Guide to Firing Employees in Ohio for Employers

April 11th 2024

Firing an employee is one of the most challenging tasks for any employer, carrying legal, financial, and interpersonal implications. In Ohio, as in many other states, there are specific laws and regulations governing the termination process that both employers and employees need to understand carefully. From reasons for termination to documentation requirements, navigating these guidelines is crucial to ensure a fair and lawful dismissal. Read on as we cover the essential aspects of firing employees in Ohio for employers.

This Guide Covers

What Does Firing an Employee Involve?
Differentiating between Firing, Layoffs, and Resignations in Ohio
Why the Termination Process Matters in Ohio
Termination Laws in Ohio: What You Need to Know
Legal Implications of Wrongful Termination in Ohio
Required Documents for Employers and Terminated Employees in Ohio
Who is Responsible for Terminating in Ohio?
How Long Should the Termination Process Last in Ohio?
How Can You Prepare for Termination in Ohio?
Steps for a Respectful Termination Process in Ohio
Post-Termination: What Happens Next?
Legal Considerations During Termination in Ohio
Bonus: Best Practices for Reducing Litigation Risks in Ohio

What Does Firing an Employee Involve?

Firing or terminating an employee is the process of permanently ending an employee’s contract of employment with a company. This decision can be driven by various factors including, but not limited to, performance issues, misconduct, redundancy, or business closure.

Differentiating between Firing, Layoffs, and Resignations in Ohio

In the context of employment terminations, it’s crucial for employers, especially those in Ohio, to carefully understand the differences between firing, layoffs, and resignations. Each scenario has distinct implications for both the employee and employer in Ohio, and handling them appropriately is essential to maintain a fair workplace and comply with legal standards.

Firing in Ohio

Firing, also known as termination or dismissal, occurs when an employer ends an employment relationship with an employee. In Ohio state, employment is generally considered “at-will,” meaning employers can terminate employees for any reason that is not illegal, such as discrimination based on race, gender, or religion. However, there are exceptions and protections under state and federal laws. Ohio employers must be mindful of adhering to these regulations to avoid potential legal repercussions. It’s essential to document the reasons for termination thoroughly and ensure that they comply with both company policies and legal requirements.

Layoffs in Ohio

Layoffs refer to the temporary or permanent separation of employees from their jobs due to reasons such as economic downturns, restructuring, or technological changes that make certain positions obsolete. In Ohio, employers must follow specific rules regarding layoffs, especially concerning notification requirements under the WARN Act. These laws mandate that employers provide advance notice of mass layoffs or plant closures, typically to both affected employees and state agencies. Moreover, laid-off employees may be entitled to certain benefits, such as unemployment compensation, depending on individual circumstances and eligibility criteria.

Resignations in Ohio

Resignation occurs when an employee voluntarily decides to terminate employment. In Ohio, employees are free to resign at any time, although certain employment contracts or collective bargaining agreements may stipulate notice periods or other conditions. Employers should handle resignations professionally, conducting exit interviews to gain insights into employee satisfaction and potential areas for improvement. Additionally, employers must ensure that departing employees receive their final paychecks promptly and address any outstanding benefits or accrued leave balances in accordance with state law and company policies.

Why Does the Termination Process Matter in Ohio?

A correctly conducted termination process in Ohio is particularly important due to the state’s stringent labor laws and the heightened focus on employee rights. Here’s why the termination process matters in Ohio:

