HOUSE BILL REPORT

SB 6354

BYSenators Lee, Smitherman and McMullen; by request of Department of Labor and Industries

Changing the definition of wages for industrial insurance purposes.

House Committe on Commerce & Labor

Majority Report:  Do pass with amendments.  (11)

      Signed by Representatives Wang, Chair; Cole, Vice Chair; Fisher, Jones, R. King, O'Brien, Patrick, Sanders, Sayan, C. Smith and Walker.

House Staff:Chris Cordes (786-7117)

AS PASSED HOUSE MARCH 3, 1988

BACKGROUND:

Under Washington's industrial insurance system, 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.

SUMMARY:

The definition of "wages" for the purpose of determining the monthly wages on which to compute an injured worker's industrial insurance benefits is amended to include tips, to the extent that tips are reported to the employer for federal income tax purposes. The inclusion of board, housing, fuel and other similar consideration in the definition of wages is clarified by adding that these must be received from the employer as part of the contract of hire.

Fiscal Note:      Requested February 25, 1988.

Effective Date:The bill takes effect January 1, 1989.

House Committee ‑ Testified For:    Betty Buckley, Department of Labor and Industries; and Bob Seeber, Restaurant Association of Washington and the Washington State Lodging Association.

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    Since industrial insurance benefits are intended to replace an injured worker's income during the recovery period, tips should be included in the calculation of wages for benefit determinations.

House Committee - Testimony Against:      None Presented.