The Department of Labor & Industries has proposed raising 2012 industrial insurance (L &I) rates by an average of 2.5%. Despite actuarial analysis that indicates a 0% rate increase would be necessary to maintain the solvency of the state fund, L&I Director Judy Schurke has decided that a 2.5% increase, although unnecessary, is needed to rebuild L&I’s contingency reserve fund.

L&I’s press release astonishingly spins the nice-to-have, but unnecessary rate increase as follows:

“To help save jobs in the state’s struggling economy, L&I is proposing a 2.5% average increage.”

L&I admitted that the workers’ compensation reforms passed at the urging of the business community during this year’s legislative session had negated the need for increased rates in 2012. Incredibly, L&I is proposing to raise rates anyway, at the worst possible time for businesses and workers.

If you would like to comment on L&I’s proposed 2012 rate increase before it is officially adopted, you can testify at at one of the following public hearings:

Vancouver, October 25th at 9am - Red Lion Hotel, Vancouver at the Quay Tukwila, October 26th at 1pm - L&I Office

Below are some talking points that members can use:

• Clearly, now is not the time to saddle struggling small businesses with additional costs that are not necessary to maintain health of the L&I State Fund.
• Reserves should be built up during good economic times for use in bad times, not the reverse.
• Average rate increase for construction companies (the worst-hit industry in the state) is 6%, not 2.5%. According to L&I’s own researcher, Kirsta Glenn, Construction employment is expected to grow at about half the rate as total employment in 2012 - a 6% rate increase will only make this situation worse.
• According to L&I’s own statistics, new L&I claims from the construction industry are down 16.45 versus 2007-09, yet we still need a 6% rate increase?

These talking points are only guidelines and meant to provide information that members can use in creating their own testimony. Without exception, the most compelling testimony comes from members’ own personal stories and experiences; no one know the effects that L&I rate increases will have on your business like you do.

The hearings are your opportunity to let someone in charge at L&I know the true impact of their decisions.

Legislation passed this session of the legislature (2011) and signed by Governor Gregoire authorized Labor and Industries (L&I) to create a new “Stay at Work” incentive program for injured employees and their employers. The “Stay at Work” program is effective June 15, 2011 and reimburses employers for up to 50 percent of the wages they pay to their workers who have been injured on the job but are not able to return to their regular job. The maximum wage reimbursement is $10,000 and cannot exceed more than 66 days worked in a consecutive 24 month period. To qualify for the reimbursement the injured employee must be restricted by his or her attending physician from returning to their regular job during the period you are seeking reimbursement. The attending physician also has to release the injured employee to the modified work that their employer has available. All of this must be in writing so this is one of those areas where you need to make sure you have crossed your T’s and dotted your I’s.

Besides reimbursing for wages the new “Stay at Work” program will also reimburse for:

• Special clothing your worker needs to do the job—up to $400.
• Tools purchased for the transitional modified-duty job—up to $2,500.
• Instruction that would require the cost of tuition, books or materials to prepare the worker for the job—up to $1,000.

These are costs separate from the $10,000 gross wages available for reimbursement. Your total reimbursement could be $13,900!!

Paying an injured worker his full wages while in a transitional modified duty position is a simple cost effective way of controlling the premiums you pay to L&I. Controlling your claims cost can also mean higher retro refunds from the ROII program. In the past small and medium sized companies may have struggled with paying full or even partial wages while an employee was on modified duty work. Now ALL companies regardless of size can take advantage of this cost effective strategy and get a partial reimbursement for wages paid.

To get reimbursed from the ‘Stay at Work Program’ you must submit an application requesting reimbursement. It is anticipated that these applications will be available on L&I’s web site effective September 1, 2011. You must create and save the following documentation:

• Documentation - You must keep documentation from the employee’s health care provider showing that they are unable to return to their regular job at the time of injury, that they have been released for modified work, and that the employee’s physician has approved the modified work that you have available and is within your employee’s current restrictions. All of this must be in writing!
• Modified duty job offer—You must communicate the modified duty job offer in writing to your injured employee and the employee must accept the modified duty work.
• Payroll records—You must keep detailed time and payroll records that establish the hours that your injured employee performed the modified work and how much they earned for this work.
• Receipts—You must keep receipts for tools, clothing and instruction you wish to get reimbursed for.