Yesterday, the Washington Department of Labor & Industries announced that the recent reforms signed into law by Governor Gregoire in May and covered extensively in this Blog were on track to save the state $1.1 billion and even allow the L & I system to break even as early at 2012. Despite this, L & I also wants to raise rates by 3.5 percent to bulk up the reserves that support the system.
This proposal was announced by Labor & Industries Director Judy Schurke at a briefing for the Workers’ Compensation Advisory Committee. News like this tends to make business groups nervous as they tend to argue that any rate increase will directly affect their ability to hire in this shaky economy.
However, noting how the recession deeply impacted the workers’ compensation system reserves, Schurke insisted the rate increase was necessary. She noted, “It’s critical that we restore the workers’ comp reserves. Savings from the reforms create an opportunity to do this without large rate increases,” Shurke noted.
Kris Trefft, general counsel for the Association of Washington Business, countered “On the one hand I understand what they are saying. On the other hand I can’t believe now is a good time to raise rates when the department’s own data shows they don’t have to because of these…reforms.”
However, Labor Advocate Kathy Cummings released a statement saying “We think that restoring the reserves is the responsible choice…Employers have strong financial incentive to aggressively market these lump-sum buyouts, but it’s anybody’s guess how often workers will sign on the dotted line.”
The Department of Labor & Industry will announce proposed rates on September 20 and public hearings will be held in October. Whatever the outcome, it’s clear that the struggle over reforming Washington’s workers’ compensation system is far from over.
If you are an injured worker preparing to file a claim, be sure to contact an experienced Washington Workers’ Compensation Lawyer at Emery Reddy today.