Since the onset of the COVID-19 pandemic, many small business owners face an uncertain future. Predictability allows for proper planning, hiring, inventory, and other key parts of operations. NFIB made a very early plea to get cash into the hands of small business owners. At the state level dividends from the Ohio Bureau of Workers’ Compensation were a great vehicle. Nearly 8 billion dollars were returned to Ohio businesses in 2020.
Before the dividends were issued in late March, BWC told employers they could defer their monthly premium installment payments for March, April, and May until June 1. BWC also waived or postponed some requirements and deadlines for several programs that reduce employer premiums and applied the discounts automatically. BWC has also repeatedly lowered premium rates in recent years, including a 10% cut for public employers that took effect in January and a 13% cut for private employers that began July 1.
The dividend process began on April 8, 2020, when Ohio Governor Mike DeWine and BWC Administrator/CEO Stephanie McCloud proposed giving up to $1.6 billion to Ohio employers this past spring to ease the economic impact of the COVID-19 pandemic on Ohio’s economy and the business community. On April 10th, the Ohio BWC’s Board of Directors approved the dividend.
“News that the Ohio Bureau of Workers’ Compensation (BWC) Board of Directors has approved returning $1.6 billion back to Ohio private employers is welcomed by Ohio’s small business owners. With the state fund comprised almost entirely of small businesses, this will provide a much-needed cash infusion to many entrepreneurs,” said Roger Geiger, Executive Director for NFIB in Ohio.
“We appreciate Governor DeWine and Administrator McCloud for recognizing the importance of putting dollars back in the hands of small business owners during these uncertain times. Every penny counts as they weather this storm and prepare to return to full operations when the battle with COVID-19 ends,” Geiger concluded.
On May 19, 2020, Ohio Governor DeWine announced the BWC would begin distributing at least 2 million non-medical-grade face coverings to Ohio employers who are covered by BWC. Public and private employers participating in the State Insurance Fund will receive a package from BWC containing at least 50 face coverings. BWC shipped 20.6 million masks to 197,000 employers and their workforce.
This was an important step, as a survey conducted of the NFIB membership across Ohio, based on their availability, providing face coverings to employees was identified as the most difficult of the five protocols to comply with during the reopening process.
Then, approved by the Ohio BWC Board at its virtual meeting on September 25, the second dividend of over $1 billion was approved, the second since April and the third dividend since 2019. This dividend again equaled approximately 100% of the premiums paid in policy year 2019. Dividends like this, as well as previous ones, are possible because of strong investment returns on employer premiums, a declining number of claims each year, prudent fiscal management, and employers who work hard to improve workplace safety and reduce injury claims.
“The announcement today that the Ohio Bureau of Workers’ Compensation (BWC) has approved Governor DeWine’s request to return an additional $1.5 billion back to Ohio private employers will provide a helpful cash infusion to small business owners. As the state fund being comprised almost entirely of small businesses, these dollars will be important as the pandemic continues and they see sales suffering,” said Roger Geiger, Executive Director for NFIB in Ohio.
At the time, a survey of NFIB members in Ohio showed a staggering 78 percent of Ohio small businesses are seeing significant revenue losses, with many reporting a hit of 50 percent or greater.
Additionally, Governor DeWine asked BWC’s Board of Directors to approve the second distribution of face coverings to Ohio employers and their workforce as part of BWC’s Protecting Ohio’s Workforce- We’ve Got You Covered program.
In October, Ohio Governor Mike DeWine was joined by Lt. Governor Jon Husted to request the Ohio Bureau of Workers’ Compensation (BWC) send up to $5 billion in dividends to again help Ohio employers to ease the continued financial impact from the COVID-19 pandemic.
“As Ohio businesses confront the economic challenges of a COVID world, this kind of financial relief can be the difference between closing and staying open,” Lt. Governor Husted said. “We don’t want Ohio businesses and the jobs they create to be a casualty of the pandemic.”
“The family-owned businesses across Ohio are still battling this coronavirus crisis. They are working overtime to keep employees and customers safe and continue to serve their communities. Over 50 percent of NFIB members say they are experiencing losses in annual revenue this year of 20 percent or more and a significant number are seeing a dip of greater than 50 percent,” said Roger Geiger, Executive Director for NFIB in Ohio.
“Ohio entrepreneurs are running out of options as 90 percent who took Paycheck Protection Loans have told us they have exhausted those funds. We appreciate Governor DeWine, Lt. Governor Husted, and Administrator McCloud for their strong leadership in putting dollars back in the hands of small business owners that are critical to their very survival during these continued uncertain times,” Geiger concluded.
The final dividend for 2020 was approved at the BWC’s Board of Directors special meeting on Monday, November 2, 2020. The Ohio Bureau of Workers’ Compensation began issuing $5 billion in dividends to Ohio employers during the second week in December, bringing its total dividends this year to nearly $8 billion. All told, 178,415 private and public employers covered by the State Insurance Fund are eligible for the latest dividend through a combination of checks in the mail and credits to their BWC accounts. The final 2020 dividend is nearly four times the premium employers paid in policy year 2019.
Approximately $4.3 billion will go to private employers and $687 million will go to local government taxing districts, such as counties, cities, townships, and schools. BWC will first apply the dividend to an employer’s unpaid balance, then send a check for the rest.
Even after their work to support Ohio employers in 2020, the BWC’s net position remains strong and sufficient to support injured workers for years to come.