Program pays lost wages when companies close

SALEM — Even amid companies closing in the struggling economy, an Oregon program that pays workers wages lost from shuttered employers is not seeing an increase in demand. Officials think it's because not many people know about the program.

The Statesman Journal reports that Oregon is one of a few states that have dedicated funds to cover unpaid wages when a company fails or doesn't have the money for payroll.

State Labor Commissioner Brad Avakian says the state was expecting a spike in claims, but those never materialized.

"It might be because Oregon workers don't know the fund exists," Avakian said.

The state provides a maximum of up to $4,000 in wages. It does not include sick leave or vacation. Last year the average payout was $1,048 per worker. In the nearly 25 years the fund has existed, more than $16 million have been paid to more than 16,000 workers.

The money is funded by a tax on employers. The balance in the Wage Security Fund at the moment is more than $2.3 million.

The Oregon Bureau of Labor and Industries attempts to recover a reimbursement from the failed company or its successor, and the bureau — also known as BOLI — often succeeds in recovering tens of thousand of dollars. That money is returned to the Wage Security Fund, but sometimes there is nothing left to recover.

"The BOLI thing definitely came through," said Michael Wakefield, who lost his job when the wood products company he worked for shut down. He recovered about $600.

Working from the restaurant industry have the most claims, at more than 740 claims in the past five years.

Because the money in the fund is not restricted, lawmakers this year took about $3 million from it to plug in a state budget shortfall. But Avakian says there's enough money in the funds to handle claims.

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