Latest Case: Delphi Automotive System, LLC v. Ohio Department of Job & Family Services (Labor & Employment Law)

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AUSTIN SARAT

Austin Sarat—Associate Provost, Associate Dean of the Faculty, and William Nelson Cromwell Professor of Jurisprudence and Political Science at Amherst College—comments on the recent news that the Justice Department will seek dismissal of charges against Michael Flynn. Sarat suggests that because the decision does not seem to advance the fair administration of justice in this case, the court should take the unusual step of refusing to grant the prosecutor’s motion to dismiss.

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Delphi Automotive System, LLC v. Ohio Department of Job & Family Services

Citation: 2020-Ohio-2793

Opinion Date: May 7, 2020

Judge: DeWine

Areas of Law: Labor & Employment Law

The Supreme Court reversed the judgment of the court of appeals concluding that a new business would receive the prior business's "experience rating" for purposes of calculating the business's "unemployment tax," holding that because both businesses were not under substantially the same ownership, management, or control at the time the transfer occurred, the new business was not subject to the prior business's experience rating. Ohio employers pay an unemployment tax to support the workers' compensation system. The tax is based partly on an employer's experience rating, which is derived from the amount of unemployment benefits that have been paid to the employer's former employees. In this case, the new employer did not share common ownership, management, or control with the old employer on the date of the transfer. The new employer did, however, hire the old employer's management team. The court of appeals concluded that the new employer would receive the prior employer's experience rating. The Supreme Court reversed, holding (1) the language in Ohio Rev. Code 4141.24(G)(1) requires concurrent ownership, management, or control of both employers at the time that the business or trade is transferred; and (2) therefore, the new employer was not subject to the prior employer's experience rating.