Wash. Workers’ Comp Benefits See an Increase of 0.6%

Workers currently receiving Washington workers’ compensation time-loss or pension benefits will receive a 0.6 percent cost-of-living increase effective immediately.

State law requires that maximum time-loss benefits and pensions be recalculated each July 1 to reflect the change in the state’s average wage from the previous calendar year.

Under Washington’s system, injured workers receive from 60 to 75 percent of their income, tax free, while they are off the job and recovering. The percentage of income is based on the number of dependents. In 2004, the average monthly time-loss paid to injured workers was just under $1,700.

The annual recalculation of time-loss and pension benefits is based on the average annual wage of all workers in Washington. That wage – set by the Employment Security Department – rose to $39,038 in 2004, an increase of 0.6 percent from $38,794 in 2003.

As a result, the new maximum benefit will be $3,903.80, or 120 percent of the state’s average monthly wage, for workers injured after June 30, 1996. Only 3.5 percent of L&I claimants typically receive the maximum dollar amount. Without the restriction, there would be no limit on the amount high-income workers, injured on the job, could collect in benefits.

Maximum benefits differ depending on when an injury occurred because, over the past decade, the state Legislature has increased the percentage of the state’s average wage used to set the maximum benefit level.

Time-loss benefits partially compensate workers for lost wages due to a job-related injury or illness. Pension benefits are paid when a work-related injury or illness causes a worker to be totally permanently disabled. Pensions also are paid to a worker’s surviving spouse and dependent children when a workplace accident or illness results in death.

The July 1 increase applies to both State Fund and self-insured employers. Labor and Industries manages the State Fund, which insures about 1.9 million workers for 160,000 employers. Another 800,000 workers are employed by companies that self-insure.