2022 L&I Cost Of Living Adjustment In Washington State

July 4, 2022


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cost of living adjustment (cola) tax forms and money

What Is An L&I COLA?

An L&I COLA is a Cost of Living Adjustment. Washington state law requires that benefit amounts be recalculated each year to reflect the change in the state’s average wage from the previous year.

The Washington state COLA grew 7.5% at the start of July to $82,508 in 2021, marking the second-largest increase in more than two decades. The 10.1% increase in wages in 2020 was the largest in state history.

The strong demand for workers and hiring challenges across various job sectors drove the sharp increase in average wage growth in 2021. While wages grew in all industry sectors, the greatest increase occurred in those with large numbers of lower-wage workers, including leisure & hospitality (up 14.2%), transportation and warehousing (up 7.6%), and retail trade (up 6.5%).

Because state law requires that workers’ comp benefits administered by the change annually to reflect fluctuations in Washington’s average wage from the prior calendar year, time-loss and pension benefit payments for most workers injured on or before July 1, 2021, will increase by 7.5% in line with a cost of living adjustment (COLA) of the state’s average wage.

As a result, for 2021, the COLA increased the maximum monthly benefit to $8,251, or 120 percent of the state’s average monthly wage.

The monthly increase in workers’ comp payouts also applies to pension benefits paid to the relatives of those who died from a work-related accident or disease. For most workers, these increases became effective July 1, 2022.

However, some workers may not be eligible for the most recent COLA, such as those who also receive federal Social Security benefits. Most workers whose injury date falls between July 1, 2021, and June 30, 2022, will receive their first COLA on July 1, 2023.

Emery Reddy helps workers. Call us for advice on your L&I, workers’ compensation, or other employment law claim. You won’t get better advice.

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