diff --git a/docs/changelog/7.x.x.txt b/docs/changelog/7.x.x.txt
index 5038c4443..6853dfd8f 100644
--- a/docs/changelog/7.x.x.txt
+++ b/docs/changelog/7.x.x.txt
@@ -5,6 +5,7 @@
  - fixed #12033: scratch variable problems during export
  - fixed: Underground label style forces radio buttons and check boxes to render vertically.
  - fixed #11704: JavaScript::Packer, HTML::Packer, and CSS::Packer use $& variable
+ - fixed #12038: Incorrect caching of groups with 0 second cache setting (Dale Trexel)
 
 7.10.8
  - rfe #12016 for the top story as well
diff --git a/lib/WebGUI/Group.pm b/lib/WebGUI/Group.pm
index 9dc05b017..94f09b058 100644
--- a/lib/WebGUI/Group.pm
+++ b/lib/WebGUI/Group.pm
@@ -259,7 +259,9 @@ sub cacheGroupings {
         $groupMembers->{$userId} = { isMember => $isInGroup };
     }
 
-    $cache->set($groupMembers, $self->groupCacheTimeout);
+    if ($self->groupCacheTimeout()) {
+        $cache->set($groupMembers, $self->groupCacheTimeout);
+    }
 }
 
 #-------------------------------------------------------------------
@@ -630,7 +632,9 @@ sub getAllUsers {
 	}
 	my %users = map { $_ => 1 } @users;
 	@users = keys %users;
-	$cache->set(\@users, $self->groupCacheTimeout);
+    if ($self->groupCacheTimeout()) {
+        $cache->set(\@users, $self->groupCacheTimeout);
+    }
 	return \@users;
 }
 
diff --git a/t/Group/group_scratch.t b/t/Group/group_scratch.t
new file mode 100644
index 000000000..464487824
--- /dev/null
+++ b/t/Group/group_scratch.t
@@ -0,0 +1,46 @@
+# vim:syntax=perl
+#-------------------------------------------------------------------
+# WebGUI is Copyright 2001-2009 Plain Black Corporation.
+#-------------------------------------------------------------------
+# Please read the legal notices (docs/legal.txt) and the license
+# (docs/license.txt) that came with this distribution before using
+# this software.
+#------------------------------------------------------------------
+# http://www.plainblack.com                     info@plainblack.com
+#------------------------------------------------------------------
+
+use FindBin;
+use strict;
+use lib "$FindBin::Bin/../lib";
+use Test::More;
+use WebGUI::Test; # Must use this before any other WebGUI modules
+use WebGUI::Session;
+
+use WebGUI::Group;
+
+#----------------------------------------------------------------------------
+# Init
+my $session         = WebGUI::Test->session;
+
+
+#----------------------------------------------------------------------------
+# Tests
+
+plan tests => 5;        # Increment this number for each test you create
+
+my $group = WebGUI::Group->new($session, 'new');
+WebGUI::Test->addToCleanup($group);
+$group->scratchFilter("itchy=test_value");
+is( $group->scratchFilter(), "itchy=test_value",'Group->scratchFilter is properly set and retrieved');
+$group->groupCacheTimeout(0);
+is( $group->groupCacheTimeout(), 0, 'set groupCacheTimeout to 0');
+
+$session->user({userId => 1});
+ok( !$session->user->isInGroup($group->getId), 'Visitor is NOT in the group BEFORE scratch value is set'); 
+$session->scratch->set('itchy', 'test_value');
+is ($group->hasScratchUser($session->user->getId), 1, 'Group->hasScratchUser correctly returns 1 immediately after scratch is set');
+
+##Simulate another page view by clearing stow, which is volatile
+$session->stow->deleteAll;
+$session->scratch->delete('itchy');
+is ($group->hasScratchUser($session->user->getId), 0, 'after clearing scratch, user is not in the group any longer');