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June 26, 2009

Workers' compensation benefits to increase 3.432 percent

OLYMPIA – Workers currently receiving Washington workers’ compensation wage-replacement or pension benefits will receive a 3.432 percent cost-of-living increase effective Wednesday, July 1. State law requires that benefits be recalculated each year to reflect the change in the state’s average wage from the previous calendar year.

Also increasing will be the amount the Department of Labor and Industries (L&I) pays for a permanent partial disability (PPD). That annual increase is based on the change in the Consumer Price Index. Effective Wednesday, PPD awards will rise 4.09 percent for workplace injuries incurred July 1 and beyond. PPD awards go to workers who have lost a body part or suffered a permanent, disabling injury.

Under Washington’s workers’ compensation system, injured workers receive from 60 to 75 percent of their income, up to the legally set maximum, tax free, while they are off the job and recovering. The percentage of income is based on their marital status and number of dependents. For workers injured in 2008, the average monthly time-loss paid was about $1,890.

The recalculation of benefits is based on the average annual wage of all workers in Washington. That wage, calculated by the Employment Security Department, rose to $46,256 in 2008, an increase of 3.432 percent from 2007.

As a result, the new maximum monthly benefit will be $4,625, or 120 percent of the state’s average monthly wage, for workers injured after June 30, 1996. Less than 4 percent of L&I claimants receiving wage-replacement benefits collect the maximum.

Maximum benefits differ depending on when an injury occurred because, in 1996, the state Legislature increased the percentage of the state’s average wage used to set the maximum benefit level.

Time-loss payments 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 and 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.

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For media information: Tiffany Scheer, L&I, 360-902-6043, or scti235@Lni.wa.gov

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