Use the Lexology Getting The Deal Through tool to compare the answers in this article with those from other jurisdictions.
Which issues would you most highlight to someone new to your state?
Ohio’s legal climate for employers is generally positive, with several exceptions discussed below. The statutory employment protections apply to any employer with four or more employees, which is well below the thresholds for corresponding federal employment laws. State minimum wage, effective as of 2019, is $8.55 per hour; under the Ohio Constitution, the minimum wage rate will adjust each year based on the rate of inflation.
What do you consider unique to those doing business in your state?
Ohio law imposes individual liability on managers and supervisors for employment discrimination. Although Ohio has a state-level corollary to the federal Equal Employment Opportunity Commission, state law does not require employees to exhaust their administrative remedies before filing suit in court.
Is there any general advice you would give in the labor/employment area?
Subject to the exceptions discussed below, Ohio law is similar to federal law with regard to employment laws and related compliance requirements.
What are the emerging trends in employment law in your state, including the interplay with other areas of law, such as firearms legislation, legalization of marijuana and privacy?
In January 2019 sales under Ohio’s medical marijuana program began. The implementing legislation explicitly disclaims any obligations on employers to accommodate users under the program, but further development in Ohio law is expected in this area.
Legislation taking effect in March 2019 protects franchisors from being deemed joint employers of franchisee employees unless the franchisor either agrees in writing to be a joint employer or exerts a degree of control over the employees that is “not customarily exercised.”
Proposals for reform
Are there any noteworthy proposals for reform in your state?
Right to work legislation has been debated for several years. As the neighboring states of Indiana, Kentucky, and Michigan have passed right to work laws, this debate has intensified – with no end in sight.
What state-specific laws govern the employment relationship?
Chapter 4112 of the Ohio Revised Code contains most of Ohio’s laws pertaining to the employment relationship.
Who do these cover, including categories of workers?
Chapter 4112 defines an “employer” as anyone with four or more employees – as well as “any person acting directly or indirectly in the interest of an employer.” The latter provision has been construed to impose individual liability on supervisors and managers. The term “employee” is defined broadly (and circularly) as anyone who is employed by an employer.
Are there state-specific rules regarding employee/contractor misclassification?
Most Ohio courts address the right of control exercised over the individual’s actions to determine whether it is an employment relationship or an independent contractor relationship. The Ohio Department of Job and Family Services and the Bureau of Workers’ Compensation each applies a 20-factor analysis, the first factor of which is control, to make this determination in the context of unemployment compensation and workers compensation coverage.
Must an employment contract be in writing?
Ohio law does not require employment contracts to be in writing.
Are any terms implied into employment contracts?
Ohio law recognizes an implied duty of good faith and fair dealing in every contract. Most courts hold that this duty is part of a breach of contract claim, rather than an independent tort claim.
Are mandatory arbitration agreements enforceable?
By statute, Ohio law recognizes the enforceability of arbitration agreements “except upon grounds that exist at law or in equity for the revocation of any contract.” Employees must demonstrate that an arbitration agreement is both procedurally and substantively unconscionable to avoid enforcement. Substantive unconscionability refers to the reasonableness of the terms in the agreement, while procedural unconscionability turns on whether one party lacked a meaningful choice in entering the agreement. However, Ohio courts have been clear that employers may condition employment on agreement to arbitration.
How can employers make changes to existing employment agreements?
Traditional contract law applies to amendments to employment agreements, and the language of the existing contract would control.
What are the requirements relating to advertising open positions?
By statute, Ohio prohibits employers from suggesting any preference or restriction on the basis of:
- military status;
- national origin;
- age; or
The same statute prohibits employers from using any employment agency or placement service (including training schools) that is “known to discriminate against persons” based on those categories. However, with respect to military status, a separate statute allows employers to adopt policies giving veterans preference for employment decisions—including hiring—without violating state employment law.
Background checks What can employers do with regard to background checks and inquiries?
(a)Criminal records and arrests
For private employers, Ohio law imposes no additional requirements or restrictions regarding the consideration of criminal history in hiring. In the context of public-sector employment, any hiring decisions based on criminal convictions must be based on the particular details of the person’s criminal record as it relates to the duties of the job at issue. Should the public-sector employer decide not to hire an applicant on that basis, it must advise the person in writing about the reasons they are being rejected.
Ohio’s protections against disability discrimination mirror those under the federal Americans with Disabilities Act.
Ohio law generally provides employers with flexibility in choosing when and how to conduct drug testing, both pre and post-employment. Ohio’s courts have rejected various claims that drug testing programs violate reasonable expectations of privacy. Also, the Ohio Bureau of Workers’ Compensation has instituted a drug-free safety program, which provides premium rebates to employers that adopt and maintain policies to prevent the use and misuse of alcohol and other drugs—especially illegal drugs—in the workplace.
