Chapter 4141-37 Reimbursing Employer

4141-37-01 Notice of election to become reimbursing employer.

(A) The notice of election to become a reimbursing employer shall be made on a form prescribed by the director, or on a form containing the information, as required herein. The notice must show the total amount of wages paid for covered employment during each of the four completed calendar quarters immediately preceding the date of the notice of election. (Total wages paid for covered employment in any quarter between the quarters shown in the notice and the effective date of the election must be furnished no later than fifteen days following such effective date.) An explanation shall be furnished where less than four quarters of wages are shown, or when wages in one quarter, or several quarters, differ substantially from others. The notice must be signed by a duly authorized official of the organization.

(B) Unless the documents are already on file with the department, the notice must be accompanied by certified copies of:

(1) Resolution by the board of directors, trustees, or other governing body of the electing organization, however denominated, setting forth the organization's election to become liable for payments in lieu of contributions, pursuant to the provisions of section 4141.241 of the Revised Code; and

(2) Letter of exemption from internal revenue service granting exemption from income tax under section 501(a) of the Internal Revenue Code of 1954 with respect to organizations described in section 501(c)(3) of that code.

Effective: 01/01/2006
R.C. 119.032 review dates: 09/28/2005 and 01/01/2011
Promulgated Under: 4141.14
Statutory Authority: 4141.13
Rule Amplifies: 4141.13(G) , 4141.241(A)
Prior Effective Dates: 01/01/72, 07/03/86, 01/15/01

4141-37-02 Definition of bonding amount.

The term "bonding amount" means the total amount of surety bond, approved municipal or other bonds, approved securities, or a combination thereof, or other forms of collateral security approved by the director, required by law and rule to be furnished by a reimbursing employer or group of reimbursing employers. "Approved securities" are those securities approved by the director. The form and execution of the surety bond must be approved by the director.

R.C. 119.032 review dates: 05/20/2013 and 05/01/2018
Promulgated Under: 4141.14
Statutory Authority: 4141.13
Rule Amplifies: 4141.241
Prior Effective Dates: 1/1/72, 7/3/86, 5/29/90, 6/3/96, 1/15/01

4141-37-03 Election notice and bonding amount.

The election notice, unless accompanied by a surety bond or approved municipal or other bonds, approved securities, or a combination thereof, or other forms of collateral security approved by the director, equal to the bonding amount, should contain a statement to the effect that the bonding amount requirement will be met within thirty days of the effective date of the election. Failure to meet such bonding amount requirement will cause the election to become void and the organization shall be or become liable for contributions as of the date on which the election would otherwise have been effective.

R.C. 119.032 review dates: 09/28/2005 and 09/28/2010

Promulgated Under: 4141.14

Statutory Authority: 4141.13

Rule Amplifies: 4141.241

Prior Effective Dates: 1/1/72, 7/3/86, 5/29/90, 6/3/96, 1/15/01

4141-37-05 Estimate of wages for bonding amount.

Where less than four quarters of wages were paid, or when wages in one quarter, or several quarters, differ substantially from others because of abnormal factors, as shown on the notice of election and any supplement thereto, the director, using such information as is available, may estimate the amount of the total wages of the reimbursing employer, or group of such employers, for covered employment for a normal four calendar quarter period and may determine the bonding amount based upon such estimate.

R.C. 119.032 review dates: 09/24/2012 and 09/01/2017
Promulgated Under: 4141.14
Statutory Authority: 4141.13
Rule Amplifies: 4141.241(C)
Prior Effective Dates: 1/1/72, 7/3/86, 5/29/91, 1/15/01

4141-37-06 Adjustment in bonding amount and in surety bond or deposit.

(A) The director shall require an increase in the bonding amount at any time it is determined that the wages of a reimbursing employer, or a group of such employers, have increased substantially over the wages on which the bonding amount was last determined. In such event, such employer, or group of such employers, shall submit a new or amended surety bond, or a deposit of approved municipal or other bonds, approved securities or a combination thereof, or other forms of collateral security approved by the director equal in sum to the increased bonding amount.