  • Compliance with State Labor Laws: Ohio has specific labor laws governing the termination process, which employers must adhere to strictly. These laws outline the rights of both employers and employees and set forth procedures for fair and lawful termination. For employers, understanding and complying with these laws is essential to avoid legal consequences, such as lawsuits or fines, which can result from wrongful termination claims. By following the prescribed termination process, employers can ensure that they remain in compliance with Ohio’s labor regulations and protect themselves from potential liabilities.
  • Protection of Employee Rights: Ohio places a significant emphasis on protecting the rights of employees, particularly concerning termination. Employees in Ohio have various legal protections against wrongful termination, discrimination, retaliation, and other unlawful practices. The termination process plays a critical role in upholding these rights by ensuring that employees are treated fairly and equitably when their employment is terminated. By following proper termination procedures as mandated by Ohio state, employers can demonstrate respect for employee rights and minimize the risk of any legal disputes or reputational damage.
  • Preservation of Company Reputation: The termination process can significantly impact an employer’s reputation within the community and industry. How an employer handles terminations can influence perceptions of the company’s values, ethics, and commitment to employee well-being. In Ohio, where businesses operate in close-knit communities, reputation matters greatly. A poorly executed termination can lead to negative publicity, damage to brand image, and difficulty attracting top talent in the future. Therefore, conducting terminations in a professional, respectful manner is essential for preserving the company’s reputation and maintaining positive relationships with employees, customers, and stakeholders.
  • Mitigation of Legal Risks: Failing to follow proper termination procedures can expose employers to various legal risks and liabilities. In Ohio, wrongful termination lawsuits are not uncommon, and courts may impose significant penalties on employers found guilty of violating employment laws. By adhering to established processes, employers can mitigate these legal risks and safeguard themselves against lawsuits, settlements, or regulatory enforcement actions. Additionally, documenting the reasons for termination and maintaining clear communication with employees throughout can provide valuable evidence in the event of a legal dispute.

Termination Laws in Ohio: What You Need to Know

Here are the termination laws that the Ohio workforce (on-site and remote) should be familiar with:

Laws Regarding Termination of On-Site Employees in Ohio

  • Ohio Fair Employment Practices Act (OFEPA): OFEPA prohibits discrimination in employment based on race, color, religion, sex, national origin, disability, age, or ancestry. It’s important for employers in Ohio to ensure that termination decisions do not stem from discriminatory reasons. When terminating an on-site employee, complete documentation showing the non-discriminatory basis for the termination decision, such as performance issues or economic necessity, should be maintained to defend against potential discrimination claims.
  • Ohio Minimum Fair Wage Standards Act: The Ohio Minimum Fair Wage Standards Act includes provisions regarding the payment of wages, including final paychecks. In Ohio, an employer must pay a terminated employee their final paycheck by the next regular payday, either through the usual payment method or by mail if requested by the employee. Employers should ensure compliance with this timing to avoid violations and potential penalties.
  • Ohio Workers’ Adjustment and Retraining Notification (WARN) Act: While Ohio follows the federal WARN Act rather than having a state-specific version, employers planning a mass layoff or plant closing must provide affected employees with 60 days’ notice. This federal requirement is designed to give workers time to prepare for the transition. Employers must understand the conditions under which WARN notices are required and comply accordingly.

Laws Regarding Termination of Remote Employees in Ohio

  • Uniform Electronic Transactions Act (UETA) in Ohio: Ohio has adopted UETA, which ensures that electronic signatures and records are as legally valid as their paper equivalents. For remote employees, this means that termination notices and other relevant documents provided electronically are legally binding. Employers in Ohio should ensure that electronic termination procedures comply with all relevant laws, including providing clear reasons for termination.
  • Telecommuting Employees Under Ohio Law: Ohio does not have specific statutes that exclusively govern the termination of remote or telecommuting employees, meaning that general employment laws apply regardless of the employee’s work location. This includes adherence to Ohio Fair Employment Practices Act (OFEPA), ensuring non-discrimination in the termination process, and following Ohio’s guidelines for the final paycheck. Employers must treat remote employees with the same fairness and legal compliance as on-site employees.
  • Final Paycheck Laws: As with on-site employees, remote employees in Ohio must receive their final paycheck by the next regular payday. This includes any unpaid wages, overtime payment, and accrued vacation pay if the employer’s policy provides for a payout upon termination. Employers should carefully process final paychecks to avoid legal disputes.

In Ohio, the legal implications of wrongful termination can be extensive and complex, given the state’s robust employment laws and protections. Here’s a detailed look at these implications:

