In November, the Ohio BWC approved Governor DeWine’s request to send another $5 billion in dividends to Ohio employers. The dividend payments come in the form of paper checks, which the state began mailing out to employers on December 10, 2020, or as credits to employers’ accounts for those employers with outstanding balances owed to the BWC.
These dividend returns are not solely a COVID-19 relief effort; any given year, the Ohio BWC may return dividends to employers based on investment returns on employers’ premiums and the relative number of injury claims for that year. In the 2018 fiscal year, for example, the BWC issued a $1 billion dividend to employers, which amounted to approximately 66% of employers’ annual premiums paid for the prior policy year. In 2019, the BWC returned approximately $1.3 billion to employers, or approximately 85% of the annual premium for the prior policy year.
The amount this year is clearly much higher than years past, however, due in no small part to the COVID-19 pandemic. The $5 billion December dividend brings the total dividends returned to Ohio employers in 2020 to nearly $8 billion, as the BWC had already returned $1.54 billion in late April and then another $1.34 billion in October. The December payment alone amounts to a whopping 372% of premiums paid for the 2019 policy year—the policy period from July 1, 2019 to June 30, 2020 for private employers and the policy period from January 1, 2019 to December 31, 2019 for public employers. This reflects not only the BWC’s desire to assist Ohio employers during a time of particular financial hardship, but also especially good returns on premium investments and a significant decrease in the number injury claims with business activities slowed and many employees working from home or out of work entirely.
To be eligible for the dividend return, employers need to have paid premiums for the policy periods referenced above. Employers also need to have completed their payroll true-up reports for the 2019 policy year by October 2, 2020—the day that the BWC determined eligibility for the dividend. As with previous dividend payments, if an employer has an outstanding balance with the BWC, the dividend will be applied to that first, then a check will be issued for any remainder.
A FAQ for employers on the Ohio BWC website can be found at: https://www.bwc.ohio.gov/downloads/blankpdf/5BillionDividend-FAQ.pdf.