M E M O R A N D U M
TO: James Barnes, Chief Legal Officer
Michael Glass, Director of Employer
Kim Robinson, Director of Policy
FROM: Tom Sico, Director of Legal Operations
SUBJECT: Update on
DATE: March 12, 2007
This memorandum is an update of Legal
Operations’ September 5, 1996 memorandum on interstate jurisdiction. The
previous memorandum set forth many of the most important principles regarding
the interstate jurisdiction of Ohio’s
workers’ compensation laws. This memorandum adds references to more recent case
law and otherwise expounds on some of the matters addressed in the first
memorandum. The following information can be useful to employees handling
customer inquires on interstate jurisdiction.
I. The General Rule
The Ohio workers' compensation
laws apply to employment relationships that the courts have described as
“localized” in Ohio, Prendergast v.
Indus. Comm. (1940), 136 Ohio St. 535, 543, or as having “sufficient
contacts” with this state, State ex rel.
Stanadyne, Inc. v. Indus. Comm. (1984), 12 Ohio St.3d 199, 202. A
totality-of-the-circumstances analysis is used to determine whether an
employment relationship has sufficient Ohio
contacts to be considered localized in this state. The factors examined and
(1) where the contract of employment was
(2) where the injury occurred
(3) where the employee performed the work
(4) the residence or domicile of the employee
(5) the employer’s places of business
(6) the location from which the employee was
supervised and controlled
(7) the state where the employee’s payroll was
(8) the availability of workers’ compensation
in other states
(9) whether the work was to be performed solely
in another state
(10) whether the work was to be performed
exclusively in interstate commerce
(11) the relation of the employee's work to the
employer's place of business, or situs of
the industry, and
(12) the state having supreme governmental
interest in the employee as affecting
his or her social, business, and political
The cases in which those factors
are mentioned include: Prendergast at
538-539; Stanadyne at 202; Bridges v. Natl. Engineering &
Contracting Co. (1990), 49 Ohio St.3d 108, 113; Dotson v. Com Trans, Inc. (1991), 76 Ohio App.3d 98, 104; Lynch v. Mayfield (1990), 69 Ohio App.3d
229, 233; Dailey v. Trimble (Dec. 29,
1995), Franklin App. No. 95APE07-951; Horsley
v. Best Cooling Tower Co. (Sept. 20, 1990), Pike App. No. 447; and Turner v. BWC (May 9, 2003), Miami App. No. 2002-CA-50.
The most important jurisdictional
factor has been said to be the place where the contract of hire was entered. Horsley, supra; Nackley, Ohio
Workers’ Compensation Claims (1994) 60, Section 5.3. But the mere fact that
a worker was hired or injured in this state does not automatically invoke Ohio jurisdiction.
Moreover, the fact that the employer is located in Ohio is not determinative of the issue. The
law looks to the totality of the employment relationship's contacts with Ohio. The residence of
the employee appears to be a comparatively insignificant factor. Horsley, supra; Fulton, Ohio Workers’ Compensation Law (1991)
118, Section 6.18. Further, if an employee was initially hired in Ohio to work in this state, but later is transferred to
work in and be supervised in another state, the employment relationship might
no longer be localized in Ohio.
Dickerson v. Anchor Motor Freight
(Sept. 25, 1991), Hamilton
App. No. C-900714.
BWC employees should be wary in
claims where a self-employed claimant, or both the claimant and employer, have
address that is a post office box. Parties in other states have sometimes
attempted to obtain fraudulent coverage. Where there is some legitimate Ohio contact, however, the Industrial Commission has
consistently held that employers who have paid Ohio premiums in good faith should not be
denied coverage. That practice is also consistent with R.C. 4123.95, which
requires the Ohio
workers’ compensation laws – including the provisions addressing interstate
jurisdiction – to be construed liberally in favor of injured workers and their
In sum, the general rule in
addressing interstate jurisdiction issues is to examine and weigh the factors
that the courts have identified as determining the strength of Ohio’s interest in an
employment relationship. If the contacts with Ohio
are such that the employment relationship is localized in Ohio, this state’s workers’ compensation
Specific Applications of the General Rule
In applying the general rule over
the years, a number of principles have evolved for dealing with specific
situations. These principles are contained in statutory and administrative law,
case law, Industrial Commission and BWC policies, and opinions issued by Legal
Operations. The principles also serve as examples of the types of Ohio contacts needed for
an employment relationship to be considered localized in this state. Among the
principles are the following.
(1) Employee hired in Ohio to work at
an Ohio jobsite, or employee hired outside of Ohio to work specifically in this state: Ohio coverage applies.
