5 Biggest Changes to Washington State L&I in 2024-2025

Brace yourselves for the latest developments in Washington State’s Labor & Industries (L&I) Cost of Living Adjustment (COLA) for 2024-2025. This crucial update pertains to all workers receiving L&I benefits, shaping their financial well-being for the upcoming year. The newly determined COLA reflects the continuous efforts of L&I to ensure that injured workers’ benefits keep pace with rising living costs.

The COLA calculation meticulously considers the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), a widely recognized gauge of inflation. The CPI-W accurately captures changes in the prices of goods and services that are essential to everyday living. By aligning L&I benefits with the CPI-W, the state aims to preserve the purchasing power of injured workers, mitigating the impact of inflation on their livelihoods.

The upcoming COLA adjustment reflects the economic climate and the rising cost of essential expenses. Recognizing the financial challenges faced by injured workers, L&I remains committed to providing fair and adequate benefits that meet their needs. This COLA update serves as a testament to the state’s ongoing support for its injured workers, ensuring that they receive the necessary compensation and assistance as they navigate their recovery journey.

The Impact of L&I COLA on Washington Workers

The Importance of L&I COLA for Injured Workers

The Labor and Industries (L&I) cost-of-living adjustment (COLA) plays a critical role in ensuring that injured workers in Washington state maintain a reasonable standard of living. The COLA is a yearly adjustment to the workers’ compensation benefits that considers changes in the cost of living, ensuring fair and adequate compensation for those who have suffered injuries on the job. This adjustment helps to offset the rising costs of basic necessities like food, housing, and healthcare, enabling injured workers to focus on their recovery without the added burden of financial hardship.

The L&I COLA is calculated based on the Consumer Price Index (CPI), a measure of inflation and changes in the cost of living. By linking the adjustment to the CPI, the COLA ensures that benefits keep pace with rising prices, which would otherwise erode their value over time.

The COLA adjustment is a vital safety net for injured workers who may be unable to return to work due to their injuries. By providing ongoing financial support, the COLA helps these workers meet their basic needs and focus on their rehabilitation without sacrificing their quality of life.

Calculating the L&I COLA

The L&I COLA is determined by comparing the current CPI with the CPI from the previous year. If the CPI has increased, the COLA will be equal to the percentage change in the CPI. For example, if the CPI increases by 5% from one year to the next, the COLA will be 5%.

The COLA is applied to various workers’ compensation benefits, including monthly wage replacement payments, permanent partial disability benefits, and medical treatment costs.

Example of COLA Calculation

| Year | CPI | Change | COLA |
|—|—|—|—|
| 2023 | 100 | – | – |
| 2024 | 105 | +5% | +5% |

In this example, the CPI increased by 5% from 2023 to 2024, resulting in a COLA of 5% for 2024.

Historical Overview of the L&I COLA Program

The Labor & Industries (L&I) Cost-of-Living Adjustment (COLA) was established in 1982 as a way to help Washington state workers keep pace with rising living costs.

Historical COLA Adjustments

The COLA adjustment is based on the U.S. Bureau of Labor Statistics’ Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).

The following table shows the historical COLA adjustments that have been made to Washington state workers’ benefits:

Comparison to Other States and National Cost of Living Adjustments

Washington State L&I COLA

The Washington State Department of Labor & Industries (L&I) cost-of-living adjustment (COLA) for 2024-2025 is 2.8%. This increase is based on the change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for the Seattle-Tacoma-Bellevue metropolitan area from September 2023 to September 2024.

Comparison to Other States

The Washington State L&I COLA is comparable to the COLAs in other states in the region. For example, the Oregon Department of Consumer and Business Services has set the COLA for 2024-2025 at 2.9%, and the California Department of Industrial Relations has set the COLA at 3.0%.

Comparison to National Cost of Living Adjustments

The Washington State L&I COLA is slightly lower than the national COLA for 2024-2025, which is 3.0%. However, it should be noted that the national COLA is a weighted average of the COLAs in all 50 states and the District of Columbia. As a result, the national COLA may not be representative of the cost of living in all areas of the country.

Additional Information

The Washington State L&I COLA is used to adjust the benefits of injured workers who are receiving workers’ compensation benefits. The COLA is also used to adjust the maximum weekly benefit rate for workers who are injured on or after January 1, 2025 and all supplementary pension benefits payable under Chapter 51.32 RCW.

Table of COLA Rates

The following table shows the COLA rates for Washington State L&I benefits for the past 10 years:

Year	COLA Adjustment
1983	1.7%
1984	3.5%
1985	3.1%
1986	1.3%
1987	4.2%
1988	4.8%
1989	5.3%
1990	5.4%
1991	3.6%
1992	3.1%
1993	2.6%
1994	2.8%
1995	2.6%
1996	3.0%
1997	2.9%
1998	1.9%
1999	2.3%
2000	3.4%
2001	2.6%
2002	1.3%
2003	2.1%
2004	2.7%
2005	3.1%
2006	2.9%
2007	3.1%
2008	5.1%
2009	-0.6%
2010	0.0%
2011	0.0%
2012	1.1%
2013	1.4%
2014	1.2%
2015	1.0%
2016	0.9%
2017	1.2%

Year

COLA Rate

2014-2015

1.3%

2015-2016

1.1%

2016-2017

0.5%

2017-2018

1.2%

2018-2019

2.4%

2019-2020

2.1%

2020-2021

1.9%

2021-2022

5.1%

2022-2023

2.5%

2023-2024

2.8%

The L&I COLA and Its Role in Supporting Workers’ Wages

The Labor & Industries (L&I) cost-of-living adjustment (COLA) is a crucial component of Washington State’s workers’ compensation system. Its primary function is to ensure that workers’ wages keep pace with inflation and maintain their purchasing power.

Benefits of the L&I COLA

Preserves Purchasing Power: The COLA adjusts wages to offset inflation, protecting workers from a decline in their purchasing power.
Encourages Reporting of Injuries: Adequate compensation through the COLA encourages injured workers to report their injuries promptly, leading to better outcomes.
Promotes Economic Stability: Increased spending by workers receiving COLA payments stimulates the local economy, fostering economic growth.

How the L&I COLA is Determined

The L&I COLA is calculated annually based on the Consumer Price Index (CPI) for Urban Wage Earners and Clerical Workers (CPI-W). The CPI-W measures the change in the prices of a basket of goods and services commonly purchased by this population.

If the CPI-W increases by 2% or more from the previous year, the L&I COLA is triggered. The adjustment is equal to 50% of the CPI-W increase that exceeds 2%.

Historical L&I COLA Rates

Year	CPI-W Increase	L&I COLA Rate
2023	7.7%	2.75%
2022	7.0%	2.50%
2021	4.9%	1.45%
2020	1.2%	0.60%

Impact on Injured Workers

The L&I COLA directly benefits injured workers who are receiving workers’ compensation benefits. It ensures that their wages, and therefore their standard of living, are not negatively affected by inflation.

For example, if an injured worker’s wages were $60,000 in 2023, and the CPI-W increased by 5% in 2024, they would receive an L&I COLA of 1.5%, resulting in adjusted wages of $61,500.

Conclusion

The L&I COLA plays a vital role in supporting the wages of injured workers in Washington State. By adjusting wages to keep pace with inflation, it preserves their purchasing power, encourages reporting of injuries, and contributes to economic stability.

Future Projections for the L&I COLA in Washington State

1. Factors Influencing COLA Adjustments

Several factors impact COLA adjustments, including the Consumer Price Index (CPI), which measures inflation. Other factors include economic growth, wage increases, and changes in the cost of living.

2. Historical COLA Adjustments

In recent years, Washington State’s L&I COLA has varied from 1.3% to 3.8%. These adjustments have helped maintain the purchasing power of L&I benefits for injured workers.

3. Projected COLA Adjustments for 2024-2025

Future COLA adjustments are determined based on economic forecasts and CPI projections. According to the Washington State Office of Financial Management, the projected COLA adjustments for 2024-2025 are as follows:

Year	Projected COLA Adjustment
2024	3.2%
2025	2.9%

4. Impact of COLA Adjustments on Injured Workers

COLA adjustments play a crucial role in ensuring that injured workers receive fair compensation for their lost wages and medical expenses. These adjustments help maintain the purchasing power of L&I benefits over time.

5. Monitoring COLA Adjustments

The Washington State Department of Labor & Industries (L&I) regularly reviews and adjusts the COLA to ensure that it remains appropriate given economic conditions.

6. Implications for Employers

COLA adjustments can impact employers’ L&I premiums. Employers should monitor COLA projections to plan for potential increases in their premiums.

7. Additional Factors to Consider

Other factors that may influence COLA adjustments include changes in federal policies, natural disasters, and global economic events.

8. Role of the L&I COLA Advisory Board

The L&I COLA Advisory Board provides input and recommendations to L&I regarding COLA adjustments. The board is composed of representatives from labor, business, and the general public.

Case Studies and Real-World Impacts of the 2024-2025 L&I COLA

1. Increased Benefits for Injured Workers:
The COLA will result in higher weekly benefits for injured workers receiving permanent partial disability awards, as well as for survivors receiving death benefits.

2. Enhanced Medical Coverage:
The COLA will also increase the reimbursement rates for medical treatments, ensuring that injured workers have access to quality healthcare.

3. Improved Stability for Families:
Increased workers’ compensation benefits provide financial stability for injured workers and their families during a time of need.

4. Reduced Reliance on Public Assistance:
The COLA helps reduce the need for injured workers to rely on public assistance programs, freeing up resources for other essential services.

5. Enhanced Employer Compliance:
The COLA encourages employers to prioritize workplace safety measures to avoid costly workers’ compensation claims.

6. Positive Economic Impact:
Increased workers’ compensation benefits stimulate the local economy by supporting medical facilities and other businesses.

7. Data Analysis and Research:
The COLA provides valuable data for policymakers to analyze the impact of workplace injuries on individuals and the economy.

8. Increased Awareness of Workplace Safety:
The COLA raises awareness of the importance of workplace safety and encourages employers to invest in injury prevention programs.

9. Reduced Insurance Premiums:
Employers with a good safety record may qualify for reduced workers’ compensation insurance premiums.

10. Earnings and Benefits Adjustment:
The COLA adjusts workers’ earnings and benefits to keep pace with inflation, ensuring that injured workers receive fair compensation for their injuries.

Benefit Type	COLA Adjustment
Permanent Partial Disability	2.7%
Death Benefits	2.7%
Medical Reimbursement Rates	2.7%

Washington State L&I COLA 2024-2025

The Washington State Department of Labor & Industries (L&I) has announced the 2024-2025 cost-of-living adjustment (COLA) for workers’ compensation benefits. The COLA is based on the change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from June 2023 to June 2024.

The CPI-W increased by 8.7% during that period, resulting in a COLA of 8.7% for workers’ compensation benefits. This means that workers’ compensation benefits will increase by 8.7% effective October 1, 2024.

The COLA will apply to all workers’ compensation benefits, including:

Temporary total disability benefits
Permanent partial disability benefits
Permanent total disability benefits
Death benefits