Ohio law does not impose any conditions with regard to the use of credit checks in employment; therefore, employers should look to the federal Fair Credit Reporting Act for compliance requirements in this area. With respect to wage garnishments, Ohio’s statute provides that employers may not discharge any employee because their wages were subject to garnishment “by only one judgment creditor in any twelve-month period.” Although this provision clearly implies that a termination decision can be based on garnishments by two or more creditors, Ohio law has not definitively resolved this question.
Ohio law does not impose additional requirements with regard to immigration status in employment, apart from the existing requirements of federal law.
Unlike some other states, Ohio has not passed legislation specific to employees’ social media accounts (eg, laws prohibiting employers from requiring that employees provide their passwords to Facebook and other accounts). Ohio common law on privacy governs this area, along with federal law under the National Labor Relations Act. Review of candidates’ social media history and postings can raise questions about whether the employer uncovered information that it would not be at liberty to ask from the candidates, such as religious background or marital status.
For public school districts, certain convictions may disqualify individuals from employment. Otherwise, Ohio law imposes no unusual requirements with respect to background checks for private employers.
Wage and hour
What are the main sources of wage and hour laws in your state?
Ohio’s wage and hour laws are codified by state statute, but they generally impose no greater requirements than the federal Fair Labor Standards Act. Exceptions are the hourly minimum wage and the enforcement provisions of Article II, Section 34a of the Ohio Constitution, which provide for recovery of treble damages for minimum wage violations (by contrast to the double damages provided under federal law).
What is the minimum hourly wage?
The minimum hourly wage is $8.55 per hour, as of January 1, 2019. Under the Ohio Constitution, this rate will adjust each year based on the rate of inflation.
What are the rules applicable to final pay and deductions from wages?
Ohio law requires the payment of final wages within 15 days or (on demand of the terminating employee) at the time of the next regularly scheduled payday, whichever comes first. Any deductions from the individual’s wages must be pursuant to written authorization by the employee, which can be revoked at any time.
Hours and overtime
What are the requirements for meal and rest breaks?
As with the federal Fair Labor Standards Act, Ohio law does not require that employers provide meal periods. However, for any meal period during which the employee is off the clock, the employee should be relieved of all work-related duties for at least 30 minutes. Rest breaks are also handled in accordance with federal law in Ohio, meaning that a rest break of between 15 and 20 minutes is customary and should be treated as compensable time.
What are the maximum hour rules?
Ohio imposes no rules regarding the maximum hours that employees may work, subject to the general requirements relating to payment of overtime premium pay.
How should overtime be calculated?
Overtime premium pay is calculated in accordance with the federal Fair Labor Standards Act. Ohio does not require overtime on a daily basis; it is calculated based on any hours worked over 40 hours in a particular work week.
What exemptions are there from overtime?
Exemptions from overtime under Ohio law are determined in accordance with the federal Fair Labor Standards Act.
What payroll and payment records must be maintained?
Under the Ohio Constitution’s minimum wage provisions (Article II, Section 34a), employers are required to maintain records of the employee’s name, address, occupation, and pay rate, the hours worked for each day worked, and each amount paid to the employee. These records must be preserved for at least three years following the individual’s last day of employment. The Ohio Constitution also stipulates that the employer must provide these records at no charge to the employee or to any “person acting on behalf of an employee”—which includes a lawyer or union representative. Violations of this record keeping requirement are actionable and may be investigated by the state as well. Further, retaliation protections are provided for any employee who exercises these rights with respect to employee records.
Discrimination, harassment and family leave
What is the state law in relation to: Protected categories
Employees aged 40 and older are protected from discrimination by Ohio law.
Ohio law explicitly recognizes race as a protected characteristic for the purposes of employment discrimination law.
Ohio law explicitly recognizes disability as a protected characteristic for the purposes of employment discrimination law. “Disability” is defined under Ohio law as it is under the federal Americans with Disabilities Act.
Ohio law explicitly recognizes sex as a protected characteristic for the purposes of employment discrimination law.
Ohio law includes no specific protections for sexual orientation under state laws against discrimination. However, the US Court of Appeals for the Sixth Circuit—decisions of which control matters of federal law for employers in Ohio—has held that federal employment laws cover both sexual orientation discrimination and discrimination on the basis of transgender status.
Ohio law explicitly recognizes religion as a protected characteristic for the purposes of employment discrimination law. However, unlike federal law, Ohio law does not explicitly include exemptions allowing certain religious employers to base hiring decisions on the religious beliefs of the individual at issue, thus raising questions under what is generally known as the “ministerial exemption.”
Discrimination on the basis of medical status is generally covered under Ohio law’s prohibition of disability-based discrimination.
Although Ohio law has not resolved the issue, employers in Ohio are subject to the US Court of Appeals for the Sixth Circuit’s ruling that employment decisions based on transgender status are actionable under federal prohibitions against sex-based discrimination.
