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Published: Thursday, 7/31/2014


Good, if late, settlement

An agreement between the state and employers will boost Ohio’s business climate and protect injured workers

Better late than never, the Ohio Bureau of Workers’ Compensation (BWC) has settled a seven-year-old lawsuit that accused the agency of overcharging more than 200,000 businesses for premiums to insure against employees’ workplace injuries. The agreement removes an irritant between the administration of Gov. John Kasich and Ohio’s largely supportive business community, although the practices cited in the lawsuit predated Mr. Kasich’s tenure.

In 2013, Judge Richard McMonagle of Cuyahoga County Common Pleas Court awarded the plaintiffs in the so-called San Allen case more than $859 million. Last May, a state appeals court upheld most of the trial judge’s ruling, but ordered him to reduce the award — which he did, to about $651 million.

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Sensibly, the Kasich administration did not appeal the ruling to the Ohio Supreme Court, but instead negotiated a settlement. Under the agreement announced last week, which the judge also must agree to before it can take effect, the BWC will pay affected businesses as much as $420 million.

The overcharges occurred between 2001 and 2008, during the gubernatorial administrations of Republican Bob Taft and Democrat Ted Strickland. The plaintiffs argued — and courts agreed — that the BWC had discriminated illegally against some, mostly smaller, employers in setting premium rates to benefit other employers who got discounts.

Steve Buehrer, the BWC administrator, said the bureau has changed its policies for calculating premiums and discounts, and has improved its billing practices. He noted that the bureau paid $1 billion in rebates to its customers last year.

Prompt repayment of the businesses affected by the San Allen settlement will affirm the bureau’s good faith. Money from the agreement will help these businesses to invest in expansion, create jobs, and ensure that their employees remain adequately protected if they are injured.

A third-party administrator will process claims submitted under the settlement. Any leftover money will go to injured workers. It’s a good agreement.

Still, the class-action lawsuit should have been resolved before now, despite its complexity. Judge McMonagle deserves credit for his efficient administration of the case; none of the delays in its resolution can be attributed to him.

The settlement between the BWC and the plaintiff companies exchanges adversarial acrimony for certainty and voluntary compromise. Would that the rest of state government — and Washington — could discover such virtues.

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