OhioBWC - Basics: (Policy library) - File

 

Policy Name:

Trucking Industry Companies

Policy #:

EP-20-05

Code/Rule Reference

Ohio Revised Code (ORC) 4123.01, 4921.01, 4923.01. Ohio Administrative Code (OAC) 4123-17-14, 4123-17-17, 4123-17-23.

Effective Date:

February 17, 2026

Approved:

Nick Frost, Chief of Employer Services

Origin:

Employer Policy

Supersedes:

N/A

History:

New policy issued February 17, 2026.

Review Date:

February 17, 2031

 

I.       Policy Purpose

 

This policy provides guidance to Employer Services staff in addressing workers’ compensation issues involving trucking industry companies.

II.     Applicability

The policy applies to BWC Employer Services, trucking industry companies, and their authorized representatives.

III.   Definitions

A.      Bona fide: In Latin, the term means “in good faith” or “in sincere intention.” Bona fide refers to something that is authentic, genuine, and made or done without intent to deceive.

B.      Bona fide lease agreement: A written lease where the driver has a substantial investment in the truck by paying a periodic, fixed rental fee at fair market value, with commercially reasonable terms.

C.      Drop lot: A site where equipment and vehicles transporting goods can be temporarily stored or parked.

D.     Home terminal: The place of business of a motor carrier at which a trucker ordinarily goes to load, unload, store, or transfer freight that is a permanent location with central loading docks and/or storage facilities.

E.      Independent contractor: As used in this policy, owner-operators are valid independent contractors.

F.      “Leasing onto” agreement: A written agreement where an owner-operator leases their truck and services to a United States Department of Transportation (USDOT) motor carrier in accordance with 49 CFR §376.11(c), 49 CFR §390 to operate the truck under the motor carrier’s operating authority that identifies the truck by vehicle identification number (VIN) and the name of the owner.

G.     Motor carrier: An employer engaged in the business of transporting property by motor vehicle for compensation. A motor carrier may be one of the following:

1.      A “for hire” motor carrier transporting cargo owned by others for compensation; or

2.      A “private” motor carrier transporting its own cargo, usually as part of a business that produces, uses, sells, or buys cargo that is being hauled.

H.     Motor vehicle: Means any vehicle, machine, tractor, trailer, or semitrailer propelled or drawn by mechanical power and used upon the highways in the transportation of property. See ORC 4921.01(F). As used in this policy, the term “truck” has the same meaning as motor vehicle.

I.        Ohio employee: An employee who is covered by Ohio workers’ compensation due to the employer’s responsibility to report for that employee pursuant to OAC 4123-17-23(A), (C), or (D).

J.      Owner-operator: A trucker that either owns a truck, or leases the truck under a bona fide lease agreement, and meets all the criteria set forth in policy section IV.A.2.

K.      State of residence: The state used by the trucker for filing federal income taxes.

L.      Temporary replacement lease: A short-term agreement where a trucking company leases a replacement vehicle to temporarily substitute for a truck that is out of service.

M.    Trucker: The person operating a motor vehicle.

N.     USDOT operating authority: A federally mandated license required for a motor carrier to provide for-hire interstate freight services issued by the Federal Motor Carrier Safety Administration, USDOT.

IV.   Policy

A.      Determining whether a trucker is employed as a company driver or is an owner-operator.

1.      As set forth in ORC 4123.01(A)(1)(d), a trucker who operates a vehicle in the performance of services for or on behalf of a motor carrier transporting property meets the definition of employee unless all of the factors in this law apply to the trucker.

2.      As set forth in ORC 4123.01(A)(1)(d)(i-vii), an owner-operator is a trucker who meets all of the following factors:

a.      The trucker owns the vehicle used in performing the services for or on behalf of the motor carrier or the trucker leases the vehicle under a bona fide lease agreement that is not a temporary replacement lease;

b.      The trucker is responsible for supplying the necessary personal services to operate the vehicle used to provide the service;

c.       The compensation paid to the trucker is based on factors related to work performed, including on a mileage-based rate or a percentage of any schedule of rates, and not solely based on the hours or time worked;

d.      The trucker substantially controls the means and manner of performing the services, in conformance with regulatory requirements and specifications of the shipper;

e.      The trucker enters a written contract with the motor carrier that describes the relationship between the trucker and the motor carrier to be that of an independent contractor and not that of an employee;

f.        The trucker is responsible for substantially all of the principal operating costs of the vehicle and equipment used to provide the services, including maintenance, fuel, repairs, supplies, vehicle insurance, and personal expenses, except the trucker may be paid by the motor carrier the motor carrier's fuel surcharge and incidental costs, including tolls, permits, and lumper fees; and

g.      The trucker is responsible for any economic loss or economic gain from the arrangement with the motor carrier.

