Cuyahoga Court Enforces Cognovit Note Against Employee for Employer's Training Expenses

 In October, I reported that the Cuyahoga Court of Appeals had enforced an employer's hiring bonus agreement and required the former employee to repay it when he had resigned before completing training and within 18 months of being hired.   In November, the Cuyahoga County Court of Appeals affirmed enforcement of a $10K cognovit note signed by an employee agreeing to repay training costs incurred by the employer if she resigned within two years of being hired.  Overdrive Espresso, L.L.C. v. Finein, 2025-Ohio-5226.  The Court concluded that it could not "say that this transaction, arising out of employment contract, was a consumer transaction as defined under R.C. 2323.13(E)."  Because her remaining defenses went to enforceability of the note and not to its creation or calculation of the underlying debt, they were invalid. 

According to the Court's opinion, the employee was hired in April 2022 and the employer incurred $10K to obtain specialized training for her.  Accordingly, she was required to sign a cognovit note promising to repay within 30 days that $10K training expense plus 10% interest and collection costs  if she was terminated before April 2024 or a judgment would be confessed against her in court.  She resigned in December 2023 and had not repaid the training expense before February.  A complained was filed and an answer filed on her behalf pursuant to the cognovit agreement admitting to the allegations and confessing judgment.  Judgment was entered in favor of the employer the same day (as is typical). She failed to file a timely employee and, instead, employee sought relief from judgment, which was denied.  The Court of Appeals affirmed. 

Motions for relief from judgment under Civil Rule 60 are evaluated only for abuse of discretion. 

 “‘A cognovit promissory note is a special type of commercial paper by which a debtor authorizes a creditor, in the event of the debtor’s default on his payment obligation, to obtain an immediate judgment against him without prior notice or an opportunity to be heard.’”  . . .  “‘The purpose of a cognovit note is to allow the holder of the note to quickly obtain judgment, without the possibility of a trial.’” . . . As such, “when a debtor signs a cognovit note, the debtor relinquishes the possibility of notice, hearing, or appearance at an action to collect in the event of nonpayment on the note.”

As a result, Ohio courts have determined that in such cases where the party had never had the opportunity to be heard in a cognovit note proceeding, their burden is lessened when moving for relief for judgment under Civ.R. 60(B).  . . .  “Therefore, ‘a movant who files for relief from a judgment taken upon a cognovit note need only establish (1) a meritorious defense and (2) that the motion was timely made.’”

Under Civ.R. 60(B), the “‘moving party need only to allege a meritorious defense; it need not prove that it will prevail on that defense.’”  . . .  Although proof of success is not required, “the moving party still needs to allege operative facts with enough specificity to allow the trial court to decide whether a meritorious defense exists.”  . . . And the “movant must provide evidentiary material supporting his or her Civ.R. 60(B) motion.”  . . . These evidentiary materials “‘must present operative facts and not mere general allegations to justify relief.’” 

This court has recognized that “[t]he defenses available to the maker of a cognovit note are extremely limited. The ‘defense of non-default’ is certainly one.”  . . . . But “the defense of non-default is not the only meritorious defense recognized by courts as being available to a cognovit judgment debtor seeking Civ.R. 60(B) relief[;] in general, a judgment on a cognovit note will ‘not be vacated for reasons which do not encompass such matters of integrity and validity.’”  . . . For instance, other meritorious defenses may include “‘improper conduct in obtaining the debtor’s signature on the note; deviation from proper procedures in confessing judgment on the note; and miscalculation of the amount remaining due on the note at the time of confession of judgment.’”  . . . In short, “a meritorious defense is one that goes to the integrity and validity of the creation of the debt or note, the state of the underlying debt at the time of confession of judgment, or the procedure utilized in the confession of judgment on the note.”

The Court rejected the employee's argument that this transaction was a consumer rather than a commercial transaction.  

R.C. 2323.13(E) provides that “[a] warrant of attorney to confess judgment . . . arising out of a consumer loan or consumer transaction, is invalid and the court shall have no jurisdiction to render a judgment based upon such a warrant.” As such, in cases where a note arises out of a consumer loan or consumer transaction a common pleas court lacks jurisdiction to enter a cognovit judgment against the defendant.  ... 

         . . . 

 R.C. 2323.13(E)(2) defines a “consumer transaction” as “a sale, lease, assignment, award by chance, or other transfer of an item of goods, a service, franchise, or an intangible, to an individual for purposes that are primarily personal, family, educational, or household.”  . . .. 

