L&I proposes small decrease in workers’ comp premium rates

The price of workers’ compensation insurance in Washington would drop for the third year in a row under a proposal by L&I. L&I proposed a 0.8% decrease in the average premium that employers would pay for the coverage in 2020. For the many construction risk classifications, the proposed rates range from a 17% decrease for asphalt paving or surfacing, NOC, to a 10% increase for dam construction.

Click here to view the proposed rates by classification.

AGC welcomes the proposed decrease and the successes in helping injured workers heal and return to work that they reflect. However, AGC also believes the proposed decrease could have been more had there not been raids on the workers’ comp accounts, known as 608 and 609 in the state budget.

“The department continues to fund non-workers’ compensation programs using workers’ compensation funds,” said AGC Chief Lobbyist Jerry VanderWood. “These are funds are paid for predominately by employers to be held for the benefit of future injured workers. Diverting their use to non-workers’ compensation purposes simply acts as an undeclared tax on employers.”

Some non-workers’-compensation programs at L&I have been funded out of 608/609 premiums beginning with the 2003 and subsequent operating budgets, while the funding was changed from the General Fund to 608/609 for the staffing and administration of some programs such as the Department’s regulation of apprenticeship and employment law.

AGC notes that there have been similar raids or attempted raids occurring in other states in recent years – Montana, New York, Oregon – and each time they result in protracted legal and legislative disputes between premium payers and the state.

“We do not want to see this trend extend to Washington,” VanderWood said. “These proposed programs, while perhaps meritorious, have nothing to do with the risk management, adjudication, and payment of workers’ compensation benefits, which is and should be the only proper purpose of the Accident and Medical Aid Funds. Accordingly, they should not be paid for with them. We call upon the department to stop the diversion of workers compensation trust funds.”

L&I says the proposed 0.8% decrease would mean Washington employers, as a group, pay a total of $21 million less in premiums.

The price drop would result in employers paying an average of about $15 less a year per employee for workers’ compensation coverage. Employees would see a very small increase in the amount they pay because of a rise in costs related to the supplemental pension fund, due to an increase in the average wage in Washington. The supplemental pension fund supports cost-of-living adjustments for long-term time-loss and pension benefits.

Everyone will have an opportunity to comment on the 2020 proposed rates at three public hearings:

Tukwila -- Oct. 29, 10 a.m., Dept. of Labor & Industries Tukwila Office
Spokane Valley -- Oct. 30, 9 a.m., Spokane CenterPlace
Tumwater -- Nov. 1, 10 a.m., Tumwater Labor & Industries Office

People can also comment in writing to Jo Anne Attwood, administrative regulations analyst, P.O. Box 41448, Olympia WA 98504-4148; or via email. All comments must be received by 5 p.m. on Nov. 5, 2019.

More information about the proposal is available at www.Lni.wa.gov/Rates. Final rates will be adopted by early December and go into effect Jan. 1, 2020.