3.      BWC examines the ownership, or legal control of the truck, when reviewing the arrangement between a trucker and a motor carrier. If the trucker does not own the truck, BWC must review certain documents to determine the validity of the arrangement.

a.      "Leasing onto" agreement. A truck cannot haul loads on a public highway without operating under a USDOT number. A valid owner-operator will "lease" their tractor onto a motor carrier that has a USDOT operating authority. The leasing of the tractor to the motor carrier enables the owner-operator to operate the tractor using the motor carrier's USDOT operating authority and is commonly referred to in the industry as "leasing onto" the motor carrier.

b.      Proof of ownership of the truck identified in the “leasing onto” agreement is usually in the vehicle’s title or a title receipt. Ownership or leasing documents are critical for demonstrating a trucker’s authority to use the truck commercially. A motor carrier collects these documents and keeps them in their records when a truck is “leased onto” their USDOT operating authority.

c.       Agreements. These agreements may have titles like Independent Contractor Agreement, Driver Agreement, or Lease Agreement.

d.      International Registration Plan (IRP). The IRP is an agreement among 48 states, 10 Canadian provinces, and the District of Columbia where a motor carrier can register commercial vehicle fleets for travel in all IRP jurisdictions by filing paperwork with the home jurisdiction. In Ohio, the Ohio Apportioned Registration Cab Card (BMV 0025) is issued by the Bureau of Motor Vehicles. The cab card includes the name and address of the registrant/operator, vehicle description, VIN, owner/lessor name and address, and the USDOT motor carrier responsible for safety.

4.      If the truck is leased, BWC must determine if the lease is a bona fide lease agreement. The commercial truck lease agreement must be provided to BWC upon request.

a.      As set forth in ORC 4123.01(A)(1)(d)(i), a bona fide lease agreement does not include an agreement between the trucker and the motor carrier for which, or on whose behalf, the trucker provides services.

b.      The term of the lease should be substantial, in the proximity of one year or longer.

c.       The lease must constitute a business expense for the owner-operator.

d.      The lease does not provide for termination of the lease upon termination of the trucker’s association with the trucking operation, or related entity, and is not subject to cancellation at any time.

e.      The business records show a deduction for a lease payment in weekly settlement amounts that is real, consistent, and equivalent to the actual rent payment.

f.        The trucking operation treats all drivers who lease vehicles the same as drivers who own vehicles.

g.      A driver has the right to use the leased vehicle for any lawful purposes and is not restricted to using the vehicle to drive for a particular company.

h.      Lessor (Truck Owner) authorizes Lessee (Truck Driver) to register the truck as provided by OAC 4501:1:8-08. See Ohio Bureau of Motor Vehicles (BMV) form Leased Vehicle Owner’s Authorization To Lessee (BMV 4845).

i.        A lease agreement that merely documents compensation and expectations of the trucker is not a bona fide lease agreement for workers’ compensation purposes.

5.      If all the documents required to determine the validity of an arrangement are not provided for BWC’s review, the remuneration for the trucker will be deemed reportable.

B.      Ohio jurisdiction. When determining Ohio jurisdiction, the Interstate Jurisdiction policy applies. The guidelines for the trucking industry BWC uses include, but are not limited to, the following.

1.      BWC will review the trucking company’s operations in Ohio.

a.      If the home terminal for a trucker is in Ohio, all payroll for the trucker who reports to that terminal is reportable to Ohio, regardless of the state of residence of the trucker. BWC would respond to claims arising inside Ohio and outside Ohio through extraterritorial jurisdiction. See Scenario 1.

b.      If the home terminal for a trucker is outside of Ohio, for Ohio residents all payroll for that trucker is reportable to the insurer for the trucking company in the other state. However, the payroll for any work performed in Ohio must be reported to BWC. BWC would only respond to claims arising in Ohio. See Scenario 2.

c.        An Ohio resident parks a truck at their residence. The trucking company has no operations in Ohio. The payroll for work performed in Ohio must be reported to BWC. BWC would only respond to claims arising in Ohio. See Scenario 3.

d.      If the trucking company has a drop lot in Ohio at which a trucker goes to pick up a truck, for residents of Ohio the payroll for work performed in Ohio must be reported to BWC. BWC would only respond to claims arising in Ohio. Non-Ohio residents that only pick up a truck in Ohio are not Ohio based employees entitled to extraterritorial coverage for claims arising outside Ohio. See Scenario 4.

e.      A trucking company has only out-of-state residents driving into Ohio temporarily. BWC recognizes the extraterritorial workers' compensation insurance coverage of an out-of-state employer for its regular employees who are residents of a state other than Ohio while performing work in Ohio for a temporary period not to exceed ninety (90) consecutive calendar days. See the Multistate Jurisdiction Payroll and Coverage policy for additional information. See Scenario 5.

