Ohio Cannabis Employer’s Guide to Employee Terminations

A Practical Guide to Employee Terminations for Ohio Cannabis Business Owners

Terminating an employee is one of the most stressful things a new business owner faces. Even when the decision is clear, the process can feel like a minefield if you’ve never done it before. The good news is that Ohio’s at-will employment framework gives employers flexibility, and if you have been documenting consistently along the way, a termination can be handled cleanly and professionally.

This guide walks you through the process in order, with a checklist for each stage. It also covers a few important legal concepts, specifically around age discrimination and severance agreements, that new operators often don’t know about until they are already in a termination situation.

As always, this is practical guidance, not legal advice. For terminations involving potential discrimination claims, protected activity, or complex severance arrangements, consult an employment attorney before you act.

Before the Meeting: Prepare

Before you sit down with the employee, make sure you have done the following.

• Confirm the decision is final and documented. Review the employee’s personnel file. Confirm that the reason for termination is clear, consistent with your written policies, and supported by documentation. If there is a history of conduct or performance issues, those records should exist before you walk into the meeting.
• Verify the reason is lawful. Ohio is an at-will state, meaning you can generally terminate an employee for any reason that isn’t illegal. Illegal reasons include termination based on race, sex, age, religion, national origin, disability, or other protected characteristics under the Ohio Civil Rights Act and federal law. Also off-limits: termination in retaliation for filing a workers’ compensation claim, reporting a safety violation, filing an unemployment claim, or taking protected leave.
• Check if there is any protected activity in the picture. Has the employee recently complained about harassment, discrimination, or a labor law violation? Filed an ODJFS claim? Requested leave? Used protected leave? These are not reasons to delay a legitimate termination, but they are reasons to make sure your documentation clearly supports the termination on independent grounds before you proceed.
• Calculate the final paycheck. In Ohio, the final paycheck is due on the next regular payday or within 15 days of the last day of work, whichever comes first. This applies to both voluntary and involuntary separations. Calculate what is owed, including all earned wages, any overtime, and any accrued PTO or vacation that your written policy requires you to pay out. Don’t include any deductions for unreturned equipment or alleged damages without the employee’s prior written authorization.
• Prepare your termination paperwork. Have your termination letter and any separation documents ready before the meeting. The termination letter should include the employee’s name, the effective date of termination, the reason for termination stated clearly, and information about final pay, benefit continuation (COBRA), and the return of company property. If you are offering severance, see the ADEA/OWBPA section below before you finalize that document.
• Identify who will be in the meeting. Always have a second person present, typically a manager or co-owner, who can serve as a witness. Do not conduct a termination meeting alone.
• Prepare for the collection of company property. Know what the employee has: keys, access codes, a company device, a uniform, and, most importantly, their state-issued dispensary employee ID card. You will need to collect and destroy that card within 10 calendar days of separation.

The Termination Meeting

Keep the meeting brief, direct, and professional. This is not the time for a long performance review.

• State the decision clearly at the beginning. Don’t build up to it. The employee should understand within the first 60 seconds that the meeting is a termination, not a disciplinary conversation. A prolonged delivery is unkind and creates confusion.
• State the reason simply. You do not need to deliver a detailed narrative. One or two sentences explaining the basis for the decision is sufficient. If the employee has received prior warnings, you can reference those briefly.
• Do not debate, negotiate, or apologize for the decision. If the employee pushes back, you can acknowledge that they see it differently without reopening the conversation. The decision has been made.
• Cover the logistics. Let the employee know when their final paycheck will be issued, what happens with their health insurance, and what the process is for returning company property.
• Collect the employee ID card. Collect the state-issued dispensary employee license ID card at the termination meeting if possible. The Ohio Administrative Code requires the dispensary to collect and destroy this card within 10 calendar days of separation.
• Have the employee sign the termination paperwork. This does not mean they agree with the decision. The signature acknowledges receipt of the documents. If the employee refuses to sign, note that on the document and have your witness confirm it in writing.
• Revoke system access. Before or immediately after the meeting, revoke the employee’s access to your POS system, METRC, security codes, and any other business systems. This is an important operational step, and it should happen on the same day.

After the Meeting: Ohio-Specific Obligations

The meeting is done. These are the steps you need to complete within specific deadlines.

