SENATE BILL REPORT

SHB 400

BYHouse Committee on Commerce & Labor (originally sponsored by Representatives Wang, R. King, Patrick, Chandler, Cole and Winsley; by request of Joint Select Committee on Industrial Insurance and Department of Labor and Industries)

Changing rates for industrial insurance disability benefits.

House Committe on Commerce & Labor

Senate Committee on Commerce & Labor

Senate Hearing Date(s):March 23, 1987; March 25, 1987

Majority Report:  Do pass.

      Signed by Senators Warnke, Chairman; Smitherman, Vice Chairman; Tanner, Vognild, Williams, Wojahn.

Senate Staff:Dave Cheal (786-7576)

                  March 25, 1987

AS REPORTED BY COMMITTEE ON COMMERCE & LABOR, MARCH 25, 1987

BACKGROUND:

The amount of basic workers' compensation disability and death benefits paid monthly to workers or beneficiaries is based on a schedule that varies depending on the marital status of the worker and the number of children.  The amount is limited by statute to 75 percent of the state average monthly wage.  Minimum amounts are also established in the dependent schedule.

The disability benefits received by an injured worker are based on the worker's monthly wages at the time of injury.  The law excludes tips, as well as overtime pay and gratuities, from the calculation of the worker's monthly wages.

Compensation for an occupational disease claim is based on the payment schedule that was in effect at the time the worker contracted the disease.  Many occupational diseases do not manifest themselves for many years after the date that they were actually contracted.

If a worker receives a permanent partial disability award based on a back injury that does not have marked objective clinical findings, the award is automatically reduced by 25 percent.

SUMMARY:

The schedule is deleted that bases disability and death benefit payments on the number of dependents of the injured worker.  The basic disability or death benefit monthly payment to an injured worker or surviving spouse is established at 66-2/3 percent of the injured worker's wages at the time of injury.  The maximum monthly benefit payable is increased from 75 percent to 100 percent of the state average monthly wage. The schedule for minimum benefit amounts is deleted.

References to compensation payable for children are removed, in conformity with the deletion of the dependent schedule.  The lien authority of the Department of Social and Health Services is amended to conform with the dependent schedule changes for purposes of child support enforcement.  It is clarified that death benefit payments made on behalf of a child of a deceased worker are to be made to the person having legal custody of the child.

The definition of "wages" on which to compute an injured worker's industrial insurance benefits is amended to include tips reported to the employer for federal income tax purposes.  Board, housing, fuel and other similar considerations are included in the definition of wages if received from the employer as part of the contract of hire.

The rate of compensation for occupational disease claims filed on or after July 1, 1987, is established as of the date that the disease requires medical treatment or becomes disabling, whichever occurs first, without regard to the date on which the disease was contracted or the date the claim was filed.

The reduction in the permanent partial disability award is deleted for back injuries that do not have marked objective clinical findings.

Fiscal Note:      requested

Senate Committee - Testified: Cindy Zehnder, Teamsters; Bob Dilger, Washington State Building Trades Council; Cliff Finch, Association of Washington Business; Holly Mankee White, Mankee Lumber Company; Joe Dear, Department of Labor and Industries; Sharon Hanson, City of Everett; Jeff Johnson, Washington State Labor Council; Joe Albo, Washington State Trial Lawyers; John Winney, IWAC; Sue Smith, Consolidated Freightways