by David J. Schmitt
Pursuant to a recent court ruling, employers who paid Ohio Worker’s Compensation premiums between 2001 – 2008, and which were not group-rated, may be entitled to reimbursement for a portion of their premiums.
In the case of San Allen, Inc., et al, v. Stephen Buehrer, Administrator of the Ohio BWC, Cuyahoga County Court of Common Pleas, Case No. CV-07-644950, the plaintiffs consist of Ohio employers who paid workers compensation premiums during the indicated period, which did not receive group-rated premium discounts. The lawsuit contended that the BWC’s premium discounts for group-rated employers were too steep and that the BWC overcharged other employers to make up the difference.
The case was granted class-action status meaning that any employer that paid premiums to the BWC on a nongroup-rated basis during any one or more of the policy years in question is automatically part of the class unless it affirmatively opted-out.
The plaintiffs initially requested close to $1.3 billion in reimbursement for class members. In a decision issued December 28, 2012, Judge Richard McMonagle determined that the BWC did indeed overcharge the plaintiff employers and that the class is entitled to reimbursement. However, the judge also determined that the plaintiffs are not entitled to interest on these amounts and therefore ordered the plaintiffs’ counsel to recalculate the damages and submit a new figure by January 28, 2013. While this will reduce the ultimate award, the figure is still expected to be close to $1 billion in damages.
The formula for how individual employers will be reimbursed has not yet been released or approved by the court.
The Ohio BWC has stated that it is disappointed in the decision and intends to appeal, so even if this decision is ultimately upheld, it will likely be many months before any distribution would be made to class members.
Regardless of whether it is a class member, all Ohio employers should continue to follow this case. Class members will naturally be interested in how much reimbursement they may be entitled to. Non-class members may still be impacted because if the BWC’s appeal fails and it has to pay this judgment, it may have to raise premiums in order to recoup some or all of its losses.
As developments continue to arise in this case, Cors & Bassett will provide further information and guidance to assist you. Please contact David Schmitt at firstname.lastname@example.org or by phone at 513-852-2587 if you would like to discuss this matter further.