On April 23, 2026, Ohio state Senators Beth Liston (D-Dublin) and Louis W. Blessing III (R-Colerain Township) introduced Senate Bill 396 (SB 396), a bipartisan proposal that would, if enacted, establish a statewide paid family and medical leave insurance program administered by the Ohio Department of Job and Family Services. The bill has been referred to the Senate Financial Institutions, Insurance and Technology Committee and, as of this writing, has not yet been scheduled for a hearing.
As currently drafted, SB 396 reflects the structure of paid leave programs adopted in numerous other states where we regularly advise clients large and small. While prior versions of similar legislation have not advanced in Ohio, the bill’s bipartisan sponsorship increases the likelihood of substantive legislative consideration. Employers should evaluate the proposal now to understand potential operational, financial and compliance implications. If and when enacted, there is certain to be significant operational changes to consider and implement.
Background
Ohio remains among a shrinking number of states without a state-administered paid family and medical leave program. According to data cited by the bill’s sponsors, a significant portion of the state’s workforce lacks access to employer-provided paid leave. SB 396 is intended to address that gap through a social insurance model funded by payroll contributions from employers and employees, with benefits administered at the state level.
Key Provisions
Program Administration.
SB 396 would create a family and medical leave insurance fund overseen by the Director of the Ohio Department of Job and Family Services. Employers meeting applicable thresholds would be required to contribute to the fund. The bill also proposes a mechanism for employers to apply for approval to provide benefits through a private plan in lieu of participating in the state program. Based on analogous programs in other jurisdictions, employers pursuing this option should anticipate actuarial equivalency requirements, reporting obligations and ongoing administrative oversight.
Covered Employers and Employees.
The bill defines “employer” broadly to include any person employing one or more individuals. However, the contribution requirement would apply only to employers with 15 or more employees. As drafted, this distinction suggests that smaller employers may still be subject to certain administrative or compliance obligations, even if they are not required to contribute financially to the program.
Qualifying Reasons for Leave.
Eligible employees would be entitled to benefits for leave taken to: (1) Address their own serious health condition that renders them unable to perform job functions; (2) Care for a new child during the first year following birth, adoption, or placement; (3) Care for a family member with a serious health condition; or (4) Respond to a qualifying military exigency arising from a family member’s covered active duty.
Duration of Benefits.
The bill proposes up to 14 weeks of benefits per qualifying event within a defined 12-month application period (to be further clarified through rulemaking). Employees experiencing multiple qualifying events in the same period could receive up to 18 total weeks of benefits.
Benefit Amount.
Weekly benefits would be calculated as a percentage of an employee’s average weekly wage, up to 85%, subject to a cap tied to a percentage of the statewide average weekly wage. The precise formula and cap structure may be refined through the legislative process or implementing regulations. Benefits would be reduced by amounts received through other wage-replacement programs, such as workers’ compensation or unemployment compensation.
Payroll Contributions.
The program would be funded through payroll contributions initially estimated at approximately 0.4% of wages, with the employer-employee allocation to be determined by the Director through rulemaking. That rate may be adjusted over time based on program funding needs and actuarial experience.
Eligibility Requirements.
To qualify for benefits, employees would need to have earned at least $2,500 in wages during a base period defined as the first four of the last five completed calendar quarters preceding the application year.
Notice Requirements.
Employers could not require more than 30 days’ advance notice when the need for leave is foreseeable. When leave is not foreseeable, employees would be required to provide notice as soon as practicable. The Director would be required to notify employers within five business days after a claim is filed.
Health Insurance Continuation.
Employers would be required to maintain group health insurance coverage during the leave period under the same terms that would have applied had the employee continued working.
Job Protection.
The bill provides that employees returning from covered leave would be entitled to reinstatement to their prior position or an equivalent position with the same compensation, benefits, and terms and conditions of employment, subject to any eligibility limitations or clarifications that may emerge through amendments or rulemaking.
Interaction with Federal and Employer-Provided Leave.
Leave under SB 396 would run concurrently with leave taken under the federal Family and Medical Leave Act (FMLA), to the extent the leave qualifies under both laws. Employers may also require concurrent use of leave provided under collective bargaining agreements or employer policies. However, employees could not be required to exhaust accrued paid time off, though they may elect to do so voluntarily. Employers would still need to comply independently with FMLA notice, designation, and administrative requirements.
What’s Next for Employers
While the current draft does not fully detail enforcement mechanisms, similar programs in other states include anti-retaliation provisions, administrative enforcement authority and penalties for noncompliance. Employers should anticipate that such provisions may be incorporated as the bill advances. Although SB 396 remains in the early stages of the legislative process, its structure and sponsorship warrant proactive evaluation. Employers should consider taking the following steps:
- Review existing leave programs. Compare current paid leave, short-term disability, and FMLA practices against the framework proposed in SB 396, particularly with respect to benefit levels, job protection, and coordination of leave.
- Evaluate financial exposure. Model the potential impact of payroll contributions based on current wage data, recognizing that contribution rates and allocation may change through rulemaking.
- Assess private plan feasibility. Employers with robust existing leave benefits should evaluate whether a private plan approach could meet anticipated equivalency and administrative requirements.
- Audit multi-state obligations. Employers operating across multiple jurisdictions should analyze how an Ohio program would interact with existing state and local paid leave mandates.
- Track legislative developments. Committee activity, amendments, and stakeholder input will shape the bill’s final form. Monitoring these developments will be critical to timely compliance planning.
Additional operational compliance considerations that will face businesses large and small include:
- Payroll system changes
- Coordination with disability plans
- Multi-state complexity conflicts
- Potential employee misuse/fraud controls
We certainly don’t advise overacting to these potential changes until the law is settled and rulemaking is completed, but they are all worth keeping on the radar and in sight on the horizon.
Closing Thoughts
SB 396 reflects a broader national movement toward state-administered paid leave programs and signals that similar legislation is likely to remain a recurring policy priority in Ohio. Employers that begin evaluating the proposal now will be better positioned to respond effectively if the bill advances.
KJK’s Labor & Employment attorneys will continue to monitor SB 396 and provide updates as the legislation advances. If you have questions about how this bill could affect your business, or would like to review your current leave policies in light of this development, please contact Dave Campbell at JDC@kjk.com.