(B) On application of a reimbursing employer, or a group of such employers, the director may, for good cause shown, permit a decrease in the bonding amount, when the operations of such employer, or group of such employers, has or have been substantially changed after the bonding amount was last determined. In such event, the reimbursing employer, or group or such employers, may submit a new or amended surety bond, or adjust the deposit of approved municipal or other bonds, approved securities, or a combination thereof, or other forms of collateral security approved by the director, reducing the total to an amount equal to the decreased bonding amount.

(C) When a reimbursing employer fails to make any payment in lieu of contributions when due, the director, by determination, shall require the employer to restore the unobligated security of the account to an amount no less than the bonding amount, which determination may be complied with by submission of a new or amended surety bond, deposit of approved municipal or other bonds, approved securities, or a combination thereof, or other forms of collateral security approved by the director.

(D) The director, with regard to paragraphs (A), (B) and (C) of this rule, shall issue a determination to the reimbursing employer or the members of a group of such employers.

(E) The director shall approve termination of a surety bond prior to the expiration of the term thereof, if there is a change in status of liability of a reimbursing employer.

(F) Without regard to any determination permitting the reduction of the bonding amount, the deposit of approved municipal or other bonds or approved securities, or a combination thereof, or other forms of collateral security approved by the director, shall be released when the director determines that no potential liability remains against an employer's reimbursing account.

R.C. 119.032 review dates: 09/28/2005 and 09/28/2010

Promulgated Under: 4141.14

Statutory Authority: 4141.13

Rule Amplifies: 4141.241

Prior Effective Dates: 1/1/72, 7/3/86, 5/29/90, 6/3/96, 1/15/01

4141-37-08 Deposit of approved municipal or other bonds, approved securities, or other forms of collateral security approved by the director.

(A) The following securities are eligible for the purposes of deposit:

(1) Bonds, notes or other obligations of the United States: or bonds, notes, or other obligations guaranteed as to the principal and interest by the United States or those for which faith of the United States is pledged for the payment of principal and interest thereon, by language appearing in the instrument specifically providing such guarantee or pledge and not merely by interpretation or otherwise;

(2) Bonds, notes, debentures, or other obligations or securities issued by any federal government agency, or the export-import bank of Washington: bonds, notes, or other obligations guaranteed as to principal and interest by the United States or those for which the faith of the United States is pledged for the payment of principal and interest thereon, by interpretation or otherwise and not by language appearing in the instrument specifically providing such guarantee or pledge;

(3) Bonds and other obligations of this state;

(4) Bonds and other obligations of any county, township, school district, municipal corporation, or other legally constituted taxing subdivision of this state, which is not at the time of such deposit, in default in the payment of principal or interest on any of its bonds or other obligations, for which the full faith and credit of the issuing subdivision is pledged.

(5) Negotiable certificates of deposit payable to, or assigned to the treasurer of the state of Ohio.

(a) The denomination of an individual certificate of deposit must not exceed the maximum insurable under the "federal deposit insurance corporation and federal savings and loan insurance corporation."

(b) Only certificates of deposit which are automatically renewable are acceptable.

(B) Any such securities offered for deposit must be registered to the owner with an attached assignment to the treasurer of state or an attached assignment to the Ohio department of job and family services.

(C) Reimbursing employers, or a group of such employers, may substitute one or more approved bonds, or securities, or other forms of approved collateral security, for one or more approved bonds, or securities, or other forms of approved collateral security on deposit. Approved municipal and other bonds shall be maintained at no less than market value equal to the bonding amount, or, where surety bond has also been submitted, equal to the bonding amount less the amount of such surety bond. When the director finds that the market value of such bond is less than that required, he shall order the same to be made whole by determination issued to the employer or to each affected member of a group of employers.

R.C. 119.032 review dates: 09/24/2012 and 09/01/2017
Promulgated Under: 4141.14
Statutory Authority: 4141.13
Rule Amplifies: 4141.241
Prior Effective Dates: 1/1/72, 7/3/86, 5/29/90, 6/3/96, 3/26/99, 12/14/99, 1/15/01

4141-37-09 Failure to comply with determination on surety bond or deposit.

A reimbursing employer's election to make payments in lieu of contributions shall be terminated if such employer fails to comply with:

(A) Any determination of the director increasing the bonding amount or requiring restoration of the unobligated security of an account; or

(B) Any determination of the director ordering that the market value of approved municipal or other bonds, or approved securities, or other forms of collateral security approved by the director, be deposited.