“Employees whose contracts of
hire are consummated at a job site in Ohio or
employees who have been hired to work specifically in Ohio
must be protected for workers’ compensation insurance under the Ohio fund.” Rule
4123-17-23(C). Therefore, employees hired in Ohio
to work at an Ohio jobsite are covered by the Ohio workers’
compensation system. Ohio coverage also
applies to employees hired outside of Ohio
to work specifically in this state. These principles are often relevant to
construction workers coming into Ohio
to work on a project. They sometimes enter a new contract of hire for each
construction project even though employed by their usual employers.
(2) Employee hired in Ohio, working
both in Ohio and other states, and the
employer's supervising office is in Ohio: Ohio coverage applies.
“The entire remuneration of
employees, whose contracts of hire have been consummated within the borders of Ohio, whose employment involves activities both within
and without the borders of Ohio, and where the
supervising office of the employer is located in Ohio, shall be included in the payroll
report.” Rule 4123-17-23(A). The term “supervising office,” as used in this
rule, has been said to be the place where “the exercise of control over the
day-to-day activities of employees” occurs. Direct
Transit Inc. v. BWC (Dec. 19, 2000), Franklin App. No. 96AP-1400. (For
information on determining where an employee was hired, see section II.(8)(a)
employee working temporarily outside of this state: Ohio coverage generally applies.
employee who is required to perform temporary duties outside the state has the
full protection of the Ohio
workers’ compensation system without regard to where those duties are
performed, foreign countries included. Young, Workmen’s Compensation Law of Ohio
(2 Ed. 1971) 63, Section 4.10. As stated in Indus.
Comm. v. Gardinio (1929), 119 Ohio St. 539, 542: “The legislative intent is
quite manifest that the provisions of the [workers’ compensation laws] shall
apply to all those employed within the state, and also where, as incident to
their employment, and in the discharge of the duties thereof, they are sent
beyond the borders of the state.”
(a) Form C-110 not required for employees working temporarily outside
Completion of form C-110 is not
needed for coverage to apply to Ohio
employees who are temporarily working outside of this state. Ohio coverage applies to them regardless of
whether the form is completed. In fact, because one of the statutory
requirements for C-110 agreements is that the contract of employment must have
been entered outside of Ohio, the C-110 option
is technically not available for Ohio
employees whose contracts of employment were entered in this state. (See
section II.(8)(a) below.)
(b) How long Ohio coverage applies to
workers temporarily outside of Ohio
As to the length of time Ohio
coverage applies to employees working out of state, the determination is made
on a case-by-case basis and depends on factors indicating whether the
employee's absence from Ohio continues to be temporary (for example, whether
the employee’s main residence is still in Ohio). As the Gardinio court stated, coverage applies where the out-of-state work
is “incident to their employment” in Ohio.
In some situations, coverage has been viewed by Legal Operations as applying to
employees working outside of this state for a year or longer, because the
evidence showed that their absence from Ohio
was still temporary and the work being performed was incident to their Ohio employment.
(c) Other jurisdictions’ requirements should be checked
Even when Ohio coverage applies
to an employee working in another state or a foreign country, and in fact
whenever an Ohio employer has employees working in another jurisdiction, it is
advisable for the employer to become aware of the workers’ compensation
requirements of those jurisdictions in order to be prepared for the possibility
of an injured worker seeking benefits there.
(d) Exception for federal contractors and subcontractors working
outside the U.S.
For employees of employers
working outside the U.S.
as contractors or subcontractors for the federal government, coverage for work-related
injuries usually must be obtained under the federal Defense Base Act. 42
U.S.C.A. §§1651-54. This coverage is exclusive and in place of all liability
under the workers’ compensation laws of any state. 42 U.S.C.A. §1651(c). A few
categories of employees are exempt from the coverage, such as casual workers,
employees working in agriculture or domestic service, and employees working for
contractors that are engaged exclusively in furnishing materials or supplies
for a public work. 42 U.S.C.A. §1654; 1651(a)(3). The Defense Base Act is
administered by the U.S. Department of Labor, Office of Workers’ Compensation
Programs. Employees of these contractors and subcontractors may also be covered
by the War Hazards Compensation Act for injuries arising from a hazard of war,
regardless of whether the injury occurred in the course of employment. 42
U.S.C.A. §§1701-1717. If an injury is not covered by the Defense Base Act but
is covered by both the War Hazards Compensation Act and state workers’
compensation laws, benefits will not be paid under the War Hazards Compensation
Act if benefits are paid under the state laws. 42 U.S.C.A. §1705. But if a
hazard of war causes an injury to an employee while outside the course of
employment, and the employee is therefore not entitled to benefits under the
Defense Base Act and state workers’ compensation laws, the employee may be
entitled to benefits under the War Hazards Compensation Act.
