[Until this opinion appears in the Ohio Official Reports advance sheets, it may be cited as Stolz v. J & B Steel Erectors, Inc., Slip Opinion No. 2016-Ohio-1567.]

NOTICE This slip opinion is subject to formal revision before it is published in an

advance sheet of the Ohio Official Reports. Readers are requested to promptly notify the Reporter of De cisions, Supreme Court of Ohio, 65 South Front Street, Columbus, Ohio 43215, of any typographical or other formal errors in the opinion, in order that corrections may be made before the opinion is published.

S LIP O PINION N O . 2016-O HIO -1567

S TOLZ v . J & B S TEEL E RECTORS , I NC ., ET AL . [Until this opinion appears in the Ohio Official Reports advance sheets, it may be cited as Stolz v. J & B Steel Erectors, Inc., Slip Opinion No. 2016-Ohio-1567.] Workers’ compensation—Immunity from tort claims—Self-insured construction projects—R.C. 4123.35(O)—Subcontracto rs enrolled in a self-insuredconstruction-project plan are immune from tort claims made by other enrolled subcontractors’ employees who are injured or killed while working on the self-insured construction project and whose injury, illness, or death is compensable under Ohio’s workers’ compensation law. (No. 2015-0628—Submitted December 2, 2015—Decided April 19, 2016.)

O N O RDER from the United States District Court for the Southern Di strict of Ohio, Western Division, Certifying a Questi on of State Law, No. 1:14-cv-44.

_____________________S UPREME C OURT OF O HIO

2 O’C ONNOR , C.J. {¶ 1} This case is before us on the certif ication of a state-law question by

the United States District Court for the Sout hern District of Ohio, Western Division. The federal court asks that we determine whether Ohio’s workers’ compensation laws, specifically R.C. 4123.35 and 4123.74, pr ovide immunity to a subcontractor

enrolled in a self-insured c onstruction-project plan from a tort claim for workplace injury by an employee of another en rolled subcontractor on the same project. {¶ 2} The unambiguous language of R.C. 4123.35 and 4123.74 compels our

conclusion that subcontractors enrolled in a self-insured-construction-project plan are immune from tort claims made by the employees of other enrolled subcontractors who are injured or killed while working on the self-insured construction project and whose injury, illness, or death is compensable under Ohio’s workers’ compensation law. We therefore answer the certified state-law question in the affirmative.

R ELEVANT B ACKGROUND {¶ 3} The federal court provided the following facts and allegations from which the question of law arises. {¶ 4} The plaintiff in the underlying ac tion, Daniel Stolz, worked as a concrete finisher for Jostin Construction, Inc. (“Jostin”) at the Horseshoe Casino construction project in Ci ncinnati (“Casino Project”) . Messer Construction Company (“Messer”) was the general contr actor for the Casino Project, and Jostin

was a subcontractor. {¶ 5} An accident on the job site injured Stolz, who brought negligence claims against Messer and against subcontractors J & B Steel Erectors (“J & B Steel”), Terracon Consultants, Inc. (“ Terracon”), Pendleton Construction Group, L.L.C. (“Pendleton”), D.A.G. Constructi on Co., Inc. (“D.A.G.”), and TriVersity Construction Co., L.L.C. (“TriVersity”). Stolz claims each of the defendants had responsibilities related to the construction project.January Term, 2016

3 {¶ 6} Prior to the accident, Messer had applied for and obtained authorityfrom the Ohio Bureau of Workers’ Compensation (“BWC”) to act as the selfinsuring employer on the project under R. C. 4123.35(O). In that role, Messer was responsible for providing workers’ comp ensation coverage for its own employees as well as the employees of enrolled s ubcontractors working on the Casino Project, including Jostin, J & B Steel, D.A.G., and TriVersity. {¶ 7} Messer, J & B Steel, D.A.G., and TriVersity 1 moved for summary judgment on the basis that they were imm une from Stolz’s negligence claims under Ohio’s workers’ compensation laws, specifically R.C. 4123.35 and 4123.74. The district court granted summary judgment to the general contractor, Messer, as the self-insuring employer on the Casino Pr oject. But the court denied summary judgment to subcontractors J & B Steel, D. A.G., and TriVersity, finding that an

enrolled subcontractor on a self-insured construction project is immune only from claims made by its own employees and not from those made by employees of fellow

enrolled subcontractors.