The termination of a reimbursing employer's election shall be effective beginning the first day of the calendar quarter following the employer's failure to comply with determinations provided in paragraph (A) or (B) of this rule.

R.C. 119.032 review dates: 09/28/2005 and 09/28/2010

Promulgated Under: 4141.14

Statutory Authority: 4141.13

Rule Amplifies: 4141.241

Prior Effective Dates: 1/1/72, 7/3/86, 12/30/91, 6/3/96, 1/15/01

4141-37-10 Group accounts.

(A) Two or more reimbursing employers may file a joint application for the establishment of a group account. Such application may be on a form prescribed by the director or on a form containing the information as required herein. Such application shall include:

(1) Identification of the name and reimbursing account number assigned by the department to each employer desiring to participate in the group;

(2) Identification of the name of the group representative;

(3) Authorization for such group representative to act as the group's agent for the purposes of division (D) of section 4141.241 of the Revised Code:;

(4) Signature of an authorized official of each employer joining in the application;

(5) Signature of the group representative or an authorized official of such representative, accepting such agency; and

(6) The application must be accompanied by a certified copy of the resolution by the board of directors, trustees, or other governing body, however denominated, of each applicant organization, authorizing the filing of the application to become a member of such group and having such authorized representative.

(B) The application may be on one form or on separate forms as long as each applicant identifies its own name and reimbursing account number, satisfies the other requirements hereof, and clearly identifies the group for which application is being made.

(C) After review of the application for group account, the director shall issue a determination establishing the account, or disapproving the application in part or in its entirety. Such determination shall be issued to all employers requesting membership in the group. If established, the determination shall list the members of the group and state the effective date of the group account. If the determination disapproves the application in part, written consent thereafter furnished by all applicants approved for group membership shall be the basis for the director to approve the application, as revised, as that of a group for the members that have been approved and the director shall issue a determination as in the establishment of a group account. Where such written consent is not furnished by each member of the group, the entire application shall be disapproved.

(D) After any such approval, the group representative shall be notified of the establishment of the account, the effective date, and names of the members thereof.

(E) No group account shall become effective until after a surety bond, deposit of approved municipal or other bonds, approved securities, or a combination thereof, or other forms of collateral security approved by the director, equal to the bonding amount, has been furnished.

Effective: 01/01/2006
R.C. 119.032 review dates: 09/28/2005 and 01/01/2011
Promulgated Under: 4141.14
Statutory Authority: 4141.13
Rule Amplifies: 4141.24 , 4141.241
Prior Effective Dates: 1/1/72, 7/3/86, 5/29/90, 6/3/96, 1/15/01

4141-37-11 Changes in and termination of group account.

(A) During the first two years after a group account is established, a member of the group may request withdrawal from the group, by providing a copy of the resolution of the board of directors, trustees, or other governing body of such member, however denominated, approving such action and the written consent of each active member of the group to the withdrawal of the applicant. Consent authority may be delegated to the group representative by all of the group members filing a power of attorney authorization for this purpose with the group representative and the department. The director shall approve or disapprove such request and issue appropriate determination, including the effective date on which such request, if granted, shall become effective provided that no withdrawal shall be permitted when approval thereof would result in less than two members remaining in the group, and provided further that, in no event, shall such member withdraw from the group until a new or amended group surety bond, new pledge of a group deposit of approved municipal or other bonds, or approved securities or a combination thereof, or other forms of collateral security approved by the director, or other appropriate changes have been made with respect to security of the account.

(B) After a group account has remained in effect for two years, any member of the group may request withdrawal by providing a copy of the resolution of the board of directors, trustees, or other governing body of such member, however denominated, approving such action and evidence that all other members have been informed of such filing. The director shall approve or disapprove such request and issue appropriate determination, including the effective date as of which such request, if granted, shall become effective, provided that no member shall withdraw from the group until a new or amended group surety bond, new pledge of a group deposit of approved municipal or other bonds, approved securities, or a combination thereof, or other forms of collateral security approved by the director, or other appropriate changes have been made with respect to security of the account, and provided further that where any withdrawal results in less than two members remaining in the group, the director may terminate the group account by issuing an appropriate determination.