(4) Employment contract entered either in Ohio
or another state and all work to be performed in the other state: Ohio coverage does not
In Indus. Comm. v. Gardinio (1929), 119 Ohio St. 539, 545, the court
said that even though a contract of employment was entered in Ohio, “the Ohio
workmen’s compensation fund is not available to an employee injured while
engaged in the performance of a contract to do specified work in another state,
no part whereof is to be performed in Ohio.” The holding in Gardinio was approved in the more recent
cases of State ex rel. Stanadyne v.
Indus. Comm. (1984), 12 Ohio St.3d 199, 202, and Bridges v. Natl. Engineering & Contracting Co. (1990), 49 Ohio
St.3d 108, 113. Thus, the Ohio workers'
compensation laws do not apply to an employment relationship where the contract
of hire was entered in Ohio
and all the work is to be performed in another state. Ohio
coverage also would not apply to a worker hired in another state to work
exclusively in that state, because the contacts with Ohio are even less in that situation. See Gardinio
at 544. See also Spohn v. Indus. Comm. (1941), 138
Ohio St. 42, 49 (“[A] citizen of
Ohio is not protected by the workmen's compensation law when injured while
performing work of a purely local
character in another state.”).
(5) Employee hired by an Ohio employer to perform transitory work in a number of
states other than Ohio: Ohio
coverage may apply if the employee receives work instructions from, sends
reports to, and is paid from the employer’s facility in Ohio.
There is language in Prendergast v. Indus. Comm. (1940), 136 Ohio St. 535
indicating Ohio coveragecan sometimes apply to an employee who works in a number of states
but never in Ohio.
The court in Prendergast was not
faced with that situation, because the employee had occasionally worked in Ohio for short periods.
But the court said that in situations where an Ohio employer enters into an
employment contract with a person to perform transitory work outside of the
state, and without specification as to the exact location of the work, there is
no good reason why Ohio coverage should not apply. Id.
at 541-542. (Also see section II.(7)(b) below.) The court’s discussion further
indicates, however, that in order for such employment to be considered
“localized” in this state, the employee may need to receive work instructions
from, send reports to, and be paid from the employer’s facility in Ohio. Id.
at 537, 541-543, and 545. Thus, Ohio coverage may apply to an employment relationship
where, even though none of employee’s work is performed in Ohio,
the employee works in a number states such that the contacts with those states
are weak and the contacts with Ohio
are relatively strong. Issues involving these situations should be referred to
Legal Operations for review.
(6) Employee a resident of another state, contract of employment
entered outside of Ohio, work to be performed
in Ohio for a temporary period not to exceed
90 days, and insurance coverage in effect under the workers' compensation laws
of another state: Ohio
coverage does not apply.
“If an employee is a resident of
a state other than this state and is insured under the workers’ compensation
law or similar laws of a state other than this state, the employee and his
dependents are not entitled to receive compensation or benefits under this
chapter, on account of injury, disease, or death arising out of or in the
course of employment while temporarily within this state and the rights of the
employee and his dependents under the laws of the other state are the exclusive
remedy against the employer on account of the injury, disease, or death.” R.C.
4123.54(B). Whether this exemption applies depends on the length of time the
injured worker has been in Ohio or is expected
to be in Ohio
at the time of injury. Villasana v. BWC
(April 20, 2004), Tuscarawas App. No. 2003 AP 09 0070. For purposes of applying
the exemption, the term “temporarily within this state” is defined at Rule
4123-17-23(C) as “a temporary period not to exceed ninety (90) days.” The rule
also specifies that the exemption applies only where the “contracts of hire
have been consummated in some state other than Ohio.”
(a) Calculating the 90 days
The courts have not specifically
ruled on whether the 90 days should be consecutive or cumulative for the
exemption to apply. But in interpreting the term “temporarily” as used in R.C.
4123.54(B), and without reference to R.C. 4123-17-23(C), courts have held that
the word should be given its ordinary meaning of “for a brief period: during a
limited time: briefly. . . .” Davis v. BWC
(March 27, 1996), Hamilton
App. No. C-950150; Fowler v. Paschall
Truck Lines Inc. (July 27, 1995), Franklin App. No. 94APE11-1654. The court
looked at the days cumulatively rather than consecutively, and held that an
employee who worked as a door repair helper in Ohio for a total of 113 days was covered for
an injury sustained in this state. Even though the worker was a Kentucky resident who drove to his employer’s Kentucky office each work day to receive assignments, a
majority of the assignments were in Ohio.
The court in Fowler also examined the
cumulative time an employee worked in Ohio.