             . . . .  

Here, the cognovit note arose out of an employment contract between [plaintiff] and [employer], wherein [she] agreed to reimburse [it] for the total expense of training costs in the amount of $10,000 if she voluntarily quit or breached the contract within two years of signing the employment agreement. The agreement, which was signed by both parties, provided, in relevant part, that ““[s]imultaneous with the execution of this Employment Agreement, the Employee [Finein] shall execute and deliver to the Company [Overdrive] a written Cognovit Promissory Note for the Training Cost . . . .” The note was executed for the agreed upon training cost of $10,000. 

[She[ does not direct us to any authority holding that a cognovit note arising out of an employment contract is considered a consumer transaction. Rather, it is clear from the contract that the primary purpose of the training received by [her] was not personal, but as a condition of her employment with [the employer]. This is further evidenced by the fact that [the employer] sought to protect its investment by requiring [her] to remain employed for a period of two years. Thus, we cannot say that this transaction, arising out of employment contract, was a consumer transaction as defined under R.C. 2323.13(E).

The Court concluded that the remaining defenses did not go to the validity of the note, but rather, to its enforcement which could not be challenged at this point:

[Her] remaining claims challenge the enforceability of the cognovit note under New York law and federal law. [She] also challenges whether the amount owed on the note adequately represents the training costs incurred by [the employer]. None of these defenses allege improper conduct in obtaining the debtor’s signature on the note; a deviation from proper procedures in confessing judgment on the note; or a miscalculation of the amount remaining due on the note at the time of confession of judgment.  . . .  As discussed above, “a meritorious defense is one that goes to the integrity and validity of the creation of the debt or note, the state of the underlying debt at the time of confession of judgment, or the procedure utilized in the confession of judgment on the note.”  . . . Since none of [her] remaining claims amount to a meritorious defense to a cognovit note, the trial court did not abuse its discretion in rejecting these claims. 

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.

Gray v State Farm Was Amended to Clarify Cat's Paw Theory and Breaks in Causation

 In August, I posted about an interesting Cat’s Paw theory case, Gray v. State Farm Mutual Auto. Ins. Co.,  (6^th Cir. 2025), where the Sixth Circuit reversed an employer's summary judgement due to possible selective enforcement of a time card fraud policy by a manager in retaliation for the plaintiff's prior protected conduct. 

As I briefly explained:

In July, the Sixth Circuit reversed an employer’s summary judgment on a retaliation claim where the plaintiff claimed that she was investigated and then fired in retaliation for assisting a co-worker assert her rights under the ADA and be transferred away from her discriminatory supervisor.  Gray v. State Farm Mutual Auto. Ins. Co., 145 F.4th 630 (6^th Cir. 2025).   When her co-worker’s discriminatory supervisor filled in for the plaintiff’s supervisor shortly after the protected conduct, he launched an unprompted and unprecedented investigation into the plaintiff’s time cards by comparing them to her computer use.  No other employee was investigated – despite similar discrepancies -- and the plaintiff was ultimately fired for time card abuse.  

The Court agreed that the evidence aligned with its precedent holding that “employees can establish prima facie causation by showing that their employer began scrutinizing them more heavily shortly after they engaged in protected activity, and then used its findings to justify termination.” The plaintiff was able to show that the discriminatory supervisor knew of her assistance to her co-worker and his retaliatory intent under a “cat’s paw” theory of vicarious liability. 

While the employer may have avoided direct liability under an honest belief theory, the supervisor’s actions could not. A “supervisor does not have to lie in order to be biased. As we have repeatedly recognized, a supervisor can cause an employee’s termination by reporting true yet selective information.”  Moreover, although “an employer can escape liability by conducting ‘an in-depth and truly independent investigation’ into an otherwise biased report,  . . . when a supervisor reports true but selective information, an investigation will always confirm the supervisor’s allegation.”  In this case, the employer and HR failed to take the plaintiff’s complaint of retaliation seriously or to compare her misconduct to other employees before terminating her employment.