  • Civil Lawsuits for Damages: When an employee is wrongfully terminated in Ohio, one of the most direct implications is the potential for civil lawsuits. Wrongfully terminated employees can sue their former employers for damages. These damages can include lost wages, benefits, and sometimes punitive damages if the employer’s actions were particularly egregious. The lawsuit may also seek reinstatement if the employee desires to return to their job. Employers found liable may face substantial financial liabilities, including compensatory damages and legal costs.
  • Administrative Claims: Before or instead of a lawsuit, wrongfully terminated employees might file a claim with state or federal agencies. For instance, discrimination claims can be filed with the Ohio Civil Rights Commission (OCRC) or the Equal Employment Opportunity Commission (EEOC). These state-wide agencies investigate the legal claims and can offer mediation or other remedies. If these agencies find evidence of wrongful termination, they can issue a “right to sue” letter, allowing the employee to pursue litigation. This process underscores the importance of adherence to fair employment practices to avoid legal complications.
  • Reputational Damage: The implications of wrongful termination extend beyond legal and financial consequences. For employers in Ohio, being found guilty of wrongful termination can lead to significant reputational damage. In the age of social media and online reviews, news of wrongful termination cases can spread quickly, potentially harming an employer’s brand and making it more challenging to attract and retain top talent in the company. This reputational damage can have long-lasting effects on a business’s success and should not be underestimated.
  • Impact on Workplace Morale and Productivity: Wrongful termination can also have an impact on the morale and productivity of existing employees. When employees see a colleague terminated under questionable circumstances, it can lead to fear, mistrust, and a decrease in employee engagement. This can hinder productivity and increase staff turnover, as employees may feel insecure about their job stability and seek employment elsewhere. Employers must consider the broader implications of their termination decisions on the workforce’s overall health.
  • Legal and Financial Penalties: Employers found guilty of wrongful termination may face not only compensatory damages but also legal and financial penalties. These penalties can include fines imposed by regulatory agencies, back pay, benefits to the wrongfully terminated employee, and, in some cases, punitive damages. The legal costs associated with defending against wrongful termination claims can also be significant, including attorney fees and court costs, which highlight the need for employers to exercise fairness in their termination practices.

Required Documents for Employers and Terminated Employees in Ohio

Here’s a detailed breakdown of the essential documents required in the termination process:

Employers’ Requirements 

  • Termination Letter: A termination letter is a fundamental document that employers must provide to a terminated employee. This letter should clearly state the reason for termination, the effective date of termination, and any severance package, if applicable. It should also include information about the continuation of benefits, such as COBRA health insurance, and instructions for returning company property. Providing a detailed termination letter helps ensure clarity and can serve as important documentation in case of any disputes or claims.
  • Final Paycheck Documentation: Ohio law requires employers to provide the final paycheck to terminated employees by the next regular pay period or as soon as possible. It is important for employers to prepare complete documentation that itemizes the final paycheck, including regular wages, overtime, unused vacation pay (if applicable), and any deductions. This documentation is crucial for transparency and can help prevent disputes over unpaid wages.
  • COBRA Notification: For employers who offer group health insurance, it’s necessary to provide a COBRA notification to terminated employees. This notification must outline the employee’s right to continue their health insurance coverage under the company’s plan for a limited period. The document should clearly explain how to elect COBRA coverage, the cost, and the deadlines involved. Timely and accurate COBRA notifications are required by federal law and are essential for ensuring that employees know the rights to health insurance continuation.

Terminated Employees’ Requirements 

  • Acknowledgment of Receipt: Terminated employees should provide an acknowledgment of receipt for the termination letter and any other documents received during the termination process. This acknowledgment does not mean agreement with the reason for termination but serves as proof that the employee received the documents. This can be critically important in any subsequent legal actions or disputes, ensuring there is a clear record of communication.
  • Property Return Receipt: If the employee is required to return company property, such as laptops, mobile phones, or keys, it’s advisable to provide a property return receipt. This receipt should list all items returned to the employer, the condition of each item, and the date of return. This document protects the employee by confirming that they fulfilled their obligation to return company property, potentially preventing future claims of property retention or damage.
  • Unemployment Benefits Application: While not a document provided by the employer, terminated employees in Ohio should prepare to file an application for unemployment benefits. This application requires information about the employee’s work history, the reason for termination, and earnings. Gathering documents such as pay stubs, the termination letter, and any other records can help streamline the process and support employee’s claim for benefits.

Who is Responsible for Terminating in Ohio?

In Ohio, the responsibility for terminating an employee is shared among Human Resources (HR), managers, and legal counsel. Each party has a crucial role to play to ensure the process is conducted fairly, respectfully, sensitively, and in compliance with Ohio state laws. 

