January 12, 2009

Ohio Legislature Amends Statute to Allow Group Rating to Continue

On November 18, 2008, the Cuyahoga County Court of Common Pleas issued an injunction granting plaintiffs’ request to prohibit the Ohio Bureau of Workers' Compensation from continuing its Group Rating Program beginning with the next rating year on July 1, 2009. The judge's decision did not refer to the perceived inequities in the rating system, that is, the claim that non-group rating employers have underwritten the premiums of group rated employers for a number of years. The decision rested upon the statutory language which creates a Group Rating Program, but states that the plan must be "a retrospective rating plan." The Group Rating Program is clearly not retrospective in nature. In order to remedy the problem created by the decision for between 96,000 and 100,000 employers throughout the state of Ohio, the legislature undertook the task of amending the statute to remove the language on which the Court relied. On January 6, 2009, Governor Strickland signed into law Substitute H.B. 79, which removed the word "retrospective" from the statute. As a result, the Group Rating Program will continue for the rating year beginning July 1, 2009.

The Bureau of Workers' Compensation continues to modify the Group Rating Program in order to address the inequities described by the plaintiffs in the lawsuit, which is still pending before the Cuyahoga County Court of Common Pleas.

This E-Mail Alert was prepared by the Bricker & Eckler Employment and Labor Group. If you have any questions about this topic or any other employment law issue, please contact Betsy A. Swift at 614.227.8850 or Thomas R. Sant at 614.227.2331.