To amend sections 4111.06, 4111.14, 5122.28, 5123.022, 5123.023, 5123.87, 5747.98, and 5751.98 and to enact sections 3304.45, 4111.061, 5747.87, and 5751.56 of the Revised Code to phase out the subminimum wage for individuals with physical or mental disabilities, to authorize a tax credit for purchases made from nonprofit corporations that hire such individuals, and to name this act the Ohio Employment First and Greater Opportunities for Persons with Disabilities Act.
SB 142 would phase out Ohio’s subminimum wage system for workers with physical or mental disabilities and replace it with a transition toward competitive, integrated employment. The bill would stop the issuance and renewal of state licenses that currently allow payment below the minimum wage, prohibit most employers from paying subminimum wages after a short transition period, and fully eliminate subminimum wages five years after the effective date. Employers holding state licenses or federal 14(c) certificates would be required to submit transition plans to the Department of Developmental Disabilities, and the department would be tasked with assisting employers, tracking data, identifying benchmarks, and reporting annually on progress.
The bill also creates a new tax incentive for purchases from certified nonprofit “qualified vendors” that employ at least 20% workers with disabilities in integrated settings and provide specified health coverage support. Purchasers from those vendors could claim a nonrefundable income tax or commercial activity tax credit equal to 15% of the purchase price, subject to annual statewide and per-vendor caps. In addition, the bill updates related statutes governing employment services for people with developmental disabilities, reinforces the state’s Employment First policy, and directs agencies to coordinate efforts to support community employment and monitor outcomes.
Beyond wage policy, SB 142 makes conforming changes to Ohio law affecting developmental disability services, hospital and institution labor rules, and tax credit administration. It amends sections governing labor by patients or residents in mental health and developmental disability institutions so that voluntary work is compensated by reference to prevailing wages or the wage rules in section 4111.06. It also adds the new tax credit to the individual income tax and commercial activity tax credit ordering statutes, and requires annual reporting on the credit’s use.
The general sentiment reflected by the bill’s structure is strongly supportive of disability employment rights and workforce integration. Although no committee transcript or vote record is provided, the bill’s findings, policy declarations, and detailed transition framework indicate a clear policy preference for ending segregated, subminimum-wage work and expanding competitive employment opportunities for people with disabilities. The inclusion of a tax credit and agency support provisions suggests an effort to pair labor reform with incentives and implementation assistance.
The main points of contention likely center on the pace and feasibility of the phaseout, the impact on providers and employers that currently rely on subminimum wage arrangements, and whether the transition supports are sufficient. The bill preserves a limited five-year transition for existing license holders, which suggests concern about disruption, while also imposing reporting, planning, and coordination obligations on state agencies. Another likely issue is the fiscal cost of the new tax credit and whether it effectively promotes integrated employment without creating unintended administrative burdens.
SB 142 would substantially revise Ohio wage and disability-employment law by ending the state’s authorization for subminimum wages for workers with disabilities, after a five-year transition period. It would amend section 4111.06 to stop new and renewed licenses for subminimum wage employment, create section 4111.061 to require transition plans and agency oversight, and conform related provisions in sections 4111.14, 5122.28, and 5123.87. The bill also adds new tax credit provisions in sections 3304.45, 5747.87, and 5751.56, affecting both the individual income tax and commercial activity tax.
The bill’s overall tone is affirmative and reform-oriented, with a strong emphasis on civil rights, competitive employment, and state coordination for people with disabilities. Its findings and policy declarations frame subminimum wage work as something to be phased out in favor of integrated employment, and the bill pairs that goal with transition assistance and tax incentives. No recorded votes or committee testimony were provided, so there is no direct evidence of opposition or support from legislators in the supplied materials.
Likely areas of contention include the elimination of subminimum wages, the five-year transition timeline, and the burden placed on nonprofit providers and employers to shift business models and employment practices. Disability advocates may support the move toward competitive integrated employment, while some providers, employers, or families may worry about job loss, reduced service capacity, or whether enough funding and workforce supports exist to make the transition workable. The new tax credit may also draw scrutiny over eligibility rules, administrative complexity, and the annual cap on credits.