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L&I Time-Loss & Wage Replacement Compensation

If you’ve been injured at work and have an open L&I Claim for workers’ compensation benefits, you have the right to L&I time-loss compensation in Washington state, also known as wage replacement benefits.

Time loss compensation and us paper currency

What Is L&I Time-Loss And Wage Replacement Compensation?

Time loss is an L&I benefit offered by the Washington State Department of Labor and Industries (L&I) that pays a percentage of your income to compensate you for loss of pay if a doctor certifies you cannot work due to a workplace injury. Time-loss compensation benefits are not as large as your normal paycheck, but you can expect 60% to 75% of your original compensation, depending on the number of dependents you have.

One thing to note is that the first three days following your injury are considered a waiting period, and you won’t receive your wage replacement for those days until you’ve been out of work for at least 14 days after the injury.

Watch: L&I Basics

Why Is L&I Time-Loss Compensation Important For Washington Workers?

Injured workers in Washington often rely on L&I time-loss compensation because it’s their only safety net, easing the financial burden of their medical expenses and lost income. It may cover injury-related expenses, including hospitalization, follow-up doctor visits, physical therapy, and prescription drugs. For those without health insurance or limited coverage, this additional coverage is critical for their recovery.

Who Is Eligible For L&I Time-Loss And Wage Replacement Compensation in Washington State?

To qualify for wage replacement benefits in Washington state, you must meet several eligibility criteria:

  • You must be an employee, not an independent contractor or a self-employed individual.
  • Your injury or illness must directly result from the duties of your job or the environment you work in.
  • Your doctor must confirm the existence and severity of your injury and provide documentation certifying that you cannot work.
  • You must not be able to work due to your injury—whether it’s temporary or permanent.
  • You must have spent a certain amount of time and earned a minimum amount of money to be eligible, which requirements depend on your claim circumstances. According to L&I, your loss of earnings must be more than 5% of wages at the time of injury.

L&I will consider a worker’s education, experience, training, age, and other determinants of strength as they evaluate the claim. They’ll also account for any permanent loss of function, whether existing or new, resulting from workplace injury. Anyone who is still considered to have the abilities and skills to work and earn a living wage will not likely qualify for benefits.

Even if you meet all of the criteria, you may still be denied benefits, so it’s essential to work with a professional and experienced team of L&I attorneys who can help maximize your chances of getting the compensation you deserve.

How Much Does L&I Pay For Time-Loss?

Time-loss pays 60-75% of a worker’s wage before the injury. The percentage depends on the number of the worker’s dependents and is determined using the LEP calculator or loss of earning power calculator.

If you are already receiving time-loss, it is important to double-check the calculation, as L&I often makes mistakes on wage orders, miscalculates rates, or fails to consider other income sources.

Maximum Time-Loss Rate

In Washington, the maximum L&I time-loss rate for 2023 is $8,250 per month, equivalent to 120% of the state’s average 2020 monthly wage.

Minimum Time-Loss Rate

In 2023, the minimum time-loss rate in Washington is 15% of the average monthly wage plus $10 for the spouse and $10 per dependent for up to five children. This equates to $1,031.35 per month for the worker in addition to the spouse and dependents.

How To Apply For L&I Time-Loss And Wage Replacement Compensation In Washington

In order to ensure your benefits, you need to follow this process as closely as possible as soon as you are injured on the job:

  • Alert your employer and your doctor about the injury or illness and get medical care.
  • File a claim with L&I. You can call, file online, or on paper at the doctor’s office.
  • Verify that you are not working by completing a Work Status Form for L&I.
  • Visit your doctor so they can complete an exam to evaluate your injury and determine your eligibility for benefits. Your doctor will be required to complete certain forms and return them to L&I, which will make the ultimate decision.
  • L&I will consider your claim and make the determination based on your personal circumstances.

Watch: Workers’ Comp Basics And Claims Process

What Documents And Information Do You Need to Provide While Applying?

The amount of documentation required for your case depends on how severe your illness or injury is. In most cases, however, you’ll need to provide details about the injury, your employment history, and the medical treatment you need or are currently receiving. You will likely require the assistance of an attorney experienced in L&I and workers’ compensation to help you collect all the required documentation.

What Is Earning Power?

Earning power is defined by L&I as your ability to earn income at work.

Is L&I Taxable Income?

Time-loss is not taxable. The IRS considers it a disability benefit and not taxable income.

