State ex rel. Ohio-Kentucky-Indiana Reg'l Council of Governments v. Ohio Bureau of Workers' Comp., 20AP-56

CourtUnited States Court of Appeals (Ohio)
Writing for the CourtSADLER, J.
Citation2021 Ohio 2001
PartiesState ex rel. Ohio-Kentucky-Indiana Regional Council of Governments, Relator, v. Ohio Bureau of Workers' Compensation, Respondent.
Docket NumberNo. 20AP-56,20AP-56
Decision Date15 June 2021

2021 Ohio 2001

State ex rel. Ohio-Kentucky-Indiana Regional Council of Governments, Relator,
Ohio Bureau of Workers' Compensation, Respondent.

No. 20AP-56


June 15, 2021



On brief: Taft Stettinius & Hollister LLP, Samuel M. Duran, and Maria C. Castro, for relator.

On brief: Dave Yost, Attorney General, and John R. Smart, for respondent.



{¶ 1} Relator, Ohio-Kentucky-Indiana Regional Council of Governments ("OKI"), brings this original action seeking a writ of mandamus ordering respondent, Ohio Bureau of Workers' Compensation ("BWC"), to change relator's recently assigned manual classification for purposes of determining risk and workers' compensation premium rates and reassign the more favorable manual classifications previously in effect. Relator asserts that the new manual classification does not fit relator's business activities, was arbitrarily and capriciously assigned, and was not adequately explained or supported by reasoning in the relevant orders.

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{¶ 2} This matter was referred to a magistrate pursuant to Civ.R. 53 and Loc.R. 13(M) of the Tenth District Court of Appeals. The magistrate issued the appended decision, including findings of fact and conclusions of law, and recommended this court grant relator's request for a writ of mandamus. The magistrate determined BWC abused its discretion by reclassifying OKI as a "[p]ublic employer[], taxing district[]," under R.C. 4123.01(B)(1)(a) and Ohio Adm.Code 4123-17-019(B), and assigning OKI to the "special public authority" classification under BWC Manual code 9443. The magistrate concluded that relator fit the definition of a "public service corporation" under R.C. 4123.01(B)(1)(b) and, therefore, should have retained National Council on Compensation Insurance ("NCCI") Manual codes 8742 (Salespersons or Collectors-Outside) and 8810 (Clerical Office Employees) for purposes of relator's risk assessment and premium rates. Accordingly, the magistrate recommended that we issue a writ of mandamus ordering BWC to vacate its order reclassifying OKI and restore the NCCI Manual classifications previously in effect.


{¶ 3} Respondent sets forth the following objections:

1. The magistrate erred by finding the OKI is a "public service corporation" and a private employer.

2. The magistrate erred in finding the BWC abused its discretion in finding OKI is a public employer appropriately reclassified to Manual 9443.


{¶ 4} In OKI's first objection, OKI argues that the magistrate erred by finding OKI is a "public service corporation" and, therefore, a private employer under R.C. 4123.01(B)(1)(b). We find this objection largely dispositive of this matter given the fact that an employer must be classified either as a "private employer" under R.C. 4123.01(B)(1)(b) or a "public employer" under R.C. 4123.01(B)(1)(a).

{¶ 5} Pursuant to R.C. 4123.01(H), "[p]rivate employer" means an employer as defined in division (B)(1)(b) of this section. A private employer is defined in R.C. 4123.01(B)(1)(b) as follows:

Every person, firm, professional employer organization, alternate employer organization, and private corporation,

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including any public service corporation, that (i) has in service one or more employees or shared employees regularly in the same business or in or about the same establishment under any contract of hire, express or implied, oral or written, or (ii) is bound by any such contract of hire or by any other written contract, to pay into the insurance fund the premiums provided by this chapter.

(Emphasis added.)

{¶ 6} Here, the dispositive issue in this case is not whether BWC mischaracterized the particular operations performed by employees of OKI in assigning a manual code but whether OKI is a public employer or a private employer. BWC contends that the magistrate erred in concluding that OKI was a "public service corporation." We agree.

{¶ 7} BWC argues that a public service corporation must be a corporation that either provides utility services directly to the public or provides passenger or freight services directly to the public. In support of its position, BWC relies on the definition of the term "public service corporation" in Ballentine's Law Dictionary which defines the term as: "A quasi-public corporation, operating for the purpose of supplying gas or electricity to users, carrying passengers or freight, or otherwise as a public utility." Ballentine's Law Dictionary (3d Ed.2010).1

{¶ 8} We note that Black's Law Dictionary contains a similar definition of "public service corporation" as follows:

A corporation whose operations serve a need of the general public, such as public transportation, communications, gas, water, or electricity. This type of corporation is usu. subject to extensive governmental regulation.