But that court denied benefits to the widow of an interstate truck driver who
was an Illinois resident killed while
unloading his truck in Ohio.
The employer was a Kentucky corporation, had
no facility in Ohio,
and was engaged solely in interstate commerce in this state. Only a small
portion of the employee’s work was performed in Ohio. Although his job required him to
regularly return to Ohio
for short periods, the court said this did not alter the temporary nature of
his presence there. These cases indicate that two factors should be considered
in determining the amount of time worked in Ohio:
(1) the cumulative number of days worked or expected to be worked in this
state; and (2) whether the nature of the work is such that it occurs only
“briefly” and for “a limited period” in Ohio.
Under this standard, cumulative days exceeding 90 would mean Ohio
coverage applies unless the circumstances show that the work is done only
briefly in Ohio.
As the amount of time needed to work more than 90 cumulative days increases, so
does the likelihood of finding that the work is done only briefly in Ohio. The Davis and Fowler cases also indicate that whether the work is performed in
interstate commerce can be an important consideration in these determinations.
(See section II.(7) below.)
(b) Form C-112 can extend the 90-day exemption
In regard to an employee hired
outside of Ohio, performing some work outside of this state, and covered by the
workers' compensation laws of another state in which some of the work is
performed, the employer and employee can extend the 90-day exemption by using
form C-112 to agree that the other state's coverage will be the exclusive
remedy in the event of an injury. (See section II.(8) below.) R.C. 4123.54(B)
provides that the agreement “shall remain in force until terminated or modified
by agreement of the parties similarly filed.”
(c) Exemption does not apply where any of the statutory requirements are
In Wartman v. Anchor Motor Freight Co. (1991), 75 Ohio App.3d 177,
181, the court interpreted the “temporarily within this state” exemption in
R.C. 4123.54(B) to mean that “an employee is not entitled to receive
compensation or benefits for an injury when that employee (1) is a resident of
a state other than Ohio, (2) is insured in a state other than Ohio, and (3) is
only temporarily in Ohio. All three conditions must exist to preclude
compensation; the absence of one condition will result in the general
entitlement, under R.C. 4123.54, of every employee to compensation or
benefits.” In applying this rule, the court held that Ohio coverage applied to a non-Ohio resident
who was injured while working temporarily in this state for a non-Ohio
employer, because the worker was not covered by the workers' compensation laws
of another state at the time of injury. The exemption can apply, however, even
if an injured worker has been denied benefits in the other state, provided that
the state had jurisdiction over the claim. The court explained that “an
employee is not ‘insured’ in another state when, although his employer has
secured a policy of insurance in that other state, he is precluded by that
other state from entitlement to compensation on a jurisdictional or
quasi-jurisdictional basis….” Id. at 183. Accord Villasana v. BWC (April 20,
2004), Tuscarawas App. No. 2003 AP 09 0070.
(d) Exemption does not apply to residents of foreign countries working
temporarily in Ohio
As for residents of other
temporarily in Ohio,
BWC’s coverage apparently applies to them regardless of how long they are
working in this state. Under R.C. 4123.54(B), residents of a “state” other than
excluded from coverage while temporarily in this state. R.C. 1.59 defines
“state” as used in Ohio law as “any state,
district, commonwealth, territory, insular possession thereof, and any area
subject to the legislative authority of the United States….” In Savage v.
Correlated Health Service (Oct. 17, 1990), Summit App. Nos. 14491, 14498,
the court said that a physician licensed in the Canadian province of Ontario
is not licensed by a “state” within the definition at R.C. 1.59. As a result,
Legal Operations has not viewed the exemption from Ohio
workers’ compensation coverage contained in R.C. 4123.54(B) as applying to
residents of a foreign country working temporarily in Ohio. Although the suggestion has been made
that the failure to apply R.C. 4123.54 to Canadian and Mexican residents may
violate the North American Free Trade Agreement (NAFTA), no such finding has
been made by the federal government despite being notified of the possible
problem a number of years ago. In the absence of such a finding, BWC is
obligated to enforce the law as written. See
19 U.S.C.A. §3312(b)(2)
(“No State law, or the application thereof, may be
declared invalid as to any person or circumstance on the ground that the
provision or application is inconsistent with [NAFTA], except in an action
brought by the United States for the purpose of declaring such law or
(7) Employee hired outside of Ohio by
a non-Ohio employer, performing some work outside of Ohio,
and entering Ohio to perform transitory
services in interstate commerce: Ohio
coverage generally does not apply.