2.      Allocating payroll. Ohio law allows employers to obtain coverage in other states in addition to their Ohio coverage for Ohio employees who work outside Ohio on a temporary basis. BWC may, depending on the trucking company’s operations, use the following methods to allocate payroll.

a.      The employer has filed a Notice of Election to Obtain Coverage from Other States for Employees Working Outside of Ohio (U-131) pursuant to ORC 4123.292. The employer must file a copy of the insurance policy with the U-131. In this situation, BWC will use the following guidelines.

i.        Payroll for work the truckers performed in Ohio is reportable to Ohio.

ii.      The employer must maintain verifiable documentation of the amount of payroll paid to employees for work performed outside of Ohio and covered by the other states coverage policy and provide the documentation to BWC upon request.

iii.    Any payroll not reportable to the workers’ compensation insurer in another state is reportable to Ohio.

b.      The trucking company uses the International Fuel Tax Association (IFTA) fuel tax reporting to support the allocation of payroll for a trucker using miles driven in each jurisdiction (state). The employer must have coverage in other states in addition to Ohio coverage.

i.        The IFTA is an agreement between the lower 48 states of the United States and the Canadian provinces, to simplify the reporting of fuel use and jurisdictional miles by motor carriers that operate in more than one jurisdiction.

ii.      BWC may use the IFTA to verify the allocation of payroll between Ohio and the other states the trucker drives.

iii.    Trucking companies may also use an Electronic Logging Device (ELD) and GPS systems to track the truck’s location that can automatically log the mileage traveled in each state.

C.      Scenarios.

1.      Trucking company has a terminal or supervising office in Ohio.

a.      A trucker works for an Ohio trucking operation and reports to a terminal in Ohio to pick up a truck. This is an Ohio based trucker, and BWC would respond to claims arising inside Ohio and outside of Ohio through extraterritorial jurisdiction with 100% of payroll reportable to BWC. This scenario applies to Ohio residents and non-Ohio residents.

b.      This scenario would also apply to a trucking company headquartered outside Ohio with a terminal in Ohio.

2.      Ohio resident whose home terminal is outside Ohio.

a.      All payroll for that trucker is reportable to the insurer for the trucking company in the other state. If the trucker does no driving or work in Ohio, then no payroll is reportable to BWC.

b.      An Ohio resident hurt in Ohio is entitled to pursue a claim in Ohio. The payroll for any work performed in Ohio must be reported to BWC. BWC would only respond to claims arising in Ohio. However, the trucker and the trucking company may agree to execute an Employer/Employee Agreement to Select a State Other Than Ohio as the State of Exclusive Remedy for Workers’ Compensation Claims (C-112) form to clarify that the trucker will not pursue a claim in Ohio. Payroll is not reportable to BWC with an executed C-112 on file with BWC. Employer/Employee Agreement to Select Ohio as the State of Exclusive Remedy for Workers’ Compensation Claims (C-110) forms have very limited valid use. This scenario would also be a valid use of a C-110 form to clarify that claims will be pursued in Ohio and payroll reported to Ohio.

3.      An Ohio resident parks a truck at their residence.

a.      An Ohio resident hurt in Ohio is entitled to pursue a claim in Ohio. The payroll for any work performed in Ohio must be reported to BWC. BWC would only respond to claims arising in Ohio.

b.      However, the trucker and the trucking company may agree to execute a C-112 form to clarify that the trucker is not entitled to pursue a claim in Ohio. Payroll is not reportable to BWC with an executed C-112 on file with BWC. C-110 forms have very limited valid use. This scenario would also be a valid use of a C-110 form to clarify that claims will be pursued in Ohio with payroll reported to Ohio for that trucker.

4.      Trucking company has only a drop lot in Ohio.

a.      Some trucking companies do not have a company terminal, maintenance garage, or location where trucks are serviced or stored, with owners living outside Ohio. For an employment relationship to be Ohio-based, there must be a supervising office the trucking company operates in Ohio, with work/driving inside and outside of Ohio.

b.      A PO Box or virtual office located in Ohio is not an actual supervising office. Ohio’s extraterritorial coverage for injuries arising outside Ohio does not apply to this scenario.

5.      90-Day Rule.

a.      An Indiana trucking company has a terminal in Indiana that is the home terminal for some non-Ohio residents. The company drivers haul freight to destinations inside Ohio and drive routes across Ohio to destinations on the East Coast returning to the home terminal.

b.      This type of work activity in Ohio is temporary in nature, and payroll is not reportable to BWC.