Brace yourselves for the latest developments in Washington State’s Labor & Industries (L&I) Cost of Living Adjustment (COLA) for 2024-2025. This crucial update pertains to all workers receiving L&I benefits, shaping their financial well-being for the upcoming year. The newly determined COLA reflects the continuous efforts of L&I to ensure that injured workers’ benefits keep pace with rising living costs.
The COLA calculation meticulously considers the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), a widely recognized gauge of inflation. The CPI-W accurately captures changes in the prices of goods and services that are essential to everyday living. By aligning L&I benefits with the CPI-W, the state aims to preserve the purchasing power of injured workers, mitigating the impact of inflation on their livelihoods.
The upcoming COLA adjustment reflects the economic climate and the rising cost of essential expenses. Recognizing the financial challenges faced by injured workers, L&I remains committed to providing fair and adequate benefits that meet their needs. This COLA update serves as a testament to the state’s ongoing support for its injured workers, ensuring that they receive the necessary compensation and assistance as they navigate their recovery journey.
The Impact of L&I COLA on Washington Workers
The Importance of L&I COLA for Injured Workers
The Labor and Industries (L&I) cost-of-living adjustment (COLA) plays a critical role in ensuring that injured workers in Washington state maintain a reasonable standard of living. The COLA is a yearly adjustment to the workers’ compensation benefits that considers changes in the cost of living, ensuring fair and adequate compensation for those who have suffered injuries on the job. This adjustment helps to offset the rising costs of basic necessities like food, housing, and healthcare, enabling injured workers to focus on their recovery without the added burden of financial hardship.
The L&I COLA is calculated based on the Consumer Price Index (CPI), a measure of inflation and changes in the cost of living. By linking the adjustment to the CPI, the COLA ensures that benefits keep pace with rising prices, which would otherwise erode their value over time.
The COLA adjustment is a vital safety net for injured workers who may be unable to return to work due to their injuries. By providing ongoing financial support, the COLA helps these workers meet their basic needs and focus on their rehabilitation without sacrificing their quality of life.
Calculating the L&I COLA
The L&I COLA is determined by comparing the current CPI with the CPI from the previous year. If the CPI has increased, the COLA will be equal to the percentage change in the CPI. For example, if the CPI increases by 5% from one year to the next, the COLA will be 5%.
The COLA is applied to various workers’ compensation benefits, including monthly wage replacement payments, permanent partial disability benefits, and medical treatment costs.
Example of COLA Calculation
| Year | CPI | Change | COLA |
|---|---|---|---|
| 2023 | 100 | - | - |
| 2024 | 105 | +5% | +5% |
Historical Overview of the L&I COLA Program
The Labor & Industries (L&I) Cost-of-Living Adjustment (COLA) was established in 1982 as a way to help Washington state workers keep pace with rising living costs.
Historical COLA Adjustments
The COLA adjustment is based on the U.S. Bureau of Labor Statistics’ Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).
The following table shows the historical COLA adjustments that have been made to Washington state workers’ benefits:
Comparison to Other States and National Cost of Living Adjustments
Washington State L&I COLA
The Washington State Department of Labor & Industries (L&I) cost-of-living adjustment (COLA) for 2024-2025 is 2.8%. This increase is based on the change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for the Seattle-Tacoma-Bellevue metropolitan area from September 2023 to September 2024.
Comparison to Other States
The Washington State L&I COLA is comparable to the COLAs in other states in the region. For example, the Oregon Department of Consumer and Business Services has set the COLA for 2024-2025 at 2.9%, and the California Department of Industrial Relations has set the COLA at 3.0%.
Comparison to National Cost of Living Adjustments
The Washington State L&I COLA is slightly lower than the national COLA for 2024-2025, which is 3.0%. However, it should be noted that the national COLA is a weighted average of the COLAs in all 50 states and the District of Columbia. As a result, the national COLA may not be representative of the cost of living in all areas of the country.
Additional Information
The Washington State L&I COLA is used to adjust the benefits of injured workers who are receiving workers’ compensation benefits. The COLA is also used to adjust the maximum weekly benefit rate for workers who are injured on or after January 1, 2025 and all supplementary pension benefits payable under Chapter 51.32 RCW.
Table of COLA Rates
The following table shows the COLA rates for Washington State L&I benefits for the past 10 years:
| Year | COLA Adjustment |
|---|---|
| 1983 | 1.7% |
| 1984 | 3.5% |
| 1985 | 3.1% |
| 1986 | 1.3% |
| 1987 | 4.2% |
| 1988 | 4.8% |
| 1989 | 5.3% |
| 1990 | 5.4% |
| 1991 | 3.6% |
| 1992 | 3.1% |
| 1993 | 2.6% |
| 1994 | 2.8% |
| 1995 | 2.6% |
| 1996 | 3.0% |
| 1997 | 2.9% |
| 1998 | 1.9% |
| 1999 | 2.3% |
| 2000 | 3.4% |
| 2001 | 2.6% |
| 2002 | 1.3% |
| 2003 | 2.1% |
| 2004 | 2.7% |
| 2005 | 3.1% |
| 2006 | 2.9% |
| 2007 | 3.1% |
| 2008 | 5.1% |
| 2009 | -0.6% |
| 2010 | 0.0% |
| 2011 | 0.0% |
| 2012 | 1.1% |
| 2013 | 1.4% |
| 2014 | 1.2% |
| 2015 | 1.0% |
| 2016 | 0.9% |
| 2017 | 1.2% |
| Year | COLA Rate | |
|---|---|---|
| 2014-2015 | 1.3% | |
| 2015-2016 | 1.1% | |
| 2016-2017 | 0.5% | |
| 2017-2018 | 1.2% | |
| 2018-2019 | 2.4% | |
| 2019-2020 | 2.1% | |
| 2020-2021 | 1.9% | |
| 2021-2022 | 5.1% | |
| 2022-2023 | 2.5% | |
| 2023-2024 | 2.8%The L&I COLA and Its Role in Supporting Workers’ Wages———-The Labor & Industries (L&I) cost-of-living adjustment (COLA) is a crucial component of Washington State’s workers’ compensation system. Its primary function is to ensure that workers’ wages keep pace with inflation and maintain their purchasing power.### Benefits of the L&I COLA ###* Preserves Purchasing Power: The COLA adjusts wages to offset inflation, protecting workers from a decline in their purchasing power.* Encourages Reporting of Injuries: Adequate compensation through the COLA encourages injured workers to report their injuries promptly, leading to better outcomes.* Promotes Economic Stability: Increased spending by workers receiving COLA payments stimulates the local economy, fostering economic growth.### How the L&I COLA is Determined ###The L&I COLA is calculated annually based on the Consumer Price Index (CPI) for Urban Wage Earners and Clerical Workers (CPI-W). The CPI-W measures the change in the prices of a basket of goods and services commonly purchased by this population.If the CPI-W increases by 2% or more from the previous year, the L&I COLA is triggered. The adjustment is equal to 50% of the CPI-W increase that exceeds 2%.### Historical L&I COLA Rates ### | Year |
| Year | CPI-W Increase | L&I COLA Rate |
| 2023 | 7.7% | 2.75% |
| 2022 | 7.0% | 2.50% |
| 2021 | 4.9% | 1.45% |
| 2020 | 1.2% | 0.60% |
| Year | Projected COLA Adjustment | |
| 2024 | 3.2% | |
| 2025 | 2.9% | |
| Benefit Type | COLA Adjustment | |
| Permanent Partial Disability | 2.7% | |
| Death Benefits | 2.7% | |
| Medical Reimbursement Rates | 2.7% |