“The remuneration of employees of
other than Ohio employers, who have entered
into a contract of employment outside of Ohio
to perform transitory services in interstate commerce only, both within and
outside of the boundaries of Ohio,
shall not be included in the payroll report.” Rule 4123-17-23(B). This
principle, which is often relevant to interstate truck drivers, applies even if
the employee is an Ohio
resident. Spohn v. Indus. Comm.
(1941), 138 Ohio St.
42. Ohio coverage generally does not apply to those workers if they were hired
outside of Ohio by a non-Ohio employer, perform some work outside of Ohio, and
enter this state only to perform
transitory services in interstate commerce.
coverage may apply where there are intrastate aspects to the work
Where there are intrastate
aspects to a truck driver's work in Ohio, this
state's coverage may apply if the jurisdictional contacts with Ohio are sufficient. In Holly v. Indus. Comm. (1943), 142 Ohio St. 79,
88, the court held that Ohio coverage applied
to a truck driver performing services indiscriminately in interstate and
intrastate commerce in Ohio, even though he
was a non-Ohio resident, was hired in Pennsylvania
by a Pennsylvania company, and was killed
while engaged in interstate commerce in Ohio.
(In addition to the intrastate aspects of the employee's work in Ohio, it was also significant that the employer, although
based in Pennsylvania, had three terminals in Ohio and had obtained Ohio workers' compensation coverage.)
(b) Where the employment contract was entered can be important
Also relating to trucking, it has
been said that when the work is not confined to a single state, but is to be
performed in interstate commerce, the location where the employment contract
was entered into becomes an important consideration in determining which
state's workers’ compensation jurisdiction applies. Spohn at 47-48. Additionally, as mentioned in section II.(5) above,
the court in Prendergast said that
where an Ohio employer enters into an employment contract with a person to
perform transitory work outside of this state, and without specification as to
the exact location of the work, there is no good reason why Ohio coverage
should not apply. The court also indicated that other important considerations
in such circumstances are whether another state’s coverage applies to the
employee and whether the employee receives work instructions from, provides
reports to, and is paid from the employer’s facility in Ohio.
(c) The home-terminal consideration
It has often been said that
jurisdiction over interstate truckers is generally determined by their terminal
of “domicile,” the industry term for home terminal. Courts have described a
“home terminal” as the place where the driver customarily receives work
assignments. Cincinnati Ins. Co. v. Haack
(1997), 125 Ohio
App.3d 183, 208. The court in Dotson v. Com Trans, Inc. (1991), 76
Ohio App.3d 98, 104-105, however, held that although a truck driver's contract
of hire was entered outside of Ohio with a non-Ohio employer, and the injury
occurred outside of this state, Ohio's coverage applied because the driver, an
Ohio resident, paid Ohio taxes and performed a significant part of his work in
Ohio each day. In an analogous situation involving a technician who was hired
in Michigan and regularly worked in Ohio and four other states, a court ruled
that even though the injury occurred in New Jersey and the injured worker
received benefits under the workers’ compensation laws of that state, Ohio
jurisdiction also applied because the worker was an Ohio resident, paid Ohio
taxes, and performed at least 70% of his work in this state. Turner v. BWC (May 9, 2003), Miami App. No. 2002-CA-50.
Further, the court in McBride v. Coble
Express, Inc. (1993), 92 Ohio App.3d 505, 507 ruled that even though the
employer was an Indiana company, Ohio coverage applied to a truck driver who
was a resident of Ohio, worked primarily in Ohio, and was injured in Ohio.
Thus, the “home terminal” rule is not without exceptions, particularly where a
worker has other significant contacts with this state.
(8) Where there is a possibility of conflict with the workers'
compensation laws of another state, the contract of employment was entered
outside of Ohio, and all or some portion of the work is to be performed outside
of Ohio: Form C-110 can be used to choose Ohio law as the exclusive remedy and
Form C-112 can be used to choose the law of another state as the exclusive
R.C. 4123.54 provides that if
there is a possibility of conflict with respect to the application of workers’
compensation laws because the contract of employment was entered into and all
or some portion of the work is to be performed in a state or states other than
Ohio, the employer and employee may agree in writing to be bound by the
workers’ compensation laws of Ohio or the laws of some other state in which all
or some portion of the work is to be performed. Under Rule 4123-17-23(D), form
C-110 is used to choose Ohio coverage and form C-112 is used to choose the laws
of another state in which all or some of the work is to be performed.
(a) Determining where the contract of employment was entered
In order for a form C-112 to be
valid, the contract of employment must have been entered into in a state other
than Ohio. Watson v. Toledo Labor Service, Inc.
