Policy
Name:
|
.99 EM
Construction Cap
|
Policy #:
|
EP-14-01
|
Code/Rule
Reference
|
Ohio
Administrative Code (OAC) 4123-17-05
Appendix A, HB
15 Section 220
|
Effective
Date:
|
July 1,
2018
|
Approved:
|
Ronald L.
Suttles, Interim Chief Employer Services
|
Origin:
|
Employer
Policy
|
Supersedes:
|
All
policies, directives and memos regarding .99 EM Construction Cap that predate
the effective date of this policy.
|
History:
|
Policy
Original Effective July 1, 2009. Policy Revised: July 1, 2012; July 1, 2016;
October 11, 2018.
|
Review
Date:
|
July 1,
2023
|
I. Policy Purpose
The
Bureau of Workers’ Compensation (BWC) offers eligible construction industry
employers a temporary cap on their experience modification (EM) equal to .99.
BWC will notify qualified construction industry employers of their eligibility
to participate in the program with no application required. BWC will administer
the .99 EM Construction Cap in accordance with all applicable laws and rules.
II. Applicability
This
policy applies to BWC Actuarial, Employer Programs, Employer Services, the
Division of Safety and Hygiene and to private employers (PA employers), in the
construction industry as identified in OAC 4123-17-05 Appendix A.
III. Definitions
A.
Industry Group: National Council on Compensation
Insurance (NCCI) Codes are grouped together into ten (10) Industry Groups ORC
4123-17-05, Appendix A.
B.
Construction
Industry Employer: The employer's
predominant premium is in Industry Group 4, Construction. Construction industry
includes any activity performed in connection with the erection, alteration,
repair, replacement, renovation, installation, or demolition of any building,
structure, highway, or bridge.
C.
Experience
Modifier (EM): The value
that compares an employer’s claim experience to the claim experience that would
be expected of an employer of similar size in the same pursuit of business.
D.
SH-26: The SH-26 form is
intended to help employers evaluate their safety and claims management systems
and identify opportunities for improvement. The form contains eleven (11)
safety and health categories considered critical to an effective safety and
health process. The person(s) within the employer’s organization most familiar
with the current safety and claims management process should complete the form.
E.
True-up: Annual reconciliation of estimated
payroll and actual payroll. All employers must file annual payroll after the
conclusion of the policy year. BWC will calculate any premium obligation or
credit for the completed policy year.
IV. Policy
A.
Eligibility
Criteria:
1.
Initial Eligibility
– All of the following must be met:
a.
Be a Private
Employer (PA);
b.
One of the following
two situations apply:
i.
Employer, for the
policy year beginning July 1, 2007 and for all policy years thereafter, is a
Construction Industry Employer; or
ii.
Employer submits a
written request for participation in the program, and the employer qualifies as
a Construction Industry Employer for the most recently completed policy year;
c.
Be current with
respect to all payments due BWC as defined in OAC 4123-17-14;
d.
Not have cumulative
lapses in workers' compensation coverage in excess of forty (40) days within
the prior twelve (12) months;
e.
Have a published EM
equal to or less than 1.0 in the preceding policy year; and
f.
Have an EM initially
calculated for the current policy year that is greater than 1.0 and not more
than 1.5.
2.
Renewal Eligibility
– All of the following must be met:
a.
The employer was
enrolled in the .99 EM Construction Cap program the previous policy year;
b.
The employer did not
opt out of, and BWC did not remove the employer from, the .99 EM Construction
Cap program during the previous policy year;
c.
The employer
completed a SH-26 by the last business day of July of the preceding policy year
of participation;
d.
The employer has an
EM initially calculated for the current policy year greater than 1.0 and not
more than 1.5;
e.
The employer must
have reported actual payroll for the preceding policy year and paid any premium
due upon reconciliation of estimated premium with actual premium no later than
the due date, per OAC 4123-17-14,
plus any applicable grace period; and
f.
The employer
qualifies as a Construction Industry Employer for the most recently completed
policy year.
B.
The following
employers are not eligible to participate:
1.
Employers that
voluntarily opt out of the .99 EM Construction Cap program, or BWC removes from
the .99 EM Construction Cap program. An employer that voluntarily opts out, or
BWC removes them from the .99 EM Construction Cap program during the previous
policy year, is not eligible to participate for the following year; such an
employer can become eligible in a subsequent policy year if the employer meets
Initial Eligibility in Section IV.A.1. above.
2.
State agencies.
3.
Self-insuring
employers.
4.
Public Employers –
Taxing Districts (PEC employers).
C.
Application Process:
There is no formal application to participate in this program. BWC will notify
qualified Construction Industry Employers under HB 15
of their eligibility to participate. However, employers seeking to participate
in the program because the employer has either previously opted out of the
program, or is seeking participation and did not qualify as a Construction Industry
Employer for the policy year beginning on July 1, 2007, must notify BWC in
writing of the employer’s intent and desire to participate in the program.
D.
All eligible
construction industry employers meeting the conditions set forth in this policy
are considered active participants unless an employer opts out of, or BWC
removes an employer from, the program as described in IV.G. of this policy.
E.
Operation of
Program:
1.
The employer’s
actual premium rates will be calculated based on its earned EM.
2.
The employer must
complete a SH-26 by the last business day of July of the policy year of
participation. An individual SH-26 is valid for twelve (12) months and may be
used by BWC when evaluating all program applications that require an SH-26.
F.
Compatibility with
other Programs: Employers participating in the .99 EM Construction Cap program
may participate in all other BWC Employer Programs as long as they meet the
eligibility and application requirements of those programs.
G.
Opt Out / Exit.
1.
An employer must
choose to opt out of the program in writing by completing BWC Form U-108, Opt Out
of the .99 EM Construction Cap.
2.
If an employer has
any of the following occur, an employer’s actual EM is published, the employer
is no longer participating in the .99 EM Construction Cap Program for the
current policy year, and the employer is ineligible to re-enter the .99 EM
Construction Cap program for the following policy year:
a.
Employer opts out of
.99 EM Construction Cap program;
b.
BWC removes an
employer from the .99 EM Construction Cap program;
c.
Employer fails to
complete the SH-26 by the deadline; or
d.
Employer fails to
complete the annual-true up by the required deadline.
H.
Resolution of
complaints.
1.
Employer complaints
should be processed under the General
Employer Complaint Policy.
2.
Specific extenuating
circumstance that applies to the .99 EM Construction Cap. An employer not
eligible for participation in the initial policy year may request an exception
to participate in the program. BWC may grant participation if all the following
conditions are satisfied:
a.
The employer must
submit the request in writing to BWC;
b.
The policy year of
participation must be on or after July 1, 2016;
c.
The employer’s
predominant premium for the most recently completed policy year must be in
construction, industry type (4); and
d.
The employer meets
all other eligibility criteria as outlined in IV.A. of this policy.