• Ohio General Assembly Passes Substantive Workers' Compensation Benefits Reform
  • March 20, 2006
  • Law Firm: Squire, Sanders & Dempsey L.L.P. - Cleveland Office
  • On March 8, 2006 the Ohio General Assembly passed Amended Substitute Senate Bill Number 7 (SB7), which is expected to be signed into law by Governor Bob Taft. Although SB7 increases the state minimum wage to equal the federal minimum wage of US$5.15 an hour, the aspect of the bill expected to have the greatest impact is the change to existing workers' compensation law:

    Changes to Definition of Injury

    • SB7 clarifies that psychiatric conditions arising from injuries or occupational diseases are compensable only when the injury or occupational disease has been sustained by the claimant, and not by a third party, overruling the decision of the Ohio Supreme Court in Bailey v. Republic Engineered Steels, Inc., 91 Ohio St. 3d 38 (2001).
    • SB7 limits the definition of injury to exclude the aggravation of a pre-existing condition unless that condition is substantially aggravated by the injury, which must be documented by objective diagnostic findings, clinical findings or test results; in contrast to current law, subjective complaints alone are not sufficient to meet this burden. Also, a pre-existing condition substantially aggravated by an industrial injury is compensable only until the condition has returned to its pre-injury level.
    • SB7 expands the definition of injury to include psychiatric conditions arising from sexual conduct in which the claimant was forced by threat of physical harm to participate.

    Changes to Benefit Calculations and Payments

    • Under current law, a claimant may be entitled to a statutory award of permanent total disability compensation due to loss of the use of both hands or both arms, or both feet or both legs, or both eyes, or of any two thereof. SB7 specifies that loss of the use of one limb does not constitute loss of the use of two body parts, overruling the Ohio Supreme Court's decision in State ex rel. Thomas v. Indus. Comm. Of Ohio, 97 Ohio St. 3d 37 (2002).
    • A claimant may not receive permanent total disability compensation when the employee's inability to engage in sustained remunerative employment is due to any of the following reasons, individually or in combination:
      • Impairments that are not the result of the allowed condition;
      • The employee's age or aging;
      • Retirement or other voluntary abandonment of employment for reasons unrelated to the allowed condition; or
      • Failure to engage in educational or rehabilitative efforts to enhance employability.
    • If an employee is awarded permanent total disability compensation due to traumatic brain injury, the employee is not precluded from working in a sheltered workshop so long as the employee does not earn more than US$2,000 in any calendar quarter.
    • SB7 limits the weeks that a claimant may receive working and nonworking wage-loss compensation to a combined total of 226 weeks.
    • SB7 reduces the waiting period to file for permanent partial disability compensation from 40 weeks to 26 weeks following the last payment of compensation in a lost-time claim or the date of injury in a medical claim.

    Procedural Changes

    • Currently, either the claimant or the employer may file a notice of appeal of compensability issues with the courts of common pleas. SB7 provides that the claimant may not dismiss the complaint without the employer's consent if the employer filed the notice of appeal, overruling the Ohio Supreme Court's decision in Kaiser v. Ameritemps, Inc., 84 Ohio St. 3d 411 (1999).
    • An inactive workers' compensation claim may remain open for five years, a reduction from six years for medical claims and 10 years for lost-time claims.
    • SB7 permits a claimant to file an application for approval of a final settlement agreement without an employer's signature when (1) the employer is no longer doing business in Ohio, (2) the claim is no longer in the employer's experience or (3) the employer is noncompliant with premium payments.
    • If an employee dies during the 30-day period following the approval of a final settlement agreement, the settlement may be voided by any party for good cause shown.

    The new statutes should prompt employers to review their workers' compensation policies to ensure compliance with these important changes. For assistance in reviewing or developing your company's practices or policies, contact the Squire Sanders lawyer with whom you are acquainted or one listed in this update.