(C) A group account may be terminated by request filed at any time after such account has remained in effect for two years. Such request must be signed by an authorized official of each member and must have attached to it a certified copy of the resolution of the board of directors, trustees, or other governing body of each member, however denominated, authorizing such termination. If approved, the director shall prescribe in such determination the date, as of the end of a calendar quarter, after which no further charges to the group account shall be made. Thereafter, the account of the group shall be terminated as of the date on which all group billings have been paid full.

(D) A reimbursing employer desiring to join an existing group shall file an application for membership therein in the manner and form prescribed for the establishment of a group and shall submit the written consent of each active member of the group to the addition thereto of such applicant. Consent authority may be delegated to the group representative by all of the group members filing a power of attorney authorization for this purpose with the group representative and the department. The director shall approve or disapprove such application and issue appropriate determination, including the beginning of the calendar quarter as of which date such application, if approved, is effective, and including further any required change in the bonding amount, provided however that the new member shall not become an active member of such group until a new or revised surety bond, or deposit of approved municipal or other bonds, approved securities, or a combination thereof, or other forms of collateral security approved by the director, has been furnished equal to the bonding amount.

(E) If the group representative fails to pay, when due, any bill issued to it, separate bills shall be prepared and issued to each member of the group, pursuant to division (D)(3) of section 4141.241 of the Revised Code. In such event, failure to pay promptly in full all such individual billings, together with any applicable interest or forfeiture, shall be cause for termination of the group account. In addition, failure to comply with any determination increasing the group bonding amount, or ordering the market value of a deposit of approved municipal or other bonds to be made whole within thirty days of the mailing of such determination, shall be cause for termination of the group account. The director shall terminate the group account by determination prescribing that charges to such account shall cease to be made as of the end of the calendar quarter in which such determination is issued. Thereafter the group account shall terminate as of the date on which all billings outstanding against such account shall have been paid in full, together with any applicable interest or forfeiture.

(F) Termination of a group account, for whatever reason, does not excuse any employer from liability on account of charges for benefits paid after the date on which charges cease to be made to the group account. After collecting unpaid amounts charged to a group account from all available security of such account, the director may transfer amounts remaining unpaid to the reimbursing account or accounts of the employer or employers in default, in which event the group account shall be terminated.

Effective: 01/01/2006
R.C. 119.032 review dates: 09/28/2005 and 01/01/2011
Promulgated Under: 4141.14
Statutory Authority: 4141.13
Rule Amplifies: 4141.241
Prior Effective Dates: 1/1/72, 7/3/86, 5/29/90, 12/30/91, 6/3/96, 1/15/01

4141-37-12 Group bond.

(A) The following methods may be used to satisfy the bonding amount for a group account:

(1) A surety bond, in the bonding amount for the group, naming each member of the group as principal;

(2) A deposit of approved municipal or other bonds, in the bonding amount for the group;

(3) Negotiable certificates of deposit payable to, or assigned to the treasurer of the state of Ohio pledged for the joint and several liability of the members of the group; or

(4) Any combination of surety bond and deposit of approved municipal or other bonds, in the bonding amount for the group, that meets the requirements of paragraphs (A)(1), (A)(2), and (A)(3) of this rule.

(B) The following additional methods may also be used with regard to bonding for a group account:

(1) A separate surety bond for each member of the group, naming such member as principal and securing its obligation as member of a group, in the amount of such reimbursing employer's bonding amount, as determined without respect to such member's membership in a group;

(2) A deposit of approved municipal or other bonds, or approved securities, or other forms of collateral security approved by the director, by each member of the group, pledged for its separate liability as a member of the group, equal to the bonding amount of a reimbursing employer, such bonding amount as determined without respect to such member's membership in a group; or

(3) Any combination of surety bond and deposit of approved municipal or other bonds, or approved securities, or other forms of collateral security approved by the director, in the bonding amount of each member of the group, without respect to such member's membership in a group, that meets the requirements of paragraphs (B)(1) and (B)(2) of this rule.

R.C. 119.032 review dates: 09/24/2012 and 09/01/2017
Promulgated Under: 4141.14
Statutory Authority: 4141.13
Rule Amplifies: 4141.241
Prior Effective Dates: 1/1/72, 7/3/86, 5/29/90, 6/3/96, 1/15/01