T HE Q UESTION OF S TATE L AW {¶ 8} Following the summary-judgment decision, J & B Steel, D.A.G., and TriVersity moved the federal court to certify a question of state law to this court. The federal court granted the motion and certified to us the following question:

Whether Ohio Rev. Code §§ 4123.35 and 4123.74 provide immunity to subcontractors enrolled in a Workers’ Compensation self-insurance plan from tort claims made by employees of [other] enrolled subcontractors injured while working on the self-insured project.

1 J & B Steel, Messer, D.A.G., and TriVersity are the petitioners in this action. Terracon and Pendleton, who were not enrolled subcontractors, did not assert an immunity defense.S UPREME C OURT OF O HIO

4 (Brackets sic.) We accepted the question, 142 Ohio St.3d 1515, 2015-Ohio-2341, 33 N.E.3d 64, and granted Messer’s motion to be designated as a petitioner alongside the three petitioning subcont ractors, 143 Ohio St.3d 1423, 2015-Ohio3021, 34 N.E.3d 935.

A NALYSIS Applicable canons of statutory construction {¶ 9} When a court interprets the meaning of a statute, “[w]ords and phrases shall be read in context and construed according to the rules of grammar and common usage,” R.C. 1.42, and the court must give effect to all of the statute’s words, Bryan v. Hudson , 77 Ohio St.3d 376, 380, 674 N.E.2d 678 (1997). “If the meaning of the statute is unambiguous and definite, it must be applied as written and no further interpretation is necessary.” State ex rel. Savarese v. Buckeye Local School Dist. Bd. of Edn. , 74 Ohio St.3d 543, 545, 660 N.E.2d 463 (1996). Additionally, a court must give effect to the natural and most obvious import of a statute’s language, avoiding any s ubtle or forced constructions. Ohio Neighborhood Fin., Inc. v. Scott , 139 Ohio St.3d 536, 2014-Ohio-2440, 13 N.E.3d 1115, ¶ 22. Ohio’s statutory scheme for workers’ compensation {¶ 10} Ohio’s workers’ compensation sche me is codified in Chapter 4123

of the Revised Code. {¶ 11} R.C. Chapter 4123 requires most employers to pay premiums into the state insurance fund that administers and pays out workers’ compensation claims. R.C. 4123.35(A). In return for these premium payments, an employer, in most cases, receives immunity from claims for common-law and statutory damages made by its employees “for any injury, or occupational disease, or bodily condition, received or contracted by any employee in the course of or arising out of his employment” or for any resulting death. R.C. 4123.74.January Term, 2016

5 {¶ 12} Ohio’s workers’ compensation law contains a special carve-out for “self-insuring employers,” who do not pay into the state insurance fund. R.C. 4123.35(B). Employers eligible for the carve- out “may be granted the privilege to pay individually compensation, and furnish medical, surgical, nursing, and hospital

services and attention and f uneral expenses directly to injured employees or the dependents of killed employees.” Id . In return for providing this coverage, selfinsuring employers receive the same protections against employee claims as those paying into the state fund. R.C. 4123.74. {¶ 13} At issue in this case is a specific class of self-insuring employers recognized in the workers’ compensation scheme: those involve d in a construction project that is “scheduled for completion within six years after the date the project begins” and has total estima ted costs in excess of $100 million. R.C. 4123.35(O). As Messer did with respect to the Casi no Project, the general contractor of a qualifying construction project may seek to self-insure the project and provide workers’ compensation coverage for its own employees as well as the employees of “[a]ll contractors and subcontractors who perform labor or work or provide materials for the construction project” or “[a]ll contractors and * * * a substantial number of all the subcontractors who perform labor or work or provide materials for the construction project.” R.C. 4123.35(O). In return for providing this coverage and satisfying ot her related statutory obligations, the self-insuring employer gains protection against claims arising from the work-related injury or death of any of its own employees as well as the employees of any subcontractors that are enrolled in the self-insurance plan. R.C. 4123.35 and 4123.74. {¶ 14} A subcontractor who enrolls in th e contractor’s self-insurance program does not pay workers’ compensation premiums to the state for the payroll that it reports for work performed at the construction site by covered employees. R.C. 4123.35(O). According to Stolz, subcont ractors interested in enrolling in the self-insurance program deduct their costs for workers’ compensation premiumsS UPREME C OURT OF O HIO