The Court then held a re-hearing and amended its decision and dissent in December.   Gray v. State Farm Mutual Auto. Ins. Co., 159 F.4th 1024 (6th Cir. 2025).   Here is some of the additional text that was then added to its decision (emphasis added):

A simple example illustrates why. Imagine a workplace where five employees were engaged in the same pattern of misconduct. If a supervisor made a true but selective report of wrongdoing against one of the five employees because of that employee's race, they would be attempting to use the company's human resources as the "conduit" for their bias. See Romans v. Michigan Dep't of Hum. Services, 668 F.3d 826, 835 (6th Cir. 2012). If human resources then opened an independent investigation into that one employee, it would confirm the biased report, but it would not necessarily negate the supervisor's bias in singling out one employee based on race. That's why the Supreme Court "declined to adopt [] a hard-and-fast rule" that "an independent investigation has a claim-preclusive effect" or "somehow relieves the employer of 'fault.'" Staub, 562 U.S. at 420-21.

              . . . 

Our decision today does not impose a bright-line rule that a supervisor's true-but selective report will always be the proximate cause of any subsequent adverse employment action. Rather, we simply echo Staub's holding that a subsequent investigation that does nothing more than confirm a supervisor's true-but-selective report is by itself insufficient to break the chain of proximate causation.  . . . . An employer can still negate causation by establishing that "the employer's investigation result[ed] in an adverse action for reasons unrelated to the supervisor's original biased action."  . . . . . Put another way, an employer will not be liable if its investigation uncovers a superseding "cause of independent origin that was not foreseeable" from the supervisor's biased action . . .

We have previously held that the existence of a superseding cause is a question of fact.  . . .

Here, the undisputed record shows that [the manager] reported [the plaintiff] for "manually changing" her time entries and identified three discrepancies as proof of that fact. [The employer’s] HR employee,  . . . , thereafter conducted her own investigation that revealed additional discrepancies beyond the three identified by [the manager], including instances where [the plaintiff] reported working while she was not in the building. [The employer] claims that it fired [her] based on these additional out-of building discrepancies. On summary judgment, the question that we must answer is whether [her] termination based on these additional discrepancies was so "unrelated" to [his] original report and so "not foreseeable" by him that no reasonable factfinder could find proximate causation.

We hold that this question cannot be answered as a matter of law. [The manager] reported generally that [the plaintiff] was "manually changing" her time, not that she had done so only in the three instances that he identified. He also falsely informed [HR] that [she] had previously been reprimanded for similar conduct, suggesting that his report concerned a broad pattern of timekeeping issues. And he suggested in his report to HR that an investigation of [her] would uncover additional timekeeping errors. Given that [his] report and [her] termination both related to [her] timekeeping entries, a reasonable jury could find that the former improperly influenced—and was a proximate cause of—the latter.

Our decision in Romans does not counsel otherwise. Romans does not stand for the proposition that an independent investigation always breaks the chain of causation. Nor could it after the Supreme Court's rejection of that argument in Staub. It instead held that the independent investigation broke the causal chain because of the particular facts at issue in that case. There, the decisionmaker expressly disclaimed reliance on an allegedly biased report and conducted a separate investigation into the plaintiff's alleged misconduct.  . . . . The separate investigation found that the plaintiff had "violated four work rules, only one of which was related to [the allegedly biased] report, and each of which would have individually supported a termination."  . . . Therefore, Romans falls comfortably within the scenario delineated in Staub where an independent investigation "results in an adverse action for reasons unrelated to the supervisor's original biased action."  . . .

By contrast, here, [the employer] relied on [the manager’s] report and opened an investigation that confirmed his allegations. [It] then took the adverse action that [his] report was "designed and intended" to produce by firing [her] for timekeeping discrepancies.  . . . . So a jury could conclude that [its] investigation took into account [his] biased report and failed to determine that the adverse action was justified apart from his recommendation.  . . . . Romans supports rather than undermines this analysis.

The  dissent continued to elaborate why the  independent investigation by HR, which uncovered additional and more sever timekeeping violations, should have resulted in summary judgment as breaking the cat’s paw causation. 

 

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.

