WORKERS COMPENSATION RATE INCREASE

The Washington State Department of Labor & Industries (L&I) is proposing a 4.9 percent rise in the average hourly rate employers and workers pay for workers’ compensation insurance in 2026.  The increase would help pay for the rising cost of providing benefits when a worker is injured on the job. The proposed increase is less than what L&I projects it will need to cover 2026 claim costs. As it has done in past years, the agency plans to use the workers’ compensation contingency reserve to cover the difference.

If adopted, the increase would raise the cost of coverage by about $1.37 a week per full-time employee, on average. Employers pay about 75 percent of the premium, and workers pay about 25 percent.

By maintaining a healthy contingency reserve through consistent, careful management of the premiums paid by workers and employers, L&I can cover some of the costs instead of passing higher premium increases on to employers and workers.  Without the reserve, rates could go up nearly 13 percent to cover expected 2026 claims costs.

Employers and workers typically pay into Washington state’s workers’ compensation system to cover wage and disability benefits and medical costs for work-related injuries and illnesses.

In many states, rates are charged as a percentage of payroll. When wages go up, those states automatically collect more in premiums without raising rates. Washington bases workers’ compensation premiums on hours worked. So, when wages go up, the employer and worker contributions stay the same. That’s why when wages and medical costs climb in Washington, L&I sometimes has to raise rates to keep up.

Public Hearings Planned

People in Washington have opportunities to provide input before L&I makes a final decision on workers’ compensation rates. Public hearings are scheduled for October 28 and 29, 2025 and a virtual-only public hearing is scheduled for October 30, 2025.

10:00 a.m. on October 28, 2025
L&I Headquarters, Rooms S117, S118, and S119
7273 Linderson Way SW
Tumwater, Washington

9:00 a.m. on October 29, 2025
CenterPlace Event Center, Meeting Room
2426 Discover Place
Spokane Valley, Washington

10:00 a.m. on October 30, 2025 (virtual only)
Join electronically: https://lni-wa-gov.zoom.us/j/4283482697?omn=85288279946
Meeting ID: 428 348 2697

Final rates will be adopted on November 26, 2025 and go into effect January 1, 2026.

Workers’ comp facts:

• L&I workers’ compensation insurance covers about 2.8 million workers and about 201,000 employers in Washington.
• The proposed rate is an average. An individual employer’s actual rate change may be more or less depending on that employer’s industry and history of claims that result in wage replacement and/or disability benefits.