6 from their bids to the contractor becaus e this expense will be undertaken by the self-insured employ er for the project. Application of R.C. Chapte r 4123 to the certified question {¶ 15} The parties agree that a general contractor that is a self-insuring employer on the project receives immunity fr om suits by its own employees as well as the employees of enrolled subcontractor s arising from injuries or death occurring in the course of work on the project. It is also undisputed that the subcontractor who actually employs a worker who is injured or killed on the job is protected from

that worker’s claims. At issue here is whether an enrolled subc ontractor is subject to claims by an employee of a different enrolled subcontractor working on the same self-insured construction project. {¶ 16} In support of his argument that enrolled subcontractors are not immune from suits by other enrolled subc ontractors’ employees on the project, Stolz relies on the placement of the apos trophes in the phrase “contractor’s or subcontractor’s” in the following portion of R.C. 4123.35(O):

The contractors and subcontractor s included under a certificate

issued under this division are en titled to the protections provided under this chapter and Chapter 4121. of the Revised Code with respect to the contractor’s or subcontractor’s employees who are employed on the construction project which is the subject of the certificate, for death or injuries that arise out of, or death, injuries, or occupational diseases that arise in the course of, those employees’ employment on that construction project.

(Emphasis added). Stolz argues that because the italicized phrase employs singular possessive nouns, each subcontractor is prot ected only from claims brought by its own employees.January Term, 2016

7 {¶ 17} Petitioners contend that all subcontractors enrolled in the construction project’s self-insur ance plan are immune from suit by any covered employee. They rely on a different por tion of the same paragraph, stating,

“ [C]ontractors and subcontractors include d under a certificate issued under this division are entitled to the protections provided under this chapter * * *.” Id. Petitioners argue that this statutory language does not explicitly limit immunity to the employer-subcontractor a nd the self-insuring general contractor. Instead, they assert, it offers expansive protection ag ainst claims from the employee of any enrolled subcontractor against any other en rolled subcontractor. We find that the key to answering the certified question lies in R.C. 4123.35(O), though the relevant passage is not quoted by the parties. {¶ 18} Amid the complex statutory framework for workers’ compensation, the General Assembly has created a legal fiction in which the contractor who is the “self-insuring employer” is the legal employer, for workers’ compensation purposes, of all employees of enrolled subc ontractors who are engaged in work at

the construction site. {¶ 19} R.C. 4123.35(O) provides:

A self-insuring employer who complies with this division is entitled to the protections provided under this chapter and Chapter

4121. of the Revised Code with re spect to the employees of the

contractors and subcontractors covered under a certificate issued under this division for death or injuri es that arise out of, or death, injuries, or occupational diseases th at arise in the course of, those employees’ employment on that construction project, as if the employees were employees of th e self-insuring employer * * *.S UPREME C OURT OF O HIO

8 (Emphasis added.) It is with this language that the General Assembly established the legal fiction that the self-insuring employer is the employer of all covered employees, including employees of en rolled subcontractors, for purposes of workers’ compensation. That fiction is reiterated later in R. C. 4123.35(O) with the instruction that “[t]he contractors and subcontractors included under a certificate issued under this division shall identify in their payroll records the employees who are considered the employees of the self-in suring employer listed in that certificate for purposes of this chapter * * *

. ” (Emphasis added). {¶ 20} When R.C. 4123.35(O) is read in conjunction with R.C. 4123.74, as it must be, see Bryan v. Hudson , 77 Ohio St.3d 376, 380, 674 N.E.2d 678 (1997), the statute provides that th e self-insuring employer, who through the legal fiction is the only employer on the project, will “ not be liable to respond in damages at common law or by statute for any injury , or occupational disease, or bodily condition, received or contracted by any empl oyee in the course of or arising out of” work on the self-insured construction project, R.C. 4123.74. {¶ 21} It is also through this legal fiction that the General Assembly gives effect to the provision in the law that “[ t]he contractors and subcontractors included

under a certificate issued under this divisi on are entitled to the protections provided under this chapter * * *.” As describe d above, R.C. 4123.35(O) provides that for the purpose of workers’ compensation matte rs, the employer of all workers on the self-insured construction project is the se lf-insuring employer. Thus, the General Assembly has made clear that for purpos es of workers’ compensation, enrolled subcontractors do not have employees working on the construction project. Accordingly, those subcontractors cannot be liable for the workplace injuries of their own employees on the construction pr oject under the workers’ compensation scheme—the general contractor is the responsible party. {¶ 22} Ohio law also limits recovery through tort law by employees or their families for workplace injury or death fr om any enrolled subcontractor on theJanuary Term, 2016