Sixth Circuit Upholds Termination for Time Card Fraud Despite Cat's Paw Theory or Suspicious Timing

Yesterday, the Sixth Circuit Court of Appeals affirmed an employer’s summary judgment for terminating an employee for time-card fraud despite his arguments about failure to accommodate, retaliation and a cat’s paw theory that was remarkably similar to an earlier decision in   Gray v. State Farm Mutual Auto. Ins. Co., 159 F.4th 1024 (6^th Cir. 2025) (finding possible selective enforcement of time card fraud policy in cat’s paw retaliation case).   Shears v. FirstEnergy Corp., No. 24-3915 (6^th Cir. 1/5/26).  The Shears Court rejected the plaintiff’s assertion for the first time on appeal that his misconduct was caused by brain fog from his known disability and should have been accommodated.  The Court rejected all retaliation claims, regardless of the suspicious timing, because there was insufficient evidence of pretext, such as comparators receiving better treatment, knowledge by the initiating manager of prior protected activity or deviation from policy, etc.  The employer also conducted several reasonable investigations, entitling it to the honest belief defense.   Unlike the Gray case, there was apparently insufficient evidence presented to the trial court about selective investigation of time card fraud.

According to the Court’s decision, Plaintiff was diagnosed with Type 2 diabetes in 2012 and had been granted an accommodation to work only days from 2012 to March 2019. In  January 2019, he  assisted co-workers with sexual harassment complaints against his manager.  There was no evidence that the manager was aware of this.  During a work emergency, his manager assigned him to work nights again despite his complaints until he mentioned his diabetes and was requested to provide medical documentation.  He did in April and was immediately returned to day shift.  Afterwards, his manager investigated and discovered time card discrepancies ranging from 36-106 minutes during March 2019.  These were investigated and confirmed by his director, HR and a separate safety committee.  Plaintiff was interviewed several times and apparently never claimed retaliation or different scrutiny. He was fired in May 2019.   

The trial court granted summary judgment to the employer.  Employer was granted summary judgment.  The employer articulated a legitimate basis to terminate him for time card fraud, and the plaintiff never disputed that he had had not entered the plant at times he had reported being at work. The employer was also entitled to the honest belief defense because it had conducted several reasonable investigations to confirm the facts and given him the opportunity to respond. 

The courts rejected his reasonable accommodation claims.  First, he had failed to show any unreasonable delay in March when the employer was entitled to medical documentation and immediately provided his requested accommodation once he produced it and abandoned this theory on appeal.  It also rejected his new argument that his discrepancies were caused by brain fog from his known diabetes because “a failure-to-accommodate claim requires proof that the employer denied a reasonable accommodation—not that it disciplined or discharged an employee whose disability allegedly contributed to the underlying conduct.”  It found that he failed to prove this theory and found his cited cases distinguishable.  What the Court did not note is that the EEOC Guidance from 2008 had previously provided that an employer is not required to accommodate misconduct caused by a disability unless the employee had put the employer on notice of the need for an accommodation of that issue: 

When an employee does not give notice of the need for accommodation until after a performance problem has occurred, reasonable accommodation does not require that the employer   . . . tolerate or excuse the poor performance; . . . withhold disciplinary action (including termination) warranted by the poor performance . . . .

The Court also rejected the ADA retaliation because he could not show pretext when admitting the time card discrepancies and without similarly situated comparators who were treated better.  His excuses for his actions did not dispute the action and the employer not required to believe his “honest mistake” defense.   He might have prima facie case from the timing of his termination compared to his request to return to the day shift, but he lacked evidence of pretext to rebut the intervening causation factor of his time card fraud.

The Court also rejected his Cat’s Paw Theory because there was apparently no evidence that his manager was aware about his prior protected Title VII conduct in assisting his co-workers sexual harassment allegations.  There were also independent investigations and plaintiff had insufficient evidence that other employees engaged in similar misconduct without being fired or that he had ever alleged such similar misconduct during the employer’s multiple investigations and interviews.   In other words, there was insufficient evidence of selective enforcement by his manager of the time card fraud issues to support a cat’s paw theory.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.

Sixth Circuit Rejects ADA Accommodation and Interactive Process Claims When Request to Sit Every 10 Minutes Was Unreasonable on its Face

Earlier this month, the Sixth Circuit Court of Appeals affirmed an employer’s summary judgment on an ADA claim on the grounds that the requested accommodation was unreasonable on its face, meaning that the employer did not have to even engage in the interactive process or grant the requested accommodation.   Bowles v. SSRG II, LLC, No. 25-5329 (6^th Cir. 12-17-25).   The newly-hired  fast-casual restaurant cashier had requested the right to sit for five minutes every time that she had to stand for 10 minutes because of arthritis in her knees.  The undisputed facts showed that the essential functions of the job required multi-tasking and spending the majority of time standing and walking.  There were no “standalone register-only” positions.

