Opinion
No. 20961
Decided June 20, 1928.
Workmen's compensation — Classification of occupations or industries for fixing premium rates — Sections 1465-53 and 1465-54, General Code — General building contractor's payroll not segregated among available classifications for different occupations.
IN MANDAMUS.
This is an original action in mandamus in this court. The petition alleges that the relator is engaged in the business of building office, commercial bank, hospital, theater, factory, and warehouse buildings, apartments, and residences; that the relator is a contributing employer to the state insurance fund and employs three or more workmen that the Industrial Commission classifies occupations or industries with respect to the degree of hazards and fixes the rates of premiums on risks, under Section 1465-53, General Code; that on July 1, 1927, the commission revised its classification of occupations and industries and established compensation rates for the ensuing year; that on January 24, 1928, the relator mailed to the commission its pay roll report of operations for the previous six months period (setting it forth in detail), which the commission refused to accept, but arbitrarily reclassified its pay roll Sheets (at higher rates and premiums), which premiums the relator paid under protest; that had the commission accepted the relator's pay roll report, relator would have paid approximately $364.86 less than it did pay for the six months coverage. Relator alleges that in September, 1927, it applied to the commission for a hearing on the subject of its rates by way of appeal from the ruling of the commission's actuarial and auditing department, but received no relief thereby, although more than four months have elapsed since making its application.
Relator alleges that the respondent's action, in its reclassification of relator's pay roll report, and in its refusal to permit relator "to segregate its pay roll among the available classifications in defendant's manual of rates," is arbitrary and a gross discrimination against relator, which amounts to a taking of relator's property without due process of law, in violation of the due process clause of the Fourteenth Amendment to the Federal Constitution.
Setting forth in its petition certain manual numbers controlling premium rates which should be applied to relator's occupation or industry, which are lower than those established by the commission, the relator contends that it is entitled to avail itself of such lower premium rates, and prays for a writ of mandamus commanding the respondent to accept its pay roll prepared January 24, 1928, and to issue it a pay-in-order in accordance therewith, and also to issue it a "Certificate of Premium," upon payment by the relator to the state treasurer of the amount of premiums called for in relator's said pay roll report.
The answer was substantially a general denial. Testimony was taken on the issue involved, and the cause presented to this court.
Mr. Frank H. Ward, for relator.
Mr. Edward C. Turner, attorney general, and Mr. R.R. Zurmehly, for defendant.
Classification cannot be applied to an occupation or industry as an individual unit. The classification contemplated by the Workmen's Compensation Law (Sections 1465-37 to 1465-108, General Code) relates to occupations or industries as a class, operating generally, under similar conditions. Such is the purport of Section 1465-53, General Code, authorizing the classification of occupations or industries. Under that section classification is not made according to the employment, or number of men engaged in it, or according to the amount paid, but the classification of occupations or industries is made "with respect to their degree of hazard."
Section 1465-54, General Code, imposes upon the commission the duty, in the exercise of its powers and discretion, to fix and maintain for each class of industry the lowest rate of premium consistent with the maintenance of a solvent state insurance fund and the creation of a reasonable surplus, etc. It then provides that annual revision of rates "shall be made in accordance with the experience of said commission," and that the commission shall adopt rules governing revisions compatible with the making of an equitable distribution of losses among the several classes of occupations or industries. The next section (1465-55, General Code) provides for a return of surplus premiums to the subscribers, if it is developed on a revision date that the surplus is larger than is necessary to safeguard the fund's solvency.
The petition alleges that relator is engaged as a general contractor, building large edifices. It is the system of classification applied to this character of occupation or industry that is now under attack. Were we to follow and adhere to the claim of counsel for the relator, its ultimate effect might result in the requirement of classifying certain occupations or industries according to the particular "job" or the size of the various individual jobs engaged in by an employer, and not according to a general system applying to similar industries or occupations as a class.
Mr. Evans, the actuary for the commission, testified that it was not only impracticable, but physically impossible, to classify the occupation of an employee; he said the classification adopted by the commission was based on the nature of the employer's business "and not the various functions that he may do that makes up his particular business;" that the hazard to a carpenter, for instance, depends upon the nature of the industry and the character of the work in which he is engaged; and that the individual carpenter's hazards are not the same in every occupation where a carpenter may be employed. In some the hazards are greater than in others.
Here, and as applied to this relator's business, the commission, under Section 1465-54, General Code, has applied a form of rating system "made in accordance with the experience of said commission." Its revised classification of rates and premiums, now under attack, was adopted pursuant to actuarial reports; and in this classification the occupation of the relator was placed in what is known as Manual No. 5601, which required the payment of a rate premium of $2.50 per $100 pay roll. The actuarial audit of January 1, 1926, made on behalf of the commission, speaking of the system of classification of industries, states that the fund has "used as a basis the classification of industries originally made by the committee of statisticians representing governmental bureaus and workmen's compensation statisticians — and actuaries, as developed by the National Council on Workmen's Compensation Insurance, and the International Association of Industrial Accident Boards."
The experience of men, expert in this department of investigation, whose reports are founded upon experience touching the various hazards of industries and occupations, should be given important consideration; and no doubt the reports of its statisticians and actuaries were followed by the Ohio commission in making its classification of occupations or industries "with respect to their degree of hazard." Section 1465-53, General Code.
The commission was of opinion that employers or building contractors doing business of the generally large character that this relator did should fall within the classification which required that occupation or industry to pay an average fixed premium on all pay roll employees engaged in that class. This classification and its determination are committed to the sound discretion and judgment of the commission. From the evidence adduced we are unable to say that the commission abused its discretion or that it capriciously or arbitrarily discriminated against the relator, who occupies the same class as do others who do business of the same character. We have frequently announced the principle that mandamus may not be employed to control the discretion of a board such as this, and that the writ will not be awarded except where the relator shows that he has a clear, legal right thereto. For the reasons stated, the writ prayed for will be denied.
Writ denied.
DAY, KINKADE, ROBINSON, JONES and MATTHIAS, JJ., concur.
MARSHALL, C.J., dissents.