9 project, to the same extent that recovery is limited by workers’ compensation law. This is true because under the law an employee “ who is injured as a result of a coemployee’s negligent acts, who applie d for benefits under Ohio’s workers’ compensation statutes, and whose injury is found to be compensable thereunder is precluded from pursuing any additional comm on-law or statutory remedy against such co-employee.” Kaiser v. Strall , 5 Ohio St.3d 91, 449 N.E.2d 1 (1983), paragraph one of the syllabus. See also R.C. 4123.741. Accordingly, a worker who may be compensated with workers’ compensation benefits is prevented from suinga co-employee (any other employee on the job site who is enrolled in the selfinsuring employer’s plan), and thus the worker cannot seek to hold the coemployee’s actual employer vicariously liabl e in order to recover damages in tort. See Natl. Union Fire Ins. Co. of Pittsburgh, PA v. Wuerth , 122 Ohio St.3d 594, 2009-Ohio-3601, 913 N.E.2d 939, ¶ 22 (“a principal is vicariously liable only when an agent could be held directly liable”). Stolz’s Argument {¶ 23} In reaching this conclusion, we ar e mindful of the language on which Stolz focuses his argument:

The contractors and subcontractor s included under a certificate

issued under this division are en titled to the protections provided under this chapter and Chapter 4121. of the Revised Code with respect to the contractor’s or subcontractor’s employees who are employed on the construction project which is the subject of the certificate, for death or injuries that arise out of, or death, injuries, or occupational diseases that arise in the course of, those employees’ employment on that construction project.S UPREME C OURT OF O HIO

10 R.C. 4123.35(O). That language relates to the scope of protection a subcontractor enjoys through the self-insurance program. The next sentence also relates to the limited class of covered employees: “[t]he contractors and subcontractors included

under a certificate issued under this divisi on shall identify in their payroll records the employees who are considered the em ployees of the self-insuring employer listed in that certificate for purposes of this chapter * * *.” Id

. {¶ 24} Read in context with the entirety of R.C. 4123.35(O), the import of this language is to clarify that only those employees working on the covered construction project are included in the se lf-insurance program and that they are covered only while they are engaged in work for the construction project. The fact

that a subcontractor is covered under the ce rtificate for the self-insured construction project does not exempt the subcontractor from its indepe ndent obligation to obtain workers’ compensation coverage for thos e employees who are not working on the construction project. Thus, the only reas onable interpretation of “contractor’s or subcontractor’s employees” in R.C. 4123.35(O), on which Stolz relies, is as a limitation on which employees are covered under the self-insurance plan, not which employers are entitled to immunity. {¶ 25} Because our interpretation is based on the plain, unambiguous language of the statute, we do not delve in to the legislative history of the pertinent provisions. Sears v. Weimer , 143 Ohio St. 312, 55 N.E.2d 413 (1944), paragraph five of the syllabus (“An unambiguous statut e is to be applied, not interpreted”). {¶ 26} Nor may we reach Stolz’s policy argument that the social bargain of workers’ compensation begins to break dow n when a construction project is selfinsured. Although we recognize that it ha s some merit, that argument must be directed to the General Assembly, rather than to this court.

C ONCLUSION {¶ 27} We conclude that R.C. 4123.35 a nd 4123.74 create a legal fiction that a self-insuring employer for a self-i nsured construction project is the singleJanuary Term, 2016

11 employer, for workers’ compensation pur poses, of all employees working for enrolled subcontractors on that project . Accordingly, Ohio’s workers’ compensation scheme provides immunity to subcontractors enrolled in a selfinsured construction project from the cl aims of employees of other enrolled subcontractors who are injured or killed while working on the project, provided that the injury, illness, or death is compen sable under Ohio’s workers’ compensation laws. Thus, we answer the certified state-law question in the affirmative.