Black's Law Dictionary 393 (9th Ed.2009).

{¶ 9} There is no evidence in the stipulated record that OKI provides utility services to the public. Nor is there evidence that OKI provides any services directly to the public. Rather, OKI provides "services within the OKI Region as applicable law will permit and the Board of Directors or the Executive Committee require in order to foster and develop better coordination, protection and satisfaction of the interests and needs of the public governing

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bodies within OKI Region." (Emphasis added.) (Am. and Restated Articles of Agreement at Article II, Section 2.a.)2

{¶ 10} We note that R.C. 2909.04 defines the offense of "[d]isrupting public services" as follows:

(A) No person, purposely by any means or knowingly by damaging or tampering with any property, shall do any of the following:

(1) Interrupt or impair television, radio, telephone, telegraph, or other mass communications service; police, fire, or other public service communications; radar, loran, radio, or other electronic aids to air or marine navigation or communications; or amateur or citizens band radio communications being used for public service or emergency communications;

(2) Interrupt or impair public transportation, including without limitation school bus transportation, or water supply, gas, power, or other utility service to the public;

(3) Substantially impair the ability of law enforcement officers, firefighters, rescue personnel, emergency medical services personnel, or emergency facility personnel to respond to an emergency or to protect and preserve any person or property from serious physical harm.

{¶ 11} While R.C. 2909.04 does not speak directly to the question whether OKI can be considered a public service corporation for purposes of workers' compensation laws, the statute is instructive in that it lists the types of services that are considered "public services" in Ohio. Though the stipulated record shows that OKI provided services to public governing bodies, there is no indication in the stipulated record and no argument made by OKI that it provides any of the "public services" identified in R.C. 2909.04. Even though the political subdivisions that have contracted with OKI certainly provide such services, OKI does not. Thus, it is not appropriate to classify OKI as a public service corporation under R.C. 4123.01(B)(1)(b).

{¶ 12} In State ex rel. RMS of Ohio, Inc. v. Ohio Bur. of Workers' Comp., 113 Ohio St.3d 154, 2007-Ohio-1252, the employer at issue was a business that provided in-home

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personal-care services to clients who are mentally handicapped or developmentally disabled. After a BWC audit of the employer's payroll records, BWC reclassified the employer which resulted in a higher workers' compensation premium. Prior to the audit, the employer was classified under manual codes covering "Welfare Social Service Organizations Professional Employees" and "Welfare Social Service Organizations Non-Professional Employees." Id. at ¶ 2. On finding that the employer was not a welfare or charitable organization, BWC reclassified the employer and assigned classification codes pertaining to "Nursing-Home Health, Public and Traveling -- all employees." Id. at ¶ 2. When BWC denied further review, the employer filed its mandamus action in this court alleging the reclassification constituted an abuse of discretion by BWC.

{¶ 13} In a hearing before a magistrate, the employer conceded that it did not provide services to individuals in a group-home setting and that it was not a charitable or welfare organization, which is what the prior code classifications covered. Though the employer also acknowledged that its services were rendered at the clients' homes, the employer argued that the actual duties of its employees were the same and the risks were similar. This court found that because the services provided by the employer were not provided to individuals in a group-home setting and the employer was not a charitable or welfare organization, the prior code classifications were inaccurate. Id. at ¶ 20-22. Accordingly, we denied the requested writ. In so holding, this court afforded deference to BWC and found no abuse of discretion. Id.

{¶ 14} Here, OKI claims to be a public service corporation entitled to the rates assigned to private employers even though OKI does not provide a public service and does not provide any services directly to the public. Because OKI does not provide a public service and does not provide any services directly to the public, the magistrate erred in concluding OKI qualified as a public service corporation under R.C. 4123.01(B)(1)(b). See RMS of Ohio.

{¶ 15} Accordingly, BWC's first objection is sustained.

{¶ 16} In BWC's second objection, BWC argues the magistrate erred in concluding BWC abused its discretion in finding OKI was a public employer under manual code 9443. The magistrate found that "Manual 9443 is not an NCCI classification. Manual 9443 (Special Public Authorities) is a 'state special,' or...

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