According to the Court’s opinion, the plaintiff was hired for a cashier position.  This required her to take orders for dine-in and carry-out, fill drink orders, stocking the drink station and refrigeration station, expediting food orders, delivering items to eat-in customers, clean tables, vacuum, etc. in a fast-paced environment.   “Those features made multitasking essential.”  During the application process, she had disclosed her disability and that she would need to periodically sit if required to stand for long periods of time and was hired anyway. 

During her orientation, the plaintiff disclosed that she would need to sit when needed or to sit and work. HR delayed her start date pending medical documentation, which initially indicated only that she would need a chair because of her arthritis.  HR then requested to know how long she could stand and how often she would need to sit, etc.   The plaintiff responded that she could only stand for 10 minutes at a time and then would need to sit for 5 minutes.   HR responded that there were no sitting positions.

The Court rejected the employee’s failure to accommodate claim for failing to specify a reasonable accommodation:

[Her] claim stumbles from the start, as she did not satisfy her initial burden of showing that her proposed accommodation—being able to sit for five minutes after every ten minutes of standing—is objectively reasonable, accounting for the essential requirements of the cashier/service-team member role  . . . .

 . . .

Juxtapose these critical job duties with what [she] requested: the ability to sit in one location for a duration of five minutes—presumably in front a cash register—after standing for ten. [Her] request would necessarily change the nature of the cashier/service-team member position. For a third of her shift, [her] job would be isolated to manning the cash register, regardless of whether there was a customer waiting at the register. And during those periods, [she] would be unable to tackle numerous duties, from greeting a customer at the door to rushing an order out to a hungry patron to cleaning up a spill at the drink station, just to name a few, any of which could occur at a moment’s notice in the setting of a fast-casual restaurant. This collection of duties is why [the employer] requires both multitasking and mobility from its team members.

The plaintiff attempted to argue that she was only hired to be a cashier and not to multi-task.

The problem for [the plaintiff] is that there is no evidence that she was hired for a standalone register-only position. In fact, no such position existed at the restaurant. The only position identified in the record is the cashier/service-team member role. And its written job description and the deposition testimony presented at summary judgment show that the role was far more than a limited, register-centric job. True, both [the restaurant’s] employees as well as [the plaintiff] referred to the position colloquially as the “cashier” role. But the position’s name, either formal or informal, is far less meaningful than its critical functions. As we engage in the “highly fact specific” inquiry into what is an essential function,  . . .a job title alone tells us very little, . . .

The Court also rejected her argument that her earlier requests to sit periodically should have been given more weight than her last, more specific request.   It distinguished other cashier cases where the plaintiff’s station was stationery, rather than fluid. 

 . . . requiring a duration of five minutes of sitting after standing for ten is what makes [her] request facially unreasonable. Meeting those terms would alter essential functions of the cashier/service-team member position while foisting added duties on co-workers when [she] manned the cash register. Perhaps, as [she] emphasizes, she could perform some tasks during her time standing. But that misses the point. The nature of the job—working in the front of the house at a fast-casual restaurant— necessarily means that a given task could crop up at any time. In one minute, the kitchen might have prepared a food order to run out to a customer. The next, a customer might finish her meal, leaving a messy table behind. And a minute later, the beverage station or refrigerator may need restocking. Had [the employer] granted [her] accommodation, all of those tasks would go unattended by [her] while she sat at the cash register, despite her position’s essential requirements and the restaurant’s needs.

The Court also refused to assign the “reasonableness” of the request to a jury determination:

While there undoubtedly are cases where disputes of fact arise over what a job entails and whether an accommodation would interfere with core functions of that job, in the end, disputes over both issues involve a mixed question of law and fact.  . . .  And it is appropriate for us to resolve these mixed questions at summary judgment when there are few evidentiary disputes over the material facts. . . .  That is the case here. There is no evidentiary dispute as to the essential functions of the cashier/service-team member position. Nor is there a dispute over the nature of [her] proposed accommodation. As a result, we follow the well-trodden path of determining as a matter of law whether [her] proposed accommodation is a facially reasonable one.

The Court also rejected her allegation that the employer failed to engage in the interactive process.  Rather than address the employer’s request for medical information, it concluded that no interaction was required when the requested accommodation was unreasonable on its face:

a viable interactive-process claim presupposes the existence of a reasonable accommodation. And with [her] having presented a facially unreasonable request to [the employer], her remaining claim necessarily fails.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.