So answered.

O’D ONNELL , L ANZINGER , K ENNEDY , and O’N EILL , JJ., concur.

F RENCH , J., dissents with an opinion that P FEIFER , J., joins.

_____________________ F RENCH , J., dissenting. {¶ 28} I respectfully dissent from the majority opinion. I agree that if the meaning of the statute is unambiguous and de finite, we must apply it, and we need not interpret it further. State ex rel. Savarese v. Bucke ye Local School Dist. Bd. of

Edn. , 74 Ohio St.3d 543, 545, 660 N.E.2d 463 (1996). In my view, however, the correct analysis of R.C. 4123.35(O) does not require that any paragraph perform double duty in delineating the workers’ comp ensation status of the self-insuring employer, enrolled contractors and subcont ractors, and employees of the enrolled contractors and subcontractors. Instead, each of four sequential paragraphs in R.C. 4123.35(O) sets up an aspect of the worker s’ compensation sche me applicable to self-insured construction projects. {¶ 29} The sixth paragraph of R.C. 4123.35( O) creates a legal fiction in which the self-insuring employer is the em ployer of every enrolled contractor and subcontractor’s employees for worker s’ compensation purposes. It says:

A self-insuring employer who complies with this division is entitled to the protections provided under this chapter and ChapterS UPREME C OURT OF O HIO

12 4121. of the Revised Code with re spect to the employees of the

contractors and subcontractors covered under a certificate issued under this division for death or injuri es that arise out of, or death, injuries, or occupational diseases th at arise in the course of, those employees’ employment on that construction project, as if the employees were employees of the self-insuring employer , provided that the self-insuring employer also complies with this section. No employee of the contractors a nd subcontractors covered under a

certificate issued under this divi sion shall be considered the employee of the self-insuring employer listed in that certificate for any purposes other than this chapter and Chapter 4121. of the Revised Code. Nothing in this division gives a self-insuring employer authority to control the means, manner, or method of employment of the employees of the contractors and subcontractors

covered under a certificate issued under this division.

(Emphasis added.) R.C. 4123.35(O). {¶ 30} R.C. 4123.35(O) requires the self-insuring employer to administer and pay these employees’ eligible workers’ compensation claims. In return, the self-insuring employer receives protection from negligence suits. In short, workers’ compensation benefits are an employee’s exclusive remedy against the self-insuring employer. See Freese v. Consol. Rail Corp. , 4 Ohio St.3d 5, 7, 445 N.E.2d 1110 (1983), citing Ohio Cons titution, Article II, Section 35. {¶ 31} The next paragraph—the one the pa rties primarily contest—extends the protections of R.C. Chapter 4121 a nd 4123 to the enrolled contractors and subcontractors. But it specifies that each enrolled contractor or subcontractor receives this protection with respect solely to its own employees. It provides:January Term, 2016

13 The contractors and subcontractors included under a

certificate issued under this divisi on are entitled to the protections provided under this chapter and Chapter 4121. of the Revised Code with respect to the contractor’s or subc ontractor’s employees who are employed on the construction proj ect which is the subject of the certificate , for death or injuries that ar ise out of, or death, injuries, or occupational diseases that arise in the course of, those employees’ employment on that construction project.

(Emphasis added.) R.C. 4123.35( O) (seventh paragraph). {¶ 32} This provision is necessary because the enrolled contractors and subcontractors do not actually pay work ers’ compensation premiums for their employees on the project. But the cont ractors and subcontractors’ employees remain employees of the contractor and subcontractor employers—even for workers’ compensation purposes—because the contractors and subcontractors retain “the right to control the manner or means of performing the work.” Daniels v. MacGregor Co. , 2 Ohio St.2d 89, 206 N.E.2d 554 (1965), syllabus; R.C. 4123.35(O) (sixth paragraph, discussing self -insuring employer’s protections under R.C. Chapters 4121 and 4123). And generally, to get the protection of the workers’ compensation statutes—immunity from co mmon-law or statutory damages—an employer must pay into the state insurance fund for its employees. Daniels at the syllabus, citing Ohio Constitution, Article II, Section 35, and R.C. 4123.74. Therefore, only the language of the se venth paragraph of R.C. 4123.35(O) extends the protections of R.C. Chapters 4121 and 4123 to these actual employers who do not pay into the state insurance fund. Th at is, the statute creates a second legal

fiction in which the contractor or subcont ractor employers receive the benefits of the workers’ compensation system w ithout directly contributing to it.S UPREME C OURT OF O HIO