Role and Responsibilities of Human Resources 

Human Resources (HR) is central to the termination process, ensuring adherence to both company policies and Ohio’s legal framework. HR’s responsibilities include conducting a thorough review of the employee’s performance, behavior, and any disciplinary actions, ensuring that a documented basis for termination exists. They also manage the logistics, such as preparing the necessary paperwork, orchestrating the final pay, and explaining post-termination benefits. HR plays a crucial role in training managers on how to handle terminations and is often present during the meeting to facilitate the process and answer any procedural questions.

Role and Responsibilities of Managers 

Managers in Ohio have the direct responsibility of managing the performance and conduct of their team members, making them key players in the termination process. They are tasked with documenting performance issues and any corrective actions taken, providing a clear and fair basis for any termination decision. Managers often have the difficult task of communicating the termination decision to the employee, and need to do so with dignity and respect. Additionally, they must balance the needs of the organization with empathy towards the affected employee, ensuring the termination is handled as smoothly as possible while minimizing the impact on team morale.

Role and Responsibilities of Legal Counsel

Legal counsel in Ohio provides the essential service of ensuring that the termination process complies with all applicable laws and minimizes legal risks to the organization. They review the documentation leading to the termination decision, advising on legal exposure and the adequacy of the evidence supporting the termination. Legal counsel also assists in drafting or reviewing termination letters and severance agreements to ensure they are legally sound. Additionally, their expertise is crucial in navigating complex legal issues, such as allegations of discrimination or wrongful termination of an employee, providing a strong defense for the company’s actions.

How Long Should the Termination Process Last in Ohio?

The termination process in Ohio doesn’t have a specific mandated duration because the state follows the “at-will” employment doctrine, allowing employers to terminate employees at any time for any reason that is not illegal (as mandated by the state) without a notice period. 

However, the process should be handled carefully to avoid wrongful termination claims. This involves proper documentation of performance issues, preparation of the final paycheck at the time of termination, and conducting a termination meeting in a respectful, professional manner. 

Employers should also provide a termination letter detailing the reasons for dismissal and any final compensation owed to the employee. It’s important for employers to comply with all relevant federal and state laws to ensure the termination process is conducted legally and fairly.

How Can You Prepare for Termination in Ohio?

Preparing for termination in Ohio involves a series of steps, which include:

  • Review the employee’s performance documentation for consistency and fairness.
  • Ensure all performance issues have been communicated to the employee.
  • Prepare the employee’s final paycheck to be provided at the time of termination.
  • Schedule the meeting in a private setting and consider having a third party present.
  • Draft a letter outlining the reasons for dismissal and final compensation details.
  • Follow legal guidelines to avoid discrimination, retaliation, or breach of contract claims.
  • Consult with legal counsel to ensure compliance with all applicable laws and regulations.

Steps for a Respectful Termination Process in Ohio

Here are the steps to ensure a respectful termination process in Ohio:

  • Step 1: Review Company Policy and Employment Agreement: Before taking any action, it’s essential to review the company’s termination policies and the employment agreement. Ensure that any steps you plan to take are in compliance with both. This includes checking for any procedures that must be followed, notice periods that must be given, and any severance that may be outlined in the contract. This initial step helps protect against potential legal issues.
  • Step 2: Document Performance Issues: Documentation is key in the termination process. If the termination is due to performance issues or misconduct, make sure you have documented all relevant incidents, performance reviews, and any steps taken to address these issues, such as warnings or opportunities provided for improvement. This documentation can be crucial for justifying the termination and defending against any potential claims of wrongful termination.
  • Step 3: Prepare for the Meeting: Termination should always be conducted in person if possible. Schedule a meeting in a private setting where the conversation cannot be overheard. It’s also advisable to have a witness present, typically someone from HR, to ensure there is an accurate account of the meeting. Also, prepare what you’re going to say ahead of time.
  • Step 4: Conduct the Termination Meeting: Communicate the decision in a clear, straightforward manner during the meeting. Explain the reasons for the termination, relying on the documentation you have prepared. It’s important to remain professional and empathetic, acknowledging that this is difficult news for the employee. Avoid getting drawn into a debate about the decision; while you should answer any questions they have, the decision is final.
  • Step 5: Discuss Logistics: Once the decision has been communicated, discuss the next steps, explaining any severance pay, the return of company property, and how the transition will be handled. Provide information on the continuation of benefits, if applicable, and any support services, such as outplacement counseling, that the company offers to the terminated employee.
  • Step 6: Provide Written Documentation: Following the meeting, provide the employee with a termination letter that outlines the key points discussed, including the reasons for termination, details about severance pay, benefits, and any other important information. Note that this official document serves as a formal record of the termination, so make it clear.
  • Step 7: Manage the Aftermath: After the termination, consider how to communicate the departure to the rest of the team in a way that respects the privacy of the individual who was terminated while also addressing any impacts on the team’s work. It’s also a good opportunity to address any morale issues and reassure remaining employees about their own job security.

