to ensure that state workers are able to provide for themselves and their families,” said Milana Grant, spokesperson for AFSCME, in an email.

Bryanna Duke, spokesperson for the Department of Administrative Services, which oversees labor negotiations, did not respond to multiple requests for comment or emailed questions about the bargaining process.

Key Provisions of the New Agreements

Under the agreement, union members will receive a 2.5% pay increase next February and a 4% increase in early 2027. The unions also negotiated slightly higher pay differentials for employees working in inclement weather or hazardous conditions. Additionally, the agreements aim to allow more state workers to work remotely full-time and make it harder for agencies to require in-person work.

One of the most significant provisions is the state’s proposal to transition from monthly to biweekly paychecks starting in July 2027. However, the state has a history of issues with payroll system changes. Earlier this year, the state agreed to pay $15 million to thousands of former and current employees who faced problems with their paychecks after switching to a new payroll system in 2022.

In a settlement agreement, the state admitted that it is still addressing errors in its payroll system. The switch to biweekly payments is expected to resolve some of these issues, according to a July letter of agreement. “The state believes updating these practices through structural changes will eliminate the current issues with Workday Payroll and improve the transparency, predictability, and accuracy of employee pay,” the letter stated.

Concerns and Safeguards

Union leaders are concerned that the transition could lead to delays or errors in employees’ paychecks. To address these concerns, both unions successfully negotiated several provisions to minimize any unintended consequences. These include a one-time $1,700 payment to all workers switching to biweekly paychecks in July 2027 and increased training for employees and managers on payroll practices.

“We spent a lot of time making sure that, as the state tries to make this change, that workers are centered in that change,” said Melissa Unger, executive director of SEIU Oregon. “Last time, that did not happen.”

These changes reflect ongoing efforts to improve communication and support for state employees during major shifts in payroll systems. As the agreements move forward, they mark a significant step toward better compensation and working conditions for Oregon’s public sector workforce.