Washington’s Department of Labor & Industries is proposing a 4.9% average increase in the hourly workers’ compensation rates paid by employers and workers in 2027, a statewide change that would affect most businesses covered by the State Fund. The proposal, released