(1988), 46 Ohio
App.3d 141, 143. The language of R.C. 4123.54(B) indicates that the same
requirement applies to form C-110. A contract is “entered into” at the place
where it is executed. Lanier v. Northern
Steel Transport Co. (Dec. 16, 1994), Lucas App. No. L 94-100. In regard to
entering contracts, “execute” means to sign or otherwise bring a contract into
its final, legally enforceable form. Black’s
Law Dictionary (7th Ed. 1999) 589. Thus, when the parties are in
different states, the contract is generally considered entered into at the
place where the last act occurs that makes it binding and enforceable, which is
usually where the acceptance occurs. As
stated at 16 O Jur 3d, Conflict of Laws §10: “[A] bilateral contract is made
where the second promise is made, and if the acceptance is mailed from one
state to another, the contract is made where the letter of acceptance is posted
(if use of the mail is authorized).” Likewise, 16 Am Jur 2d, Conflict of Laws
§99 explains: “Where an acceptance of an offer is given by telephone, the place
of contracting generally is where the acceptor speaks his or her acceptance.”
must have active coverage and form must be filed within 10 days of
A form C-110 or C-112 must be
filed with BWC within ten days of its execution to be valid. R.C. 4123.54(B); Dotson v. Com Trans, Inc. (1991), 76 Ohio App.3d 98, 102.
Moreover, the agreements are invalid on their face if the employer is
noncomplying. An employer must, therefore, maintain an active BWC policy in
order for the agreement to be valid, regardless of whether payroll is
reportable to Ohio.
(c) There must be a
possibility of dual jurisdiction for the forms to be used
R.C. 4123.54(B) permits a choice
of laws when there is a “possibility of conflict” between the workers’
compensation laws of different states. A form C-110 or C-112 cannot by itself
“create” jurisdiction; it merely clarifies which state’s laws will apply in the
event of a possible conflict. In other words, if Ohio
does not otherwise have jurisdiction over a workers’ compensation matter,
completion of form C-110 will not by itself create jurisdiction in Ohio. Similarly, if Ohio has jurisdiction over a workers’ compensation matter
and another state does not, completion of form C-112 will not by itself divest Ohio of jurisdiction. There
are three important situations in which these principles apply:
(i) Employment relationship where
the only contact with Ohio
is that the employer has an office or other facility in this state: Form C-110
should not be used.
In the situation where a company
has an office or other facility in Ohio and an
operation in another state, Ohio
does not have jurisdiction over persons who are hired at the out-of-state
facility, reside in the other state, are supervised and controlled there,
perform all their work there, and sustain an injury there. (See Indus.
Comm. v. Gardinio, discussed in section II.(4) above.) Thus, form C-110
should not be used for employment relationships where the only contact with this state is that the employer has an office or
other facility in Ohio.
Rather, coverage should be obtained for the employees in the state where they
are supervised and working. Even if the worker resides in Ohio, this state’s jurisdiction may not apply
in the absence of additional jurisdictional contacts.
Nevertheless, if the employment
relationship has additional contacts with this state (such as the employee
receives work directions from Ohio), or the contacts with the other state are
somewhat weaker (such as the employee is working out of his or her home rather
than in a branch facility of the employer), Ohio’s jurisdiction may or may not
be invoked, depending on the nature of the jurisdictional contacts with Ohio.
These types of C-110 issues involving marginal contacts with Ohio should be referred to Legal Operations
(ii) Truck driver hired outside
of Ohio by a non-Ohio employer and entering Ohio to perform
transitory services in interstate commerce only: Form C-110 generally should not
Form C-110 should not be used to
attempt to obtain Ohio coverage for truck
drivers who are hired outside of this state by non-Ohio employers, come into Ohio only to perform transitory services in interstate
commerce, and are covered by another state’s workers’ compensation jurisdiction
when in Ohio.
As explained in section II.(7) above, Rule 4123-17-23(B) directs that the
remuneration of such workers not be included in Ohio payroll reports.
However, if the interstate truck
drivers are covered by an all-states rider issued by a private insurer in
another state, and that policy excludes coverage for injuries occurring in a
monopolistic state such as Ohio, the employer needs Ohio coverage for injuries
that may occur in Ohio.
resident hired outside of Ohio, covered by the
workers' compensation laws of another state, and working in Ohio for a temporary period not to exceed 90
days: Form C-110 should not be used.
Form C-110 should not be used to
attempt to obtain coverage for a non-Ohio resident who was hired outside of Ohio, is covered by the workers’ compensation laws of
another state, and is working in Ohio
for a temporary period not to exceed 90 days. R.C. 4123.54(B) and Rule
4123-17-23(C) provide that Ohio
jurisdiction does not apply to such workers. (See section II.(6) above.)
III. Additional Considerations
In dealing with interstate
jurisdiction issues, the following considerations should also be kept in mind.
