Ohio’s new WARN Act: Key implications for franchisors and franchisees

January 7, 2026

Alert

Ohio employers, including franchisors, multi-unit franchisees, and single-location operators, now face new workforce reduction compliance requirements under Ohio’s mini-WARN statute. This law largely mirrors federal Worker Adjustment and Retraining Notification Act (WARN) requirements and regulations, but introduces several Ohio-specific provisions that are particularly relevant for franchise systems, especially during closures, non-renewals, restructurings, or distressed wind-downs.

This summary highlights the key changes, continuities, and critical compliance areas for franchise systems.

What are the basics of Ohio mini-WARN?

Effective September 29, 2025, Ohio’s state WARN law requires covered employers to comply with both federal WARN requirements and the related federal regulations in 20 C.F.R. Part 639. Ohio Mini-WARN, R.C. 4113.31. As a result, familiar concepts like “plant closing,” “mass layoff,” “employment loss,” “single site of employment,” and the 60-day notice rule are now explicitly part of Ohio law.

In addition, Ohio’s unemployment compensation statute requires employers to notify the DJFS at least three working days before any layoff or separation of 50 or more employees due to lack of work within any seven days. This notice requirement may apply even if federal or Ohio WARN laws do not.

Coverage: Who is a “covered employer” under Ohio mini-WARN?

Ohio largely adopts the federal WARN employer definition, generally, a business enterprise with 100+ employees (excluding part-time employees) or 100+ employees who collectively work at least 4,000 hours per week (exclusive of overtime).

In most franchise systems, the franchisee remains the employer of record and the entity that counts employees for threshold purposes. But Ohio’s new framework increases the need for franchisors to ensure franchisees know the rules, without “stepping into” operational control in a way that creates joint-employer evidence.

Where Ohio mini-WARN is broader than federal WARN

Ohio incorporates the federal WARN’s familiar triggers:

Plant closing: shutdown of a single site (or facility/unit within a site) that causes an “employment loss” for 50 or more employees (excluding part-time) at that site during a 30-day period.
Mass layoff: reduction in force (not a plant closing) causing an “employment loss” at a single site during a 30-day period for (i) 50 or more employees and 33% or more of the workforce (excluding part-time), or (ii) 500 or more employees (excluding part-time).

The Ohio “50-or-more layoffs” expansion

Ohio’s statute also provides that where an employer meets the 100 / 4,000-hours coverage test, notice is required if the employer lays off 50 or more employees at a single site during any 30-day period, language that can be read more broadly than the federal “mass layoff” definition (which generally requires the 33% component unless 500+ employees are affected).

This matters most for mid-sized multi-unit franchisees and franchisees operating distribution/commissary/shared-services locations, where a 50-person reduction at one Ohio site may trigger analysis even when federal WARN would not obviously apply.

Who must receive notice under Ohio mini-WARN?

Ohio’s mini-WARN requires notice to the same core groups as federal WARN, but it also codifies and emphasizes state and local recipients.

Notice generally goes to:

Affected employees’ bargaining representative (if any) or, if none, each affected employee;
The Director of Job and Family Services (DJFS), and
The chief elected official of the municipal corporation and the county where the closing/layoff will occur.

When must the notice be delivered?

Ohio mini-WARN: notice not less than 60 days before the plant closing or mass layoff.
Ohio unemployment compensation notice: DJFS notice at least three working days before the first separation/layoff when 50 or more are separated for lack of work within seven days.

Ohio does not mandate a unique delivery method, but by incorporating federal WARN regulations, it effectively accepts reasonable methods designed to ensure receipt (for example, first-class mail or personal delivery with optional signed receipt)

What challenges do franchisees and franchisors specifically face?

Franchise systems sit at a crossroads:

Franchise law often requires franchisors to maintain brand standards without controlling employment decisions, while
In practice, WARN analysis can determine who ordered, directed, or caused the employment loss.

Common franchise scenarios that raise WARN questions include:

A franchisee closes multiple Ohio locations or consolidates operations;
A franchisor terminates or non-renews a franchise agreement, leading to closure;
A distressed franchisee enters bankruptcy or winds down quickly; or
A system-wide restructuring affects shared services (commissary, distribution, call centers).

“Who is the employer? - default and risk factors

Default: the franchisee is usually the employer responsible for counting employees and issuing notices.
Where franchisors can create exposure: when the franchisor directs closures/layoffs, exercises non-customary control over employment decisions, operates as a liquidating fiduciary in a wind-down, or operationally integrates locations in ways that blur separateness.

Employee counting, “single site,” and aggregation in franchise networks

Ohio largely tracks federal WARN concepts (including the “single site of employment” framework), but Ohio’s broader 50-person trigger language increases pressure on franchisees to get the site analysis right.

For multi-unit franchisees, watch for:

Whether separate locations function as a single site (shared staffing, centralized scheduling, integrated operations);
Staggered reductions that may aggregate across the relevant measurement windows; and
Remote/shared employees (including multi-location roles) may complicate the “single site” determination.

For brand-wide networks, aggregation across different franchisees is typically not the starting assumption, but the risk increases if operations are centralized in ways that make multiple entities appear to be a single enterprise in practice.

What are the penalties and litigation exposure under Ohio mini-WARN?

Ohio mini-WARN incorporates federal WARN’s remedies by reference, and Ohio assigns administration to the ODJFS.
Ohio mini-WARN does not create a standalone private right of action under Ohio law.
Federal WARN still does (when federal WARN applies), meaning employees may still sue under federal law even if Ohio’s mini-WARN is administratively enforced.

In multi-defendant disputes (franchisee + franchisor), WARN allegations often travel with other claims (wage-hour, joint employment theories, tort or contract claims tied to closures). The best defense is a clean record showing: (1) correct threshold analysis, (2) correct recipients and timing, and (3) that the party issuing decisions and notices is the party that truly made the employment decisions.

What are the practical next steps for franchisors and franchisees?

Best practices for franchisors (reduce joint-employer evidence)

Provide general compliance guidance, not operational mandates on terminations/closures.
Avoid issuing WARN notices on behalf of franchisees.
Use written disclaimers reinforcing franchisee independence and responsibility for employment compliance.
Consider franchise agreement provisions requiring franchisees to:

-comply with WARN/mini-WARN laws,

-provide prompt notice to the franchisor of contemplated closures/layoffs, and

-indemnify for failures tied to franchisee-controlled employment decisions (as appropriate for the system).

Best practices for franchisees (reduce compliance misses)

Run WARN thresholds early (federal + Ohio mini-WARN + Ohio three-day DJFS rule).
Document who made the decision, when it was made, and why.
Map recipients (employees/representatives, DJFS, municipality, county) and tailor notice content to the audience.
Coordinate timing carefully, especially where closures occur in phases.

Ohio’s mini-WARN law generally follows the federal WARN framework, but it does introduce significant Ohio-specific compliance requirements, such as expanded notice recipients at the state and local levels, DJFS administration, and a broader trigger that could apply to certain reductions-in-force even when the federal “mass layoff” definition is not met. For franchise systems, it is crucial to not only determine when notice is required but also to coordinate planning and communication in ways that meet notice obligations, preserve franchisee independence, and reduce joint-employer risks.

If you have questions about Ohio WARN compliance, notice strategy, workforce reduction planning, or joint-employer risk in a franchise setting, please contact an attorney in our Franchising, Licensing and Distribution or Labor & Employment Practice Groups.

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