Washington’s Department of Labor and Industries has announced that beginning July 1, and over the next six months, employers and workers in the state will save an estimated $315 million in workers’ compensation premiums thanks to a partial rate holiday.
The rate holiday means that most Washington employers will deduct much less from their employees’ paychecks for workers’ compensation premiums. In hazardous industries such as construction, manufacturing and agriculture, the savings for employers and workers will be considerable, L&I said.
The six-month reduction in workers’ compensation premiums was proposed by Gov. Chris Gregoire late last year and adopted by the L&I in March.
“In the global economy in which we compete, we need to do everything we can to create and retain family wage jobs by recruiting businesses to our state and helping existing businesses to expand,” said Gov. Gregoire. “The rate holiday will help businesses, and will also put money into the pockets of workers.”
For work performed from July 1 through Dec. 31, employers and workers will not pay the Medical Aid Fund premium. L&I will pay that premium for them from excess reserves that have accumulated in that fund.
On average, the savings will represent about 34 percent of total premiums paid into the workers’ compensation system for work performed in the second half of the year, L&I said. Because employers and workers pay equally into the Medical Aid Fund, both will benefit equally.
The rate holiday is temporary and will end Jan. 1, 2008.
All Washington employers have been sent new rate notices that explain exactly how much they will save during the six-month rate holiday. More information is available at www.RateHoliday.LNI.wa.gov.
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