14 {¶ 33} The next paragraph limits the self-insuring employer’s workers’ compensation responsibility to those empl oyees who actually work on a particular project. It begins:

The contractors and subc ontractors included under a certificate issued under this division shall identify in their payrollrecords the employees who are considered the employees of the selfinsuring employer listed in that certificate for purposes of this chapter and Chapter 4121. of the Re vised Code, and the amount that those employees earned for employ ment on the construction project that is the subject of that certificate.

R.C. 4123.35(O) (eighth paragraph). {¶ 34} This paragraph provides the mechanism that limits the self-insuring employer’s responsibility for administering and paying workers’ compensation

claims to the enrolled contractors’ a nd subcontractors’ employees who actually work on the self-insured construction project . It accomplishes this by requiring the enrolled contractors and subcontractors to identify in their payroll records their employees who, under the statute’s legal fi ction, are considered employees of the self-insuring employer. {¶ 35} The next and, for our purposes, final paragraph of R.C. 4123.35(O) confirms that fellow-servant immunity does not bar employees of one enrolled contractor or subcontractor from suing empl oyees of another enrolled contractor or subcontractor. In short, this paragra ph preserves an employee’s right to sue tortfeasors employed by other enrolled cont ractors or subcontractors. The majority fails to consider this pr ovision. It provides:January Term, 2016

15 Nothing in this division shall be construed as altering the rights of employees under this chapter and Chapter 4121. of the Revised Code as those rights ex isted prior to September 17, 1996. Nothing in this division shall be construed as altering the rights

devolved under sections 2305.31 a nd 4123.82 of the Revised Code as those rights existed prior to September 17, 1996.

R.C. 4123.35(O) (ninth paragraph). {¶ 36} By its plain language, this provisi on preserves an injured employee’s rights as they existed prior to Septembe r 17, 1996—the effective date of Sub.H.B. No. 245, 146 Ohio Laws, Part II, 2955, which first introduced provisions substantially similar to those now contained in R.C. 4123.35(O), id . at 2971-2976. Then, as now, a worker who was injured on the job and who received workers’ compensation benefits from his employer’s participation in the workers’ compensation system could sue a tortfeasor who was employed by a different employer, subject to the subrogation rights of the workers’ compensation administrator or a self-insuring employer. See R.C. 4123.931 (enacted in 1995, Am.Sub.H.B. No. 278, 146 Ohio Laws, Part II, 3581, 3595-3597; setting forth rights of subrogation with respect to a workers’ compensation claimant’s claims against third-party tortfeasors); R. C. 4123.93 (defining claimant, statutory subrogee, and third party for purposes of subrogation provision). Therefore, an injured employee of one enrolled contractor or subcontractor may sue an employee

of another enrolled contractor or subcontract or who caused the injury, as if the legal fiction created in R.C. 4123.35(O) did not exist. {¶ 37} In short, based on a comprehens ive reading of the relevant provisions, I disagree with the majority’s ultimate holding that R.C. 4123.35(O) and 4123.74 preclude the employees of one en rolled contractor or subcontractor from suing in tort employees of anot her contractor or subcontractor—andS UPREME C OURT OF O HIO

16 recovering from the other contractor or subcontractor under respondeat superior principles. Because I would answer the certified question in the negative, I dissent.

P FEIFER , J., concurs in the foregoing opinion.

_____________________ Goodson & Co. and Brett C. Goodson, for respondent. Kohnen & Patton, L.L.P., and Colleen M. Blandford, for petitioner J & B Steel Erectors, Inc. Patsfall, Yeager & Pflum, L.L.C., Stephen M. Yeager, and Steve Patsfall, for petitioners D.A.G. Construction Co., Inc., and TriVersity Construction Co.,

L.L.C. Green & Green, Jane M. Lynch, and Jared A. Wagner, for petitioner Messer

Construction Co.

_____________________