Ohio Senate Bill 396: What Employers Need to Know About Ohio’s Proposed Paid Family & Medical Leave Program
Ohio employers may soon be facing significant changes to leave administration. Introduced on March 23, 2026, Ohio Senate Bill 396 (SB 396) would establish a statewide Paid Family & Medical Leave (PFML) insurance program, providing eligible workers with paid, job-protected leave for qualifying family and medical reasons. The bill is currently under consideration in committee and has not been enacted into law.
If passed, SB 396 would represent one of the most substantial changes to Ohio leave management requirements in recent years, requiring employers to coordinate state-paid leave benefits alongside existing federal FMLA obligations and company leave policies.
What Is Senate Bill 396?
SB 396 would create a state-administered family and medical leave insurance program designed to provide partial wage replacement when employees need time away from work for qualifying personal or family circumstances. Unlike the federal Family and Medical Leave Act (FMLA), which provides eligible employees with unpaid leave, the proposed Ohio program would offer paid benefits funded through payroll contributions.
The program would be administered by the Ohio Department of Job and Family Services (ODJFS) and funded through a dedicated Family and Medical Leave Insurance Fund.
Key Benefits Under the Proposed Program
Under SB 396, eligible workers could receive:
- Up to 85% wage replacement based on their average weekly earnings
- Weekly benefits capped at a maximum amount established by the program
- Up to 14 weeks of leave for a qualifying event
- Up to 18 weeks of total leave benefits in a year
Job protection requiring employers to restore employees to the same or an equivalent position following approved leave.
These benefits would go beyond the federal FMLA, which generally provides up to 12 weeks of unpaid, job-protected leave for eligible employees.
Reasons Employees Could Use PFML Leave
The bill would cover many of the same circumstances currently recognized under FMLA, including:
- The employee’s own serious health condition
- Caring for a family member with a serious health condition
- Bonding with a newborn child
- Adoption or foster placement of a child
- Certain military-related family situations
For many Ohio workers who do not currently qualify for FMLA, the legislation could provide broader access to leave benefits and wage replacement.
How Would the Program Be Funded?
SB 396 proposes a social insurance model funded through payroll contributions from both employers and employees. Current estimates discussed by proponents suggest a contribution rate of approximately 0.4% of wages, split between employers and employees.
One notable exception would apply to smaller employers. Businesses with fewer than 15 employees would generally be exempt from the employer contribution requirement, although their employees would still contribute and remain eligible for benefits.
Private Plan Option
The legislation would allow employers to apply for approval of a private family and medical leave plan as an alternative to participating in the state-run program. Similar arrangements exist in several states that have implemented paid leave programs.
For employers already offering robust paid leave or disability benefits, the private plan option could become an important strategic consideration if the bill advances.
What Could This Mean for Ohio Employers?
While SB 396 remains a proposal, employers should understand the potential operational and financial implications.
Increased Administrative Responsibilities
If enacted, employers may need to:
- Implement payroll deduction processes
- Update leave policies and employee handbooks
- Coordinate PFML benefits with FMLA, disability, and company leave programs
- Track leave eligibility and usage
- Meet additional reporting and compliance requirements
Many employers are likely to find that leave administration becomes more complex as multiple leave laws and benefit programs overlap.
Financial Considerations
Employers with 15 or more employees could face additional payroll costs associated with required contributions. However, some organizations may also evaluate whether the state program could reduce costs currently associated with employer-funded paid leave or short-term disability benefits.
Workforce Management Challenges
Employers may need to plan for longer employee absences, adjust staffing strategies, and ensure supervisors understand how to properly administer leave requests while maintaining compliance.
Proposed Timeline
Although the bill is still in committee, discussions surrounding SB 396 have referenced a future implementation date as early as 2028, allowing time for the state to build the necessary administrative infrastructure and for employers to prepare for compliance requirements.
What Employers Should Do Now
SB 396 is far from becoming law, but Ohio employers should begin monitoring its progress. Organizations that proactively evaluate their leave administration processes, FMLA compliance programs, payroll systems, and employee benefit offerings will be better positioned if a statewide paid leave requirement moves forward.
For employers already struggling with leave administration, the proposal serves as a reminder that leave management is becoming increasingly complex. Having clear policies, consistent processes, and experienced leave administration support can help reduce compliance risk and improve the employee experience.
Final Thoughts
Ohio Senate Bill 396 reflects a growing national trend toward paid family and medical leave programs. If enacted, it would significantly expand paid leave benefits available to Ohio workers while introducing new compliance, payroll, and administrative requirements for employers. Though the proposal remains under legislative review, employers should stay informed and prepare for the possibility of significant changes to leave management in the years ahead.
Disclaimer: This article is for informational purposes only and reflects proposed legislation as of July 2026. SB 396 has not been enacted and may be amended before any final passage. Employers should consult legal counsel or leave administration experts regarding compliance obligations.