Post-Termination: What Happens Next?

When navigating the aftermath of an employee’s termination, employers in Ohio are faced with critical steps to ensure compliance with legal requirements and to manage the transition smoothly. The end of an employment relationship, regardless of the reason, triggers specific obligations, from final paychecks to the management of benefits and company property.

One of the first responsibilities an employer must address is the final paycheck. Ohio law mandates that terminated employees receive final wages by the next regular payday. This includes any accrued vacation or paid time off, assuming the company’s policy or the employee’s contract stipulates payment for such. Failure to comply with these requirements can lead to penalties, making it imperative for employers to have a clear understanding of their obligations.

Beyond the issue of final pay, employers must also manage the continuation of health benefits. Under the Consolidated Omnibus Budget Reconciliation Act (COBRA), employers who offer group health plans and have at least 20 employees are generally required to offer employees the option to continue their health insurance coverage at their own expense for a limited period. 

Termination also involves logistical considerations, such as the return of company property. Employers should have a process in place for retrieving items such as keys, badges, company phones, or laptops. It’s beneficial to document the return of these items to prevent any disputes or misunderstandings down the line. Another important aspect is the handling of confidential information and the enforcement of any existing agreements, such as non-compete or non-disclosure agreements. Employers should remind employees of their obligations under these agreements and take steps to protect proprietary information and company interests.

Additionally, employers must be mindful of the legal claims following termination, especially if the termination could be perceived as wrongful or discriminatory. Ensuring that the termination process is conducted fairly, transparently, and in accordance with both federal and state laws is vital to minimizing legal risks. This includes documenting the reasons for termination, conducting exit interviews, and providing clear communication throughout the process.

Finally, employers should consider the impact of termination on remaining staff and take steps to address any concerns or morale issues. This might involve communicating in a manner that respects the privacy of the terminated employee while also addressing the needs of the team.

Legal Considerations During Termination in Ohio

Here’s an overview of important legal considerations during termination in Ohio:

  • Ohio Revised Code Section 4113.15 – Payment of Wages Upon Termination: Under the Ohio Revised Code Section 4113.15, employers are required to pay terminated employees all due wages by the next regular payday. This includes any accrued and unused vacation time if the employer’s policy or the employment contract provides for such payment. Compliance with this statute is critical to avoid disputes and potential penalties.
  • Ohio Civil Rights Act: The Ohio Civil Rights Act prohibits employment discrimination on the basis of race, color, religion, sex, national origin, disability, age, or ancestry. This law is particularly relevant during the termination process, as it protects employees from being terminated for discriminatory reasons. Employers must ensure that termination decisions are based on legitimate business reasons and are documented appropriately to defend against potential discrimination claims.
  • Ohio Unemployment Compensation Act: The Ohio Unemployment Compensation Act provides for the payment of unemployment benefits to eligible workers who are unemployed through no fault of their own. Employers should be aware that terminated employees may file for unemployment benefits and that the employer’s account may be charged. Providing accurate information regarding the reason for termination is crucial for the proper adjudication of unemployment claims.
  • Ohio Minimum Fair Wage Standards Act: While primarily focused on wage and hour laws, the Ohio Minimum Fair Wage Standards Act is relevant to the termination process insofar as ensuring that employees are paid appropriately for all hours worked up until the termination date, including overtime if applicable. Compliance with wage and hour laws up to the point of termination is essential to avoid claims for unpaid wages.
  • Worker Adjustment and Retraining Notification (WARN) Act – Ohio Application: While the WARN Act is a federal law, its application is relevant in Ohio for employers planning a mass layoff or plant closing. The Act requires employers with 100 or more employees to provide at least 60 days’ notice of the planned action. While Ohio does not have a state-specific WARN law, Ohio employers are subject to this federal requirement and must comply with its notice provisions.
  • Constructive Discharge Considerations: While not codified in a specific Ohio statute, the concept of constructive discharge is recognized in Ohio case law. Constructive discharge occurs when an employee resigns due to working conditions so intolerable that a reasonable person would feel compelled to quit. Employers should be mindful of the work environment and conditions leading up to a termination or resignation to avoid claims of constructive discharge.
  • Retaliation Protections: Various Ohio laws, including those related to workers’ compensation (Ohio Revised Code Section 4123.90) and whistleblower protections (Ohio Revised Code Section 4113.52), prohibit retaliation against employees for engaging in protected activities. It’s important for employers to ensure that termination decisions are not based on an employee’s lawful exercise of their rights under these and other statutes.

