Employment Law Updates Ohio Employees Should Know About in 2024
Between new legislation, proposed rules, and ballot initiatives, workers in the state of Ohio may be wondering how their own employment situations stack up against these evolutions in employment regulations. Read on to find 5 ways your employment may be affected in 2024 under these new developments:
Misclassification of Independent Contractor vs. Employee
Receiving a 1099 from your employer does not automatically make you an Independent Contractor under the Fair Labor Standards Act (FLSA). Your job duties dictate whether you are an independent contractor or an employee. Employers, under the FLSA, are held to standards in their treatment of employees. Independent Contractors, on the other hand, do not have such protections. The terms employee and independent contractor are not interchangeable. The current standing rule, issued by the Department of Labor’s Wage and Hour division, is known as the “economic reality test,” and went into effect March 8, 2021. This test determines whether a worker should be classified as an independent contractor or employee for the FLSA purposes. According to this current rule, there are 5 factors to consider when making such a decision: 2 of these factors are considered “core factors” and 3 are considered as being “less probative,” which means they carry less weight than the 2 core factors.
Under the current rule, if the 2 core factors point to you being an independent contractor, it is hard to overcome that conclusion even if all 3 of the less probative factors point to you being an employee (Independent Contractor Status, 2021).
However, there is a new rule that was proposed on October 13, 2022, related to the classification of employees vs. independent contractor. This new rule was proposed to “set forth an analysis for determining employee or independent contractor status under the [FLSA] that is more consistent with existing judicial precedent and […] longstanding guidance prior to the 2021 IC Rule” (Employee or Independent Contractor, 2022). This rule essentially rescinds the 2021 rule discussed above and modifies the economic reality test to encompass a more holistic overview of factors, rather than giving more weight to certain factors more than others. The test established by this rule includes 6 factors:
- Opportunity for Profit or Loss Depending on Managerial Skill
- Skill and Initiative
- Investments by the Worker and the Employer
- Extent to Which the Work Performed is an Integral Part of Employer’s Business
- Nature and Degree of Control
- Setting Price Rate
- Ability to Work for Others
- Degree of Permanence of Work Relationship
Should the proposed rule go into effect, workers currently classified as Independent Contractors due to the 2 Core Factors from the 2021 IC Rule may be found to truly be employees who are subject to FLSA regulations, including protections regarding minimum wage and premium overtime pay.
When you think you have been misclassified, The Friedmann Firm is here to help you assert your rights under the FLSA. We can analyze your job duties to determine if you are an independent contractor or employee.
Pregnant Workers Fairness Act (PWFA)
The Pregnant Workers Fairness Act (PWFA) went into effect on June 27, 2023; the EEOC (Equal Employment Opportunity Commission) proposed a rule to set regulations implementing this act on August 11, 2023. This act seeks to address gaps and limitations currently felt by those experiencing pregnancy, childbirth, or related medical conditions.
Up until now, some employees experiencing pregnancy, childbirth, or related medical conditions were able to bring claims against their employers under statutes like Title VII, the ADA, and the FMLA, but only if they met the criteria necessary under those statutes. The passage of the PWFA, however, means that there is new coverage for all workers experiencing pregnancy, childbirth, or related medical conditions.
The PWFA ensures that these types of workers are given the chance to access reasonable accommodations that help ease limitations related to their status and which allow them to remain employed. The act offers further protection by prohibiting retaliation against an individual who exercises their rights under the PWFA (Regulations to Implement the PWFA, 2023).
At The Friedmann Firm, we understand that pregnancy, childbirth, and related medical conditions can be tumultuous without interference from your employer; that is why we are here to sort through any difficulties you may experience on your behalf.
When onboarding with, working within, or separating from an employer, some employees are asked to sign a non-compete agreement or a contract containing a non-compete clause. These “non-competes” seek to establish a contractual obligation “that prevents the worker from seeking of accepting employment […] or operating a business”; they typically “block[…] the worker from working for a competing employer, or starting a competing business, within a certain geographic area and period of time after their employment ends” (Non-Compete Clause Rule, 2023).