(1) Workers' compensation benefits awarded in another state having
jurisdiction over the injury and a claim is also filed with BWC: Ohio's jurisdiction may apply to the injury, but amounts
awarded in the other state are credited against amounts awarded in Ohio.
“If any employee or his
dependents are awarded workers’ compensation benefits or recover damages from
the employer under the laws of another state, the amount awarded or recovered,
whether paid or to be paid in future installments, shall be credited on the
amount of any award of compensation or benefits made to the employee or his
dependents by the bureau.” R.C. 4123.54(B). Thus, the fact that a claimant
received workers’ compensation benefits in another state does not preclude the Ohio workers’
compensation laws from applying to the same injury. McBride v. Coble Express, Inc. (1993), 92 Ohio App.3d 505, 510. The normal
jurisdictional analysis must be conducted to determine whether Ohio’s workers'
compensation coverage also applies to the injury. The amount awarded in the
other state must be credited against any award made in Ohio. The credit also applies to benefits an
injured worker has received under the federal Longshore and Harbor Workers’
Compensation Act. State ex rel. Pittsburgh
& Conneaut Dock Co. v. Indus. Comm. (May 5, 2005), Franklin App. No. 04-AP-616.
(See section III.(5) below.)
(2) Out-of-state insurer provides benefits for an injury that is later
found to be covered by the Ohio
workers' compensation laws and is also found to not be covered by the workers'
compensation laws of the state where benefits were paid: BWC must reimburse the
insurer for benefits paid.
Where an injury occurs in another
state and an out-of-state insurer provides interim benefits to the claimant
while the facts of the case are being developed and it is unclear who is
responsible for paying benefits, BWC must reimburse the insurer for amounts
paid if the facts later show that Ohio had jurisdiction over the claim and the
other state did not. Liberty Mut. Ins. Co. v. Indus. Comm. (1988),
40 Ohio St.3d
(3) Railroad employees: Ohio
jurisdiction generally does not apply.
The Federal Employers' Liability
Act (FELA) imposes liability on interstate railroads for negligence resulting
in the injury or death of their employees. 45 U.S.C.A. §51 et seq. This law
provides an exclusive source of recovery for railroad employees injured or
killed while working in interstate commerce. New York Central Railroad Company v. Winfield (1917), 244 U.S. 147, 153-154.
Nonetheless, R.C. 4123.04
provides that if employees are engaged in intrastate commerce and also in
interstate or foreign commerce, and Congress has established a rule of
liability or method of compensation for them, Ohio workers' compensation coverage can
apply if certain conditions are met. The conditions are: (1) the intrastate
work must be “clearly separable and distinguishable” from interstate or foreign
commerce; (2) the “separable” work, for its duration, must be exclusively in
Ohio; (3) the employer and the worker must voluntarily accept Ohio coverage in
a writing filed with BWC; (4) BWC must approve the coverage; and (5) no act of
Congress forbids the coverage. See Nackley, Ohio Workers’ Compensation Claims (1994) 55,
Section 5.1. The statute also provides that BWC's approval of the filing
“irrevocably” subjects the parties to Ohio's
coverage during the period for which premiums were paid.
(4) Admiralty jurisdiction: Ohio
jurisdiction does not apply.
The Merchant Marine Act of 1920,
popularly known as the Jones Act, provides seamen with a right of action
against their employers for negligence. 46 U.S.C.A. §30104 (formerly at 46
U.S.C.A. §688). In Chandis, Inc. v.
Latsis (1995), 115 S. Ct. 2172, 2190, the U.S. Supreme Court said an
employee qualifies as a “seaman” when two elements are met: (1) the worker's
duties must contribute to the function of a vessel or to the accomplishment of
its mission; and (2) the worker must have a connection to a vessel in
navigation (or an identifiable group of such vessels) that is substantial in
terms of both its duration and nature. The court said
the purpose of the second element is to “separate the sea-based maritime
employees who are entitled to Jones Act protection from those land-based
workers who have only a transitory or sporadic connection with a vessel in
navigation, and therefore whose employment does not regularly expose them to
the perils of the sea.” The Court also noted that seamen “do not
lose … protection automatically when on shore and may recover under the Jones
Act whenever they are injured in the service of a vessel regardless of whether
the injury occurs on or off the ship.”
It has been held that a seaman
who suffers injury on the navigable waters of the U.S. cannot constitutionally be
provided a remedy under state workers' compensation laws. Bearden v. Leon C. Breaux Towing Co., Inc. (3rd Cir. 1978), 365
So.2d 1192, 1195. Moreover, an “agreement between [an] employer and employee to submit themselves
to the provisions of the Workmen's Compensation Act cannot confer jurisdiction
upon the Industrial Commission in case of injury occurring in a purely maritime
employment, the admiralty courts having in such case exclusive jurisdiction.”Faulhaber v. Indus. Comm. (1940), 64 Ohio App. 405, 406. Thus, an Ohio workers’
compensation claim cannot be allowed for an injury covered by the Jones Act.
(5) Longshore and Harbor Workers:
concurrent federal and state jurisdiction sometimes applies
For work-related injuries
sustained by land-based maritime workers, Congress provided a remedy in the
Longshore and Harbor Workers' Compensation Act.
33 U.S.C.A. §901 et seq. A maritime employee is defined by that Act as
“any person engaged in maritime employment, including any longshoreman or other
person engaged in longshoring operations, and any harbor-worker including a ship
repairman, shipbuilder, and ship-breaker....” 33 U.S.C.A. §902(3). In
construing this definition, the U.S. Supreme Court in Herb's Welding, Inc. v. Gray (1985), 470 U.S. 414, 423-424 said
that although the term “maritime employment” is not limited to the occupations
specifically mentioned in the statute, an occupation must have a connection
with the loading, construction, or repair of ships in order to come within the
definition. Federal jurisdiction applies to such employees “if the disability
or death results from an injury occurring upon the navigable waters of the United States
(including any adjoining pier, wharf, dry dock, terminal, building way, marine
railway, or other adjoining area customarily used by an employer in loading,
unloading, repairing, dismantling, or building a vessel).” 33 U.S.C.A. §903(a).
Some injuries covered by the
Longshore and Harbor Workers’ Compensation Act may also be covered by the Ohio
workers’ compensation system. In Hahn v.
Ross Island Sand & Gravel Co. (1958), 358 U.S. 272, 273, the U.S.
Supreme Court recognized that certain employment relationships, although
maritime in nature, are so “local” that state workers' compensation laws may
apply to them. Also, in Sun Ship, Inc. v.
Pennsylvania (1980), 447 U.S.
715, 716, the U.S. Supreme Court held that state workers' compensation programs
may exercise concurrent jurisdiction over “land-based” injuries sustained by
maritime employees. In such cases, amounts paid under the federal law are
credited to amounts awarded under the Ohio
workers’ compensation system. (See section III.(1) above.) Further, in regard
to a work-related death that occurred on navigable waters but was not covered
by federal jurisdiction, an Ohio court ruled
workers' compensation coverage applied. Edwards
v. Stringer (1978), 56 Ohio
App.2d 283, 286.
(6) Situations where Ohio workers'
compensation coverage does not appear to apply but reasonable minds might
disagree: Employer may obtain an Ohio
policy by paying the minimum administrative fee and security deposit to protect
against possible noncompliance claims.
In situations where BWC and an
employer believe that the Ohio
workers’ compensation laws probably do not apply to an employment relationship,
but there is concern about possible noncompliance liability of the employer if
the Industrial Commission or a court ever reached a different conclusion, the
employer may protect itself from such liability by keeping an account open at
BWC. This can be done by paying the minimum administrative fee set forth in
Rule 4123-17-26 for each six months of coverage. The court in Bridges v. Natl. Engineering &
Contracting Co. (1990), 49 Ohio St.3d 108, 117 said: “For purposes of this
and any other civil action, we hold that once the Industrial Commission has certified
that an employer has established industrial coverage and paid its premium, the
employer is a complying employer as a matter of law. Such employer’s failure to
have included a particular injured employee in a required payroll report does
not deprive the employer of its statutory immunity from a civil action brought
by the employee.” Although BWC rather than the Industrial Commission is now
responsible for certifying that an employer has obtained coverage and paid
premiums, the same principle applies.
Thus, while an employer's account
is active at BWC, the employer is not susceptible to being declared a
noncomplying employer and held liable for the costs of a claim allowed against
it in Ohio.
But if a claim is allowed for an employee whose pay was not included on the
employer's payroll reports submitted to BWC, the employer can be liable for
back payment of premiums and subject to penalties for failure to correctly
In dealing with interstate
jurisdiction issues, the general rule is to examine and weigh the factors
listed in section I of this memorandum, unless the employment relationship is
addressed by a more specific guideline in sections II or III. The application
of these principles will in many cases reveal whether Ohio's jurisdiction covers an employment
relationship. However, in applying the general rule, it is not always clear how
much weight to give the factors present in a particular situation. Moreover, in
some cases uncertainties are encountered in deciding whether an employment
relationship is covered by one of the specific guidelines. When difficulties
arise in dealing with interstate jurisdiction issues, Legal Operations is
available to assist.