• Issue the final paycheck by the deadline. Ohio requires the final paycheck to be paid on the next regular payday or within 15 days of the employee’s last day, whichever is sooner. Don’t wait longer than necessary.
• Collect and destroy the dispensary employee ID card within 10 calendar days. This is required under Ohio Administrative Code Rule 3796:6-2-09. The destruction must happen within 10 days of separation.
• Submit the notice of separation to the state board within 10 calendar days. Also required under Rule 3796:6-2-09. This is a regulatory obligation specific to Ohio cannabis dispensaries. Build this step into your offboarding process so it doesn’t get missed.
• Provide COBRA or Ohio mini-COBRA notice. If you offer group health insurance and have 20 or more employees, federal COBRA requires you to notify the employee of their right to continue health coverage. If you have fewer than 20 employees, Ohio’s mini-COBRA law still applies for involuntary terminations. The notice should include the cost of continued coverage and how to elect it. Provide this notice at the time of termination or with the final paycheck.
• Secure and retain the personnel file. Keep the terminated employee’s file, including all documentation that supported the termination decision. Employment records should generally be retained for a minimum of three years, though some records have longer retention requirements. When in doubt, keep them longer.
• If the employee files for unemployment, file the unemployment records. When the employee files for unemployment, you will receive a Request for Separation Information from ODJFS. You have 10 business days to respond. See our separate guide on responding to unemployment claims for the full process.

If You Are Offering Severance: What You Must Know About ADEA and OWBPA

Ohio law does not require you to offer severance pay. If you choose to offer it in exchange for a release of legal claims, however, you need to understand two federal laws that apply whenever the employee is 40 years of age or older.

The Age Discrimination in Employment Act (ADEA) is a federal law that prohibits employment discrimination against workers who are 40 or older. It applies to employers with 20 or more employees. Under the ADEA, an employer can’t treat an employee less favorably because of their age in any employment decision, including terminations.

The Older Workers Benefit Protection Act (OWBPA) is an amendment to the ADEA that sets specific requirements for severance agreements that include a waiver of age discrimination claims. If you ask an employee who is 40 or older to sign a severance agreement that includes a release of claims, the OWBPA requirements must be met, or the release is legally invalid, even if the employee signed it.

OWBPA Requirements for a Valid Release (Employee Age 40+)

If you are offering severance with a release of claims to an employee who is 40 or older, your agreement must:

• Be written in plain language the employee can clearly understand.
• Specifically name the ADEA by its full title in the release language.
• Advise the employee in writing to consult an attorney before signing.
• Provide consideration in addition to what the employee is already owed. Paying out wages already earned does not count. The severance itself is typically the consideration.
• Give the employee at least 21 days to consider the agreement before signing. The employee may choose to sign sooner, but you cannot pressure them to do so.
• Include a 7-day revocation period after signing. The agreement does not become effective until those 7 days have passed.
• Not include a waiver of claims that arise after the date of signing.

Additional Requirements for Group Layoffs (Two or More Employees Age 40+)

If you are offering severance agreements to two or more employees who are 40 or older as part of the same decision-making process, the review period extends to 45 days, and you must also provide a written OWBPA disclosure that includes:

• The decisional unit: the group of employees who were considered for the layoff.
• The eligibility factors and selection criteria were used to determine who was selected.
• The job titles and ages of all employees who were considered, including those not selected.
• The notification and termination dates.

Getting any of these requirements wrong invalidates the release. An employee who signed a defective release may still be able to bring an age discrimination claim against you. If you are offering a severance agreement to any employee age 40 or older, have an employment attorney review the document before you present it.

A Note on Documentation

The value of a well-documented termination becomes most visible when something goes wrong afterward. An unemployment claim where the employee disputes the reason for separation, an age discrimination charge, a wrongful termination lawsuit, all of these become significantly more manageable when you have a clear paper trail with written policies in your employee handbook, signed acknowledgments, documented warnings, and a termination record that tells a coherent, factual story.

If your documentation habits aren’t yet where they need to be, that is the most important thing to fix before your next hire, not after your next termination.

KushHR’s Performance Management and Termination Toolkit is built to produce a clean, complete progressive discipline and separation record for your files. Our Toolkit includes templates that give you every step of the documentation trail that makes a termination defensible before you ever reach the meeting. If you have questions about where to start, we are here to help.