Ohio Enacts E-Verify Workforce Integrity Act for Non-residential Construction Employers Beginning in March 2026

 Last week, Governor DeWine signed into law House Bill 264, the E-Verify Workforce Integrity Act,  which requires most non-residential construction contractors to utilize e-verify to confirm the legal work status of employees at Ohio Revised Code §§4151.01 et seq.  The Act prohibits employers from continuing to employ individuals whose legal work status has not been confirmed by e-verify.  The Attorney General shall enforce the provisions, and can receive anonymous complaints, but will not base an investigation on race, color or national origin.   Notably, there is no deadline to utilize e-verify  (but employers are required under federal law to complete I-9 forms within 3 days of hire) and the Act does not address the use of day laborers.  Violating employers can be fined and barred from state contracts for a period of time.  Knowing violations can result in the revocation of any required license to conduct business.   Covered employers must maintain their records for at least three years.  The Act becomes effective on March 19, 2026.

Key terms of the legislation include:

·       Sec. 4151.02. (A) Except as provided in division (C) of this section, no nonresidential construction contractor, subcontractor, or labor broker shall fail to verify the employment eligibility of each employee hired to perform work on a nonresidential construction project through the e verify program. A nonresidential construction contractor shall use e-verify to confirm the identity and legal working status of each employee employed by the nonresidential construction contractor. A subcontractor shall use e-verify to confirm the identity and legal working status of each employee employed by the subcontractor. A labor broker shall use e-verify to confirm the identity and legal working status of each employee employed by the labor broker.

·        (B) A nonresidential construction contractor, subcontractor, or labor broker shall keep a record of the verification required by division (A) of this section for three years after the date of hire or one year after the date the employee's employment is terminated, whichever is later.

·       (C) A nonresidential construction contractor, subcontractor, or labor broker is not required to comply with division (A) of this section if both of the following apply: (1) The nonresidential construction contractor, subcontractor, or labor broker has previously verified an employee's employment eligibility using e-verify. (2) The employer is not required to verify or reverify the employee's eligibility to work under section 101(a)(1) of the federal "Immigration Reform and Control Act of 1986," 8 U.S.C. 1324a(b). Sec. 4151.03.

·       No nonresidential construction contractor, subcontractor, or labor broker shall continue to employ an individual after receiving a notice of final nonconfirmation for that individual from the e-verify program. For purposes of this section, a final nonconfirmation occurs when the contractor, subcontractor, or labor broker receives a case result indicating that an employee's employment eligibility could not be confirmed and instructions that the contractor, subcontractor, or Sub. H. B. No. 246 136th G.A. 3 labor broker should close the e-verify case associated with the employee.

·       (C) "Employee" means any individual who performs services for a contractor, subcontractor, or labor broker who satisfies both of the following conditions: (1) The individual is subject to the contractor's, subcontractor's, or labor broker's direction and control, not only as to the result accomplished but also as to the details of how the work is performed; (2) The individual receives compensation in the form of wages, salary, or any other form of remuneration in exchange for services rendered.

·       (E)(1) "Labor broker" means any individual or entity who hires an employee and supplies the employee's labor to a nonresidential construction contractor or a subcontractor, regardless of tier, through the use of a contract. (2) "Labor broker" does not include any governmental entity or labor organization as defined in section 3517.01 of the Revised Code.

·        (F) "Nonresidential construction contractor" means any individual or entity that has responsibility for the means, method, and manner of construction, improvement, renovation, or repair on a nonresidential construction project with respect to one or more trades and who offers, identifies, advertises, or otherwise holds out or represents that the individual or entity is permitted or qualified to perform or have responsibility for the means, method, and manner of construction, improvement, renovation, repair, or maintenance with respect to one or more trades on a nonresidential construction project.

·       (G) "Nonresidential construction project" means the construction or renovation of any building, highway, bridge, utility, or related infrastructure, but does not include any of the following: (1) An industrialized unit, manufactured home, or a residential building as defined in section 3781.06 of the Revised Code; (2) A building or structure that is incidental to the use of the land on which the building or structure is located for agricultural purposes as defined in section 3781.06 of the Revised Code; (3) A mobile home as defined in section 4501.01 of the Revised Code.

·        (H) "Subcontractor" means any individual or entity who enters into a contract with a nonresidential construction contractor or another subcontractor, regardless of tier, to perform work on a nonresidential construction project.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.