Bonus: Best Practices for Reducing Litigation Risks in Ohio

To effectively minimize litigation risks in the workplace, especially in a state with as diverse and complex employment laws as Ohio, employers must adopt a strategic approach. Here are some of the best practices tailored for employers in Ohio to reduce the likelihood of legal disputes:

  • Stay Informed About Legal Changes: Ohio’s laws and regulations are subject to change. Regularly updating your knowledge about these changes is crucial. Employers should subscribe to legal updates, attend relevant seminars, and consult with legal professionals to ensure compliance with new laws and regulations.
  • Implement Clear Employment Policies: Developing and maintaining clear, written policies on employment practices is essential. These policies should cover all aspects of employment, including hiring, disciplinary actions, termination processes, and anti-discrimination policies. Ensure that these documents are accessible to all employees and are reviewed regularly.
  • Conduct Regular Training: Both employers and employees should undergo regular training sessions focused on workplace laws, including harassment and discrimination prevention, workplace safety, and employment standards. Training helps in building a knowledgeable workforce that can recognize and prevent potential legal issues.
  • Document Everything: Documentation is a key factor in protecting your business from litigation. Keep detailed records of employee performance, including appraisals, complaints, disciplinary actions, and any steps taken to resolve issues. This documentation can be invaluable in defending against claims of wrongful termination or discrimination.
  • Foster Open Communication: Encourage an environment where employees feel comfortable discussing their concerns and grievances. Open lines of communication can often resolve issues before they escalate into legal disputes. Consider establishing an anonymous reporting system for employees to voice their concerns without fear of retaliation.
  • Review Contracts and Agreements: Ensure that all employment contracts and agreements are up to date and clearly outline the terms of employment, including roles, responsibilities, and conditions for termination. Regular review and revision of these documents can prevent misunderstandings and potential legal issues.
  • Engage in Fair Employment Practices: Adherence to fair employment practices is non-negotiable. This includes equitable hiring practices, unbiased disciplinary actions, and equal opportunities for advancement. Avoiding discrimination based on age, race, gender, religion, or any other protected characteristic is essential for reducing litigation risks.
  • Resolve Disputes Internally When Possible: Whenever possible, resolve employment disputes through internal processes before they escalate to legal action. Mediation and arbitration can be effective ways to address conflicts without the need for litigation, saving both time and resources.
  • Obtain Proper Insurance: Consider purchasing employment practices liability insurance (EPLI) to protect your business against potential lawsuits related to employment practices. This insurance can cover legal fees and settlements arising from claims of discrimination, harassment, wrongful termination, and other employment-related issues.
  • Consult with Legal Professionals: Regular consultation with legal professionals who specialize in employment law can provide invaluable guidance and help you navigate the complex landscape of legal compliance. They can offer proactive advice on reducing litigation risks and represent your interests effectively if legal issues arise.

Final Thoughts

In closing, firing an employee is a significant step that impacts both the individual and the organization. It’s a process that should be handled with care, fairness, and legality at its core. For employers in Ohio, the key to navigating this challenging terrain lies in preparation, clear policies, and compassionate execution. Ensuring these elements are in place not only aids in a smoother transition for all involved but also reinforces the integrity and values of the workplace.

Important Cautionary Note

This content is provided for informational purposes only. While we make every effort to ensure the accuracy of the information presented, we cannot guarantee that it is free of errors or omissions. Users are advised to independently verify any critical information and should not solely rely on the content provided.