Most private sector, non-union, employees are not subject to a contract but are employed at-will. To the extent an employee has an employment contract, the terms of the contract, including those related to termination, are governed by contract law.
Procedures For Terminating the Agreement
There are no required procedures for terminating an individual employment relationship.
An employer who engages in a “mass layoff” or “plant closing” must follow the procedures set forth in the federal Worker Adjustment and Retraining Notification Act (“WARN”).
Employers may terminate the at-will employment relationship at any time and for any or no reason – except an illegal one. Ohio courts, however, have created an amorphous body of public policy exceptions to the employment at-will doctrine.
Employees may resign at any time and for any or no reason.
Termination On Notice
Unless specifically set forth in an employment agreement, no minimum notice period is required to terminate an employment relationship.
Termination By Reason Of The Employee's Age
Except in very limited cases where a mandatory retirement age is required by law, an employer may not terminate an employee because of the employee’s age if the employee is over the age of 40.
Automatic Termination In Cases Of Force Majeure
Ohio law recognizes the force majeure doctrine.
Collective dismissals may trigger two federal laws: WARN and the Older Workers’ Benefits Protection Act (“OWBPA”)
Termination By Parties’ Agreement
The parties’ employment agreement may set forth limitations on an employer’s ability to terminate the employee. Otherwise, prior court or administrative agency approval is not required to effectuate a termination.
Directors Or Other Senior Officers
There are no special rules for firing directors or senior officers. A minority shareholder/employee of a close corporation only can be terminated for a legitimate purpose.
Special Rules For Categories Of Employee
The Ohio and federal employment laws apply to employees – not independent contractors. Child labor laws govern employment of employees under 18 years of age.
Specific Rules For Companies in Financial Difficulties
Other than WARN, and a notification to the Ohio unemployment agency of a layoff involving 50 or more employees with a 7- day period, there are no specific employment laws for companies in financial difficulties.
The Ohio Whistleblower Protection Act (“WPA”) protects employees (from retaliation) who report an employer or fellow employee for what they reasonably believe to be: (1) a “criminal offense that is likely to cause an imminent risk of physical harm to persons or a hazard to public health; (2) a felony; or (3) an improper solicitation for a contribution.” The Ohio WPA is complex. The reporting employee must take several procedural steps to notify the employer. After such notification, the employer must correct the violation or make a reasonable and good faith effort to correct it within 24 hours. If the employee is retaliated against, he/she can bring a civil action within a set period of time.
Special Rules For Garden Leave
No Ohio statutory requirement.
Restricting Future Activities
Contractual agreements restricting future activities must be reasonable in scope, geographic limitation, and time in order to be enforceable in court. Typical clauses include non-disclosure, non competition, and non-solicitation covenants.
There is no Ohio law requiring severance payments. However, when an employer seeks a release of claims from an employee 40 years or older, the OWBPA requires consideration (e.g., severance pay) in exchange for a specific release of an ADEA claim, 21 calendar days to consider the release (45 calendar days for group terminations and lists), and a 7-calendar day revocation period.
Special Tax Provisions And Severance Payments
Severance payments are subject to all applicable taxes and withholdings.
Allowances Payable To Employees After Termination
No statutory requirement. Whether an employee may receive any unused and applicable paid time off balances depends on the employer’s policy covering any paid time off benefit.
Time Limits For Claims Following Termination
Because Ohio has its own state anti-discrimination agency, employees must file a charge alleging discrimination with the Equal Employment Opportunity Commission (“EEOC”) within 300 days after the unlawful discriminatory practices alleged in the charge were committed. The employee’s right to sue in federal court is contingent upon filing a charge of discrimination with the EEOC. A suit in federal court alleging violation of Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act and / or the Age Discrimination in Employment Act must be filed within 90 days of receipt of the EEOC’s Dismissal and Notice of Rights. Suits alleging violation of the federal Equal Pay Act (“EPA”) must be filed in federal or Ohio court within 2 years (3 years for wilful violations) of the alleged EPA underpayment.
Employees must file a charge alleging discrimination with the Ohio Civil Rights Commission (“OCRC”) within 6 months after the unlawful discriminatory practices alleged in the charge were committed. Employees must file a lawsuit alleging violation of the Ohio Civil Rights law within 6 years after the unlawful discriminatory practices alleged in the suit were committed. The employee’s right to sue alleging violation of state law is not contingent upon filing a charge of discrimination with the Ohio Civil Rights Commission.