What Benefits Does L&I Time-Loss And Wage Replacement Compensation Offer?

If you are approved for benefits, you may receive compensation for whichever of the following you are eligible for:

  • Lost wages: The money you’ve lost from being unable to work.
  • Medical expenses: The cost of treatment required for your work-related injury.
  • Permanent partial disability: The cost of a permanent disability that keeps you from going back to your previous job responsibilities.
  • Vocational rehabilitation: The cost of learning new skills that will help you find other employment within the workforce.
  • Survivor benefits: Compensation for dependents of a worker who died from a work-related illness or injury.

How Often Is Washington State Time-Loss Compensation Paid?

Time-loss is typically paid twice monthly and requires regular certification by the worker’s medical provider. Your first check will be mailed within two weeks after L&I receives your paperwork from your doctor. Workers that miss a certification will not receive their time loss compensation payment for that period. However, they can seek to receive it as back time-loss if they can obtain and send certification later.

What Is Back Time-Loss Compensation?

Back time-loss simply means time-loss compensation that went unpaid. Back time-loss compensation, if approved, can be paid in lump sum payments to make up for missed payments in the past.

Are There Limitations Or Restrictions Surrounding Time-Loss Compensation?

There are several limits to time-loss benefits to be aware of so you don’t lose access to your compensation.

  • Ongoing medical evaluations: You might be required to obtain regular medical evaluations to determine your ongoing eligibility for time-loss benefits.
  • Look for other jobs: If you still have the ability to work in some capacity, L&I may require you to report your job-hunting efforts.
  • Time limits: For those whose injuries are short-term or temporary, you may only be able to receive benefits for a short period—usually up to one year from the date of the injury.
  • Work restrictions: Your doctor may set work restrictions that must be followed while on time loss. Sometimes, you may not be allowed to work at all or even perform activities that look like work, including house chores, errands, or sports. L&I investigators will seek reasons to accuse you of dishonesty and prosecute you for fraud.
  • Social media: While not an official limitation, it is best practice to avoid posting about your injury on social media to avoid contradictions in your L&I documentation.

What To Do If Your L&I Time-Loss And Wage Replacement Compensation Claim Is Denied

If your time-loss benefits claim has been denied, don’t give up hope. You can still appeal the decision by following this process:

  • Understand the reasons provided in the denial letter.
  • Obtain an L&I attorney who can skillfully navigate the appeals process and help you understand your options.
  • File an appeal within 60 days of the denial—online, in person, or by mail.
  • Attend a hearing and provide evidence and testimony if necessary.
  • Wait for the judge to issue a decision.

You must act quickly to obtain a lawyer if your claim is denied, as there is limited time to prepare evidence and testimony in support of your claim.

How Does Kept-On-Salary (KOS) Work In L&I Claims In Washington State?

L&I offers the Kept-on-Salary (KOS) program to help injured employees obtain prompt, quality medical care and negate the need for time-loss benefits. This voluntary program makes it so that if an injured worker can’t work, their employer can opt to keep them on the payroll while they undergo treatment. It helps eliminate the employee’s strain of lost wages as well as the employer’s administrative burden of time loss compensation in Washington state.

In Washington, here’s how it works:

  • The employee must have a work-related injury that keeps them from working and requires medical care. They must agree to participate in KOS.
  • The worker and employee sign an agreement and submit it to L&I for approval.
  • The employee gets treated by an L&I-approved medical provider, who bills L&I for treatment expenses.
  • The employee continues to receive a paycheck and a portion of their benefits while they are being treated for their injury.
  • L&I monitors progress.

Work with an attorney to determine if this might be the correct route for you.

Employer Misuse Of The Kept-On-Salary Incentive

Unfortunately, some employers have been known to abuse the program by not paying time-loss compensation or pressuring injured workers to return to work before they are healed. This not only risks the employee’s health but may also violate their workers’ compensation rights. Some employers even use the KOS program to commit fraud to falsify records, making it appear that a worker is receiving their salary when they are not.

If you believe your employer is abusing the KOS program or violating your rights, consult with an attorney so you can take legal action to protect your interests.

Do I Need A Lawyer To Collect Time Loss Compensation In Washington State?

If you believe you are entitled to wage replacement, or you are owed back time- loss that you were never rightfully paid, call the legal team at Emery | Reddy, PLLC to discuss your options. Learn more about how we can advise you about your options regarding wage replacement benefits. Please remember to have your L&I claim number readily available.

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