However, the Federal Trade Commission (FTC) proposed a rule on January 3, 2023, concerning such agreements. This proposed new rule would make non-compete agreements a violation of anti-trust laws – it would rule that non-competes are an unfair method of competition. This has not happened yet but there is a general push to do away with non-compete agreements and the restrictions they impose. The rule does, of course, grant certain exceptions related to ownership and the buying/selling of a business. Another note on this proposed rule is that not only would it prevent employers from using non-competes, but it would also require current non-compete agreements to be rescinded. If passed, this would change the legal landscape related to non-compete agreements as we know it.
While this is still only a proposed rule, it sheds light on how complex employment agreements are, whether they are made pre-employment, during employment, or post-employment. Questions regarding the legal nature of these contracts can be complex; reach out to us at The Friedmann Firm to provide the clarity needed to feel confident about signing such agreements.
Clarification on Workplace Harassment
The Equal Employment Opportunity Commission – a federal agency tasked with enforcing federal laws regarding job discrimination and harassment – published a notice in the Federal Register on October 10, 2023, regarding its proposed “Enforcement Guidance on Harassment in the Workplace.” This proposed guide is “intended to provide clarity to the public regarding Commission policies and existing requirements under the law,” especially regarding “employer liability applicable to claims of harassment” (Proposed Enforcement Guidance, 2023). While it may seem like this would only interest employers, you as an employee should also understand just what you can expect from your employer when it comes to situations of harassment in the workplace.
There are 3 types of things that employers may be held liable for depending on who is harassing you; a standard of automatic liability if the harasser is a “proxy or alter ego of the employer,” a standard of either automatic liability OR disproving the Faragher-Ellerth affirmative defense is the harasser is a “supervisor,”
or a standard of negligence if the harasser is a “non-supervisory employee[…], coworker[…], [or] non- employee[…]” (Proposed Enforcement Guidance, 2023).
As seen by the different standards provided in this new guidance to be issued, harassment is a complex issue in the workplace; the Friedmann Firm is here to help you sort through this situation and hold accountable those who are liable.
Drug Testing – What’s New Since Issue 2?
A ballot proposal for Ohio, known as Issue 2, recently passed during the November 2023 election. This ballot proposal sought “To Commercialize, Regulate, Legalize, and Tax the Adult Use of Cannabis” in Ohio, and having passed, it went into effect December 7, 2023.
But what does this mean for employees?
In truth, not much will change after the passing of Issue 2. The statute it enacts, Chapter 3780 of the Ohio Revised Code, specifically addresses the rights of employers. The reason that not much will change is that marijuana is still federally illegal. Just because Ohio allows for the sale of marijuana and/or allows Ohioans to utilize a medical marijuana card, does NOT mean that employers have to permit employees to use marijuana, even if that person has a medical card.
Here is what your employer CAN do under the new statute:
- Refuse to accommodate an employee’s use of cannabis
- Refuse to hire a potential employee; discharge a current employee; or discipline a current employee due to cannabis us
- Enforce a drug testing policy, a drug-free workplace policy, or a zero-tolerance drug policy (Ohio Rev. Code, § 3780.35)
ORC 3780 does not allow individuals “to commence a cause of action against an employer for refusing to hire, discharging, disciplining, discriminating, [or] retaliating […] against an individual […] related to the individual’s use of cannabis” (Ohio Rev. Code, § 3780.35).
While it may be that cannabis use is no longer a criminal offense in the state of Ohio, employers are still able to make decisions affecting your employment based upon your use of cannabis.
- Employee or Independent Contractor Classification Under the Fair Labor Standards Act, 87 Fed. Reg. 62218 (October 13, 2022) (amending 29 C.F.R. § 780, 29 C.F.R. § 788, & 29 C.F.R. § 795).
- Independent Contractor Status Under the Fair Labor Standards Act, 86 Fed. Reg. 1168 (January 7, 2021) (amending 29 C.F.R. § 780, 29 C.F.R. § 788, & 29 C.F.R. § 795).
- Proposed Enforcement Guidance on Harassment in the Workplace, 88 Fed. Reg. 67750 (October 2, 2023).
- Non-Compete Clause Rule, 88 Fed. Reg. 3482 (January 19, 2023) (amending 16 C.F.R. § 910). Ohio Rev. Code, § 3780.35
- Regulations To Implement the Pregnant Workers Fairness Act, 88 Fed. Reg. 54714 (August 11, 2023) (amending 29 C.F.R. § 1636).
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