What’s In the New Law?
In December 2018, the Ohio Senate passed a bill 23-9, along party lines, declaring that corporate franchisors would be exempt from state labor violations. As a result of this bill’s passage, issues like minimum wage, overtime, income tax law, and unemployment compensation will all be the responsibility of the local franchisee, not the corporate parent company. This makes a big difference in potential funding for all kinds of employee issues.
This also affects workers’ compensation. If you work at a McDonald’s and suffer an injury on the job, it is the local franchisee that is responsible for your workers’ compensation coverage, not the McDonald’s corporation – and there’s a big difference in the potential payout from those two different companies.
What Are the Differing Perspectives on the Law?
Senator Frank LaRose (R-Hudson), now Ohio’s secretary of state, spoke to Cleveland.com about the bill, which he and other Senate Republicans supported. “The local franchise owner who operates a handful of restaurants in town is the one who hires the employees, sets the hours and ensures the employees are treated fairly.”
Policy Matters Ohio opposed the bill. Speaking on the group’s behalf, Hannah Halbert testified that the new HB 494 “will stick franchisees with the liability tab,” even though the corporate franchisor may control the working conditions in the restaurant or store.
How Does This Change Affect Ohio Workers?
This is particularly germane to discussions of workers’ comp, as claims may be based on unsafe working conditions. Is it more reasonable for the larger, parent company to be responsible for unsafe working conditions that possibly contributed to a workplace illness or injury, or more appropriate for the responsibility to rest with the smaller, local franchise owner? Workers compensation benefits do not hinge on proving that your employer has done anything wrong – even in a workplace with safe and reasonable working conditions, people can still become injured and be entitled to compensation for their costs and their lost wages.
The realm of work accident law can be complicated, especially when trying to determine who ultimately bears responsibility for caring for employees who have become injured on the job. Most injured workers would tell you that they’re less concerned with who pays for their medical bills and lost wages, and more concerned with whether or not they’re getting paid. But it’s definitely true that the bigger, wealthier parent corporations have more assets with which to contribute and pay for workplace injury expenses.
In Ohio, this bill changes the definition of “employer.” That definition now does not include “a franchisor with respect to the franchisor’s relationship with a franchisee or an employee of a franchisee, unless the franchisor exercises a type of degree of control over the franchisee or the franchisee’s employees that is not customarily exercised by a franchisor for the purpose of protection the franchisor’s trademark, brand, or both.” In short, for the purpose of workers compensation (and several other types of compensation, according to the law) the parent company of the franchise is not your “employer” – only the franchisee of the branch that you work at will have this distinction.
Confused yet? If you’re confused or concerned about your rights regarding workplace injuries in Ohio, you can call us here at CTBC to find out more about your responsibilities, your rights, and how to protect them. We can help you understand whether your workplace injury qualifies for workers compensation, help you with the process of accessing those benefits, and stay by your side throughout the process, even if there are roadblocks or rejections along the way. The road to accessing workers comp benefits can be a complex one, but you don’t have to travel it alone.