What is the state law in relation to harassment?
Ohio law regarding harassment is construed in accordance with federal law.
Family and medical leave
What is the state law in relation to family and medical leave?
Ohio has not enacted a state-law corollary to the federal Family and Medical Leave Act. However, the Ohio Military Family Leave Act provides that an eligible employee can take up to 10 work days or 80 hours of work (whichever is less) off if a spouse, parent, or child is called to active military service for more than 30 days, or if that person is injured in the line of duty. The eligibility requirements of this law are similar to those under the federal Family and Medical Leave Act, but certain distinctions apply.
Privacy in the workplace
Privacy and monitoring
What are employees’ rights with regard to privacy and monitoring?
For employees in the private sector, Ohio common law governs monitoring and related issues. In general, a private-sector employer can insulate itself from liability on these issues if it makes clear that employees have no expectation of privacy in company-provided email systems or electronic devices.
Are there state rules protecting social media passwords in the employment context and/or on employer monitoring of employee social media accounts?
Ohio law has not explicitly addressed social media passwords or monitoring of social media accounts. As noted above, Ohio’s common law pertaining to invasion of privacy governs these issues; however, employees generally do not have a reasonable expectation of privacy in company-owned resources if the employer has made clear that monitoring may occur.
Bring your own device
What is the latest position in relation to bring your own device?
Ohio law provides no particular rights or limitations with respect to employer policies requiring or allowing employees to bring their own devices for work-related use.
To what extent can employers regulate off-duty conduct?
Ohio does not have a statute limiting employers from making decisions based on off-duty conduct. Any claims based on an employer’s consideration of off-duty conduct will be based on Ohio’s common law regarding invasion of privacy.
Are there state rules protecting gun rights in the employment context?
Ohio law allows employers to prohibit weapons in the workplace, even with regard to employees who hold valid concealed-carry licenses from the state. However, an employer may not prohibit an employee who has a concealed-carry license from keeping their weapon in their personal vehicle, even if that vehicle is parked on company-owned premises.
Trade secrets and restrictive covenants
Who owns IP rights created by employees during the course of their employment?
Ohio law allows employers to agree by contract that inventions or other developments created by employees during the course of their employment are the property of the employer.
What types of restrictive covenants are recognized and enforceable?
Based on cases dating back many decades, the Ohio courts will enforce non-competition agreements if the restrictions are reasonable and necessary to protect the legitimate business interests of the employer. If a restriction is more broad than necessary to protect those interest, or is unreasonably overbroad, Ohio judges are permitted to reform the restrictions to bring them within the bounds of reasonableness. For example, if a judge concludes that a two-year, 100-mile restriction on competition is overbroad, the court may enforce the agreement for one year within a radius of 25 miles—effectively rewriting the parties’ agreement. Additionally, the Ohio Supreme Court has held that continued employment of an at-will employee constitutes sufficient consideration to bind that employee to a non-competition restriction, and no additional consideration is necessary.
Are there any special rules on non-competes for particular classes of employee?
Several Ohio courts have imposed heightened requirements regarding the reasonableness of non-competition agreements in the medical profession; however, other Ohio courts have declined to recognize any distinction in how the law is applied. Similarly, some Ohio courts have suggested that non-competes in the sale-of-business context should be subject to lesser scrutiny, but that is not a position that Ohio law has consistently taken.
Right to work
Is the state a “right to work” state?
Ohio is not a right to work state. Legislation in this regard has been proposed and debated in the Ohio General Assembly for years, and even more so as several neighboring states have passed and upheld right to work laws. However, no such law appears to be forthcoming in Ohio.
Unions and layoffs
Is the state (or a particular area) known to be heavily unionized?
The percentage of union-represented employees in Ohio is generally higher than the national average by approximately two percentage points. However, much of this derives from the large number of Ohio employees in the public sector.
What rules apply to layoffs? Are there particular rules for plant closures/mass layoffs?
Ohio law has no requirements relating to layoffs or plant closures. The federal Worker Adjustment and Retraining Notification Act governs employers’ actions in this area of the law.
Discipline and termination
Are there state-specific laws on the procedures employers must follow with regard to discipline and grievance procedures?
Ohio law provides no specific procedures with respect to the discipline of employees in the private sector. Public sector employees are subject to various disciplinary requirements and grievance procedures.
At-will or notice
At-will status and/or notice period?
Ohio law allows at-will employment and does not require a notice period before employment can be terminated.
What restrictions apply to the above?
Ohio law allows employers to provide notice protections under contract with individual employees.
Are there state-specific rules on when final paychecks are due after termination?
Ohio law requires payment of final wages within 15 days or (on demand of the terminating employee) at the time of the next regularly scheduled payday, whichever comes first.