State ex rel. Sales v. Ohio Pub. Emps. Retirement Bd.
2017 Ohio 7835
| Ohio Ct. App. | 2017Background
- Gary N. Sales, M.D., provided psychiatric services at an ODRC prison (Lorain Correctional Institution) under four successive written personal-service contracts from July 1, 1997 to February 13, 2003.
- Contracts labeled Sales an "independent contractor," specified hourly fees (paid by invoice/1099), and required compliance with institutional scheduling, timekeeping, training, and policies.
- ODRC supplied institutional ID, allowed clock‑in/clock‑out, provided supplies and malpractice coverage, and set patient schedules through nursing staff.
- OPERS denied Sales OPERS membership/service credit, concluding he was an independent contractor; OPERS hearing officer and board upheld that determination.
- Sales petitioned for a writ of mandamus claiming the board abused its discretion; the magistrate recommended denying the writ but the majority of the court sustained Sales’ objections and granted the writ, concluding Sales was a part‑time employee.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Sales was a public employee (entitled to OPERS credit) or an independent contractor | Sales argued the written contracts, 1099 treatment, higher fees, lack of fringe benefits, and absence from payroll show independent‑contractor status favors OPERS credit denial | OPERS/ODRC argued statutory/regulatory factors and institutional requirements (timekeeping, ID, supplied materials, training, schedule control) support independent‑contractor classification | Court majority: Sales was a part‑time employee due to the degree of control and institutional constraints — writ granted; magistrate/board (and dissent) found some evidence supporting independent‑contractor finding and would have denied writ |
| Proper standard for reviewing OPERS determinations | Sales: board must follow R.C. and Adm.Code criteria; courts review for abuse of discretion (some evidence) | OPERS: same — board's decision final; review limited to whether there is some evidence supporting the decision | Court applied the abuse‑of‑discretion / "some evidence" standard but majority found board abused its discretion on legal conclusion given control evidence |
| Weight of Ohio Adm.Code 145‑1‑42(A)(2) factors — conjunctive vs. balancing | Sales emphasized factors demonstrating independent contractor status (contract language, 1099, no fringe, higher pay) | OPERS emphasized balancing under Schaengold and prison‑specific reasons for control features | Magistrate and dissent applied a balancing approach finding some evidence for independent contractor; majority concluded control factors outweighed contractual indicia, supporting employee status |
| Award of attorney fees | Sales requested fees | OPERS opposed | Magistrate recommended denying attorney fees; majority decision grants mandamus but did not adopt an attorney‑fee award (magistrate denied fees) |
Key Cases Cited
- State ex rel. Schaengold v. Ohio Pub. Emp. Retirement Sys., 114 Ohio St.3d 147 (2007) (approves board's balancing approach applying Adm.Code factors)
- Kinsey v. Bd. of Trustees of Police & Firemen's Disability & Pension Fund of Ohio, 49 Ohio St.3d 224 (1990) ("some evidence" standard for abuse of discretion)
- State ex rel. Davis v. Pub. Emps. Retirement Bd., 120 Ohio St.3d 386 (2008) (mandamus proper to review OPERS determinations where no statutory appeal)
- Dreger v. Pub. Emps. Retirement Sys., 34 Ohio St.3d 17 (1987) (OPERS authority limited to statutory grant)
- State ex rel. Pressley v. Indus. Comm., 11 Ohio St.2d 141 (1967) (relator bears burden to show clear legal right and board duty in mandamus actions)