Employment Law Blog

News, trends and analysis in employment law and HR

Sep 24, 2015

WASHINGTON: L&I proposes 2016 workers’ comp rate increase

Safety and HealthWorkers’ Comp 

The Washington State Department of Labor & Industries (L&I) has just announced a proposed 2% average base rate increase for 2016 workers’ compensation coverage.

The Washington State Department of Labor & Industries (L&I) has just announced a proposed 2% average base rate increase for 2016 workers’ compensation coverage. Proposed rates are based on several factors, including expected claim costs, the size of the contingency fund, and the inflation of wages. Of note, companies involved in miscellaneous wood products manufacturing are seeing a proposed increase of 5% on their base rate, while sawmills and machine shops are both proposed to increase by 2%. View L&I’s Rates for Workers' Compensation for detail about the proposed rates for each risk classification. 

What we know now is that this rate increase is nearly double what L&I needs to break even. Oregon has just announced a reduction of 5.3% on average for their base rates in 2016 for the third straight year. They cite stable costs for lost wages and lower average medical care costs for driving a decrease in the pure premium.

Nancy Dicus, Vigilant’s VP of Operations, sits on L&I’s Workers’ Comp Advisory Committee and will be attending the meeting on September 25, 2015, to learn more about what’s behind the increase. 

This was included in L&I’s rate announcement:

“When workers’ compensation rates are like a roller coaster ride, it frustrates everyone. We’re not going to do that. I’m committed to keeping rates steady and predictable,” said L&I Director Joel Sacks. “We’ve worked hard to decrease the costs of running the program, which is one of the reasons we can propose a rate increase that’s well under the wage inflation rate. Still, this small increase will help build the reserve funds needed to keep our program financially healthy.”

L&I will hold a series of public hearings where people can learn about and comment on the proposed rates. The hearings are scheduled for: 

  • Tumwater, Oct. 26, 10 a.m., Dept. of Labor & Industries Auditorium.
  • Vancouver, WA, Oct. 26, 10 a.m., NW Regional Training Center.
  • Tukwila, Oct. 27, 10 a.m., Tukwila Community Center.
  • Everett, Oct. 28, 10 a.m., Everett Community College.
  • Spokane, Oct. 29, 9 a.m., Spokane CenterPlace.
  • Richland, Oct. 30, 9 a.m., Richland Community Center.

Tips: While the setting of rates is something that employers in Washington can’t control, we can control the way we prevent and manage losses. Through the Vigilant retrospective rating program we are able to help companies in Washington prevent injuries and manage claim-related losses, all while offering employers the opportunity to earn refunds on the workers’ comp premiums paid to L&I. Looking for more information about retrospective rating or Vigilant’s Retro program? Please visit our website or contact Trish Leimbach, Workers’ Comp Director, at 800-733-8620.

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