The nine Oregon counties that want to opt out of the state's new paid sick leave law won a major victory on Thursday, when a circuit court judge in Linn County ruled the law is an unfunded mandate.

Under a 1996 amendment to the Oregon Constitution, the state cannot force local governments to adopt new programs unless it provides funding.

"The immediate consequence is that nine counties in Oregon will not have to participate in a randomly created paid sick leave program by the state," said Roger Nyquist, chairman of the Linn County Board of Commissioners and a leader in the effort, on Friday. "There was no case law to this constitutional provision until yesterday."

The Oregon Department of Justice is still deciding whether to appeal the ruling by Linn County Circuit Judge Daniel Murphy. "We are disappointed in yesterday's ruling, and we are considering our options for an appeal," spokeswoman Kristina Edmunson wrote in an email on Friday.

Gov. Kate Brown is named as a defendant in the lawsuit, but the decision of whether to appeal is up to the Oregon Department of Justice, said Brown's spokesman Chris Pair.

"Governor Brown carefully reviewed the paid sick leave bill before signing it and disagrees with the court's decision," Pair wrote in an email.

Lawyers for the Legislature warned lawmakers in 2015 that the sick leave law could trigger the constitutional provision on unfunded mandates. The state's defense was also undercut by a previous attorney general's opinion that the unfunded mandate provision would apply to public employee pensions, also an employee benefit, according to the judge's ruling.

The 2015 sick leave law requires employers with at least 10 employees to provide 40 hours of paid sick time every year. Employers with fewer employees must offer the same amount of unpaid sick leave.

Linn, Douglas, Jefferson, Malheur, Morrow, Polk, Sherman, Wallowa and Yamhill counties filed the lawsuit at the end of May. The ruling issued on Thursday only applies to those nine counties that sued to opt out of the sick leave law, said Nathan Rietmann, the lawyer representing the counties. As soon as judgements are entered in the case, the counties can stop complying "more or less immediately," Rietmann said.

Nyquist said nearly all of Linn County's employees already received paid sick time before the new law, so the main impact was to force the county to provide paid leave for temporary employees at the fairgrounds and expo center and parks department. It cost approximately $41,000 so far for Linn County to comply with the sick leave law, according to the judge's ruling.

However, the impact of the ruling could ripple beyond the county governments. Nyquist has said the same constitutional provision on unfunded mandates also exempts private employers that compete with governments in affected counties.

Local governments could also use the new case law to file lawsuits seeking to opt out of this year's law increasing the minimum wage.

"You don't have to read very far into this decision with minimum wage in the back of your mind to think it might apply, but I'm not an attorney and we'll let smart legal minds address that issue," Nyquist said.

-- Hillary Borrud

503-294-4034; @hborrud