Workers’-comp rates to remain flat on average; AGC pushes for reforms

Workers’-comp rates to remain flat on average; AGC pushes for reforms

L&I is proposing no increase in the average rate employers pay for workers’-compensation insurance in 2021. If the proposal is adopted, this will be the first time in 20 years that workers’ compensation rates have dropped or stayed steady for four years in a row. 

As always, proposed rates for individual construction classifications vary greatly and while the vast majority decreased between 1% to 12%, a few increased. Proposed rates for all risk classifications can be found here.

“Our 2021 rate proposal recognizes the toll the pandemic is taking on employers and workers in our state,” L&I Director Joel Sacks said. “Although our projected workers’ compensation costs are going up, we’re keeping premiums the same by taking advantage of the reserves we’ve built over the years by improving services and reducing disability.”

While AGC welcomes the overall lack of increase in workers’ comp rates, it also points out that rates could be even lower if the Legislature adopted reforms supported by AGC. These include addressing the use of the state’s average annual wage calculated by the Employment Security Department. The increase in average wage drives mid-year inflationary increases in a number of social insurance programs including workers comp. Using the average wage rather than an alternative measure of cost of living Increases the annual COLA for workers’ comp timeloss and pensions well beyond common cost-of-living measures. Premiums paid by employers (and workers for State Fund) for the Supplemental Pension Fund component of workers’ comp will increase 12% in 2021, a significant increase compared to general inflation which is currently less than 2%.

AGC will continue to advocate for fair and accurate benefits within the workers’ compensation system, clearer definition of what constitutes an occupational disease, and for the elimination of age restrictions on claim settlements.

More information about the proposal and public comment opportunities is available at www.Lni.wa.gov/2021Rates.

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