Oregon’s Groundbreaking Unemployment Law for Striking Workers: What’s Happening and Why It Matters

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Quick Hits

• Oregon’s Senate Bill (SB) 916 extends unemployment insurance benefits to both public and private sector workers participating in strikes.
• The U.S. Department of Labor has raised concerns about the SB 916, warning that striking workers must still demonstrate they are actively seeking work to receive benefits.
• Employers may want to review collective bargaining agreements and prepare for longer and more frequent work stoppages, as the law shifts the balance of power in labor disputes while raising questions about its long-term impact on Oregon’s business climate.

What the Law Does

SB 916 allows striking workers to be eligible for up to ten weeks of unemployment benefits during a strike. Striking employees must wait two weeks before receiving UI benefits—i.e., they must wait one week before becoming eligible for benefits (referred to as an “unpaid strike week” on the Oregon Employment Department website, in addition to the existing one-week waiting period required for all claimants before UI benefits can be paid.

The law requires UI benefits to be paid back if the employee later receives backpay that results in an overpayment of benefits. School districts will also be required to deduct from the employee’s future wages the benefits charged for weeks during a strike.

UI benefits do not fully replace a worker’s wages, and range from roughly $200 to $870 per week as of March 2026, depending on prior earnings.

Oregon is the first state to offer unemployment benefits to both public and private-sector employees who go on strike. There are three states—New Jersey, New York, and Washington—that grant some unemployment benefits to striking workers, but in those states, public employees are barred from striking. SB 916 does not modify existing Oregon law prohibiting certain types of public employees, like police officers and firefighters, from participating in a strike while allowing other public employees to strike in certain circumstances. The new law’s focus, instead, is on whether an employee is out of work “due to a labor dispute,” and it makes UI benefits available in that circumstance.

Federal Pushback in 2026

The law went into effect on January 1, 2026, and it didn’t take long for the federal government to weigh in with compliance concerns.

On January 8, 2026, the U.S. Department of Labor (DOL) issued guidance for state administrators and UI directors. The DOL’s guidance noted that federal law requires UI claimants to be “able to work, available to work, and actively seeking work” in Section 303(a)(12) of the Social Security Act. The DOL specified that a worker on strike must engage in activities that demonstrate to the state UI agency that they meet this requirement and that their efforts to secure other work are “genuine in nature.” The DOL cautioned that states cannot exempt workers on strike from this requirement and that doing so could result in the loss of federal grants. Further, if an employer asks an employee to return to work before a labor dispute is resolved and the employee refuses, the DOL advised this could be considered a refusal of work that would need to be adjudicated by the state.

The Oregon Employment Department (OED) currently advises striking workers that they must be engaged in work-seeking activities, like attending job placement meetings sponsored by the OED or updating a resume. As of March 2026, the OED website notes that “requirements for actively seeking work may change” and references “ongoing discussions” with the DOL.

First Major Test: Portland Community College Strike (March 2026)

Oregon’s SB 916 is now facing its first significant real-world test at Portland Community College (PCC), where two unions representing approximately 2,300 employees, including faculty, academic professionals, and classified staff, went on strike on March 11, 2026. The strikes mark the first in PCC’s history and are being watched closely as a test case for how SB 916 will work in practice.

The Bigger Picture

SB 916 shifts the balance of power between employers, unions, and workers in collective bargaining and labor disputes, though the extent of that shift remains to be seen. Employees are not insulated from the economic reality of a mandatory two-week waiting period before UI benefits begin, and when benefits do arrive, they replace only a fraction of the employee’s regular pay. Data from the U.S. Bureau of Labor Statistics suggests that the majority of strikes are shorter than the waiting period for UI benefits, meaning that most striking workers might exhaust the waiting period before collecting UI benefits.

For employers, the more pressing concern may be less about individual strikes and more about the aggregate effect: SB 916 is expected to produce longer and more frequent work stoppages over time, and work stoppages impose a direct cost on Oregon’s unemployment insurance fund (a fund sustained by employer payroll taxes), raising legitimate questions about the law’s long-term effect on Oregon’s business climate.

Next Steps for Employers

Unionized employers may want to review their collective bargaining agreements with fresh eyes to determine if and how a no-strike clause applies.

Unionized employers may also want to prepare for the increased possibility of a strike. In addition to modeling the financial exposure of a prolonged work stoppage, there are many things to consider when preparing for a strike, including the following top-line items:

• Developing a plan to continue operations, including hiring replacement workers or cross-training employees and management.
• Communicating with customers and third-party vendors about operations.
• Determining the legality of preparations for a strike, how to communicate with employees, and preparing for other important aspects of handling a strike or potential strike.

Public employers may also want to determine whether and how UI benefits may be recovered.

Ogletree Deakins’ Portland (OR) office will continue to monitor developments and will post updates on the Higher Education, Oregon, and Traditional Labor Relations blogs as additional information becomes available.

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