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TO THE HOUSE COMMERCE AND LABOR COMMITTEE
Tuesday, September 7, 2004
PROPONENT Testimony on HB 498
ON BEHALF OF
THE OHIO CHAMBER OF COMMERCE
Preston J. Garvin
I am Preston Garvin, special counsel to the Ohio Chamber of Commerce, and
I am testifying on behalf of the Ohio Chamber of Commerce in support of
HB 498.
The Ohio Chamber of Commerce supports HB 498 and thanks the sponsors
for putting forth this much needed legislation. The Chamber also thanks
this committee for considering this legislation that will help Ohio’s
economy and help Ohio business compete on a level playing field.
“(Workers’) Compensation shall be in lieu of all other rights
to compensation, or damages, for such death, injuries, or occupational
disease, and any employer who pays the premium or compensation provided
by law, passed in accordance herewith, shall not be liable to respond in
damages at common law or by statute for any death, injuries or occupational
disease.” The foregoing quote is from Article II, sect. 35 of The
Ohio Constitution. This section was added to the Constitution in 1912 to
give employees a right to workers’ compensation benefits in place
of lawsuits against their employer.
As a result of the Constitutional Amendment employers were immune from
lawsuits by employees until 1982. In 1982 the Supreme Court in Blankenship
v. Cincinnati Millicron Chemicals, Inc. (1982),69 Ohio St. 2d 608 held
that an employee is not precluded by the Constitution from suing his or
her employer for an intentional tort. The Court held that employers could
be sued for workplace injuries.
In 1984, the Supreme Court decided Jones v. VIP Development Company (1984),15
Ohio St. 3d 90. This case held that an intentional tort is an act committed
with the intent to injure another or committed with the belief that such
injury is substantially certain to occur. This case also held that the
receipt of workers’ compensation benefits would not preclude an employee
from pursuing a common law action against the employer and that the employer
is not entitled to any set-off in the amount of workers’ compensation
benefits received by the employee. It should be further noted that the
jury is not even aware of the fact that the employee applied for and received
workers’ compensation benefits for the exact same injury that is the
subject of the lawsuit.
Jones v. VIP Development Company opened the flood gates to lawsuits against
employers for workplace injuries. The definition that intentional tort
is an act committed with the belief that an injury is substantially certain
to occur invites experts, hired after the accident, to testify that the
injury was foreseeable and therefore substantially certain to occur.
In response to the increase in lawsuits a bipartisan General Assembly passed
a comprehensive Workers’ Compensation bill to address the intentional
tort problem. The 1986 law defined intentional tort, established an intentional
tort fund paid into by all employers, eliminated a right to a trial by
jury, established a one year statute of limitations and provided that the
Industrial Commission award damages based upon the amount of compensation
paid to the injured worker but not to exceed $1,000,000.
The 1986 legislation was a compromise bill. For assistance with intentional
tort suits the General Assembly made changes in the workers’ compensation
laws. For example, a new form of compensation called wage loss compensation
was created. The 1986 legislation also provided that penalties be imposed
upon employers who violated specific safety requirements and that penalties
be imposed upon self-insured employers who violated Industrial Commission
rules.
In 1991 the Supreme Court declared the intentional tort law unconstitutional.
Brady v. Safety-Kleen Corp. (1991),61 Ohio St.3d 624, held that the intentional
tort statute, a part of the Workers’ Compensation law, did not further
the purposes of Sec. 35, Article II of the Constitution. The Court stated
that injuries resulting from an employer’s intentional torts, even
though committed at the workplace, were utterly outside the scope and purposes
intended to be achieved by Sec. 35. The Court reasoned that the injuries
were totally unrelated to the fact of employment and therefore the Industrial
Commission could have no jurisdiction over such an action and that the
lawsuit would have to be completely separate from the employment. The Court
used this logic even though the industrial injury was the subject of the
lawsuit.
In other cases the cap on damages was found unconstitutional and the limit
on the statute of limitations was also declared unconstitutional.
The 1986 legislation enacted by the bipartisan general assembly held that
the deliberate removal by the employer of an equipment safety guard or
the deliberate misrepresentation of a toxic or hazardous substance was
evidence of an act committed with the intent to injure another. This provision
of the statute was patterned after other states that used similar language
to solve intentional tort problems. The Supreme Court did not address this
definition of intentional tort. The Court ruled that intentional torts
should be separate from workers’ compensation and the Industrial Commission.
As this committee knows, in 1993 and again in 1995, the General Assembly
addressed the intentional tort problem. In both cases the Supreme Court
struck down the legislation. The 1993 and 1995 statutes were very similar.
The 1995 statute was addressed by the Supreme Court in Johnson v. BP Chemicals,
Inc. (1999),85 Ohio St.3d 298. The Supreme Court held that the requirements
imposed by the intentional tort statute were so unreasonable and excessive
that the chance of recovery of damages by employees for intentional torts
committed by employers in the workplace was virtually zero. The Supreme
Court believed that the General Assembly could not pass laws that made
the chance of recovery virtually zero. Therefore the legislation was struck
down.
HB 498 that is before you does not eliminate intentional tort lawsuits.
It does provide that when an employer deliberately removes an equipment
safety guard or deliberately misrepresents a toxic or hazardous substance,
then there is a rebuttable presumption that the injury or occupational
disease occurred as a direct result of the employer’s action. This
legislation, which provides a similar definition to the 1986 definition,
will allow employers to be sued for their actions. However, this legislation
will give certainty as to what constitutes an intentional tortuous act.
Today there is no certainty. We advise clients and Chamber members that
whenever there is a serious workplace injury resulting in loss of life
or limb and resulting in publicity in the community, the employer should
anticipate an intentional tort lawsuit. If the liability is high with the
possibility of a large award of damages, plaintiffs and their attorneys
are willing to expend money and effort in hopes of getting the case before
a jury. The jury will have no knowledge of the payment of workers’
compensation benefits and will only see the badly injured worker and the
employer with a deep pocket.
Many of the cases are disposed of through Motions for Summary Judgment.
Unfortunately, this is only accomplished after a great deal of discovery
expense. Many judges are reluctant to grant Motions for Summary Judgment.
Employers in this state are facing hundreds of intentional tort lawsuits
with plaintiffs seeking damages in the millions of dollars. We will have
other witnesses come before this committee to tell you of some of the lawsuits
filed against employers in this state.
Intentional tort lawsuits have a killing effect on business in the state
of Ohio. This fact was recognized by the bipartisan General Assembly that
enacted the 1985 legislation and also by Governor Richard Celeste who signed
the 1986 legislation into law.
The Ohio Chamber of Commerce urges this committee to pass HB 498.
Thank you.
Respectfully submitted,
Preston J. Garvin
Ohio Chamber of Commerce
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