HOUSE BILL REPORT

HB 1117

BYRepresentatives Patrick, Vekich, R. King, Sayan, Winsley and McLean; by request of Department of Labor and Industries

Changing conditions for workers' compensation insurance.

House Committe on Commerce & Labor

Majority Report:  Do pass.  (10)

      Signed by Representatives Vekich, Chair; Cole, Vice Chair; Patrick, Ranking Republican Member; Jones, R. King, Leonard, Prentice, Smith, Walker and Wolfe.

House Staff:Chris Cordes (786-7117)

AS PASSED HOUSE MARCH 2, 1989

BACKGROUND:

The Department of Labor and Industries offers retrospective rating plans for qualified individual employers or groups of employers.  The retrospective rating plan allows adjustment of the employer's premium after the coverage period, based on the claims costs incurred during that period.

To qualify for a group retrospective rating program, the following conditions must be met:  (1) all employers in the retrospective rating group must belong to an organization that has been in existence for at least two years; (2)  the organization must have been formed for a purpose other than obtaining workers' compensation coverage; (3) the occupations or industries of the employers in the organization must be similar; (4) the employers in the retrospective rating group must constitute 50 percent of the total employers in the organization; and (5) the formation of the group program will substantially improve accident prevention and claim management for employers in the group.

SUMMARY:

The requirement is eliminated that the employers in an industrial insurance retrospective rating group constitute at least 50 percent of the total employers in the industry organization sponsoring the retrospective rating group.

Fiscal Note:      Not Requested.

House Committee ‑ Testified For:    Doug Connell, Department of Labor and Industries.

House Committee - Testified Against:      Jeff Johnson, Washington State Labor Council.

House Committee - Testimony For:    Retrospective rating groups provide incentives for employers to promote safety at the workplace.  This bill would make more employers eligible for retrospective rating.

House Committee - Testimony Against:      Expansion of the retrospective rating groups, in conjunction with the expansion of experience rating, will lead more employers to emphasize loss control in their industrial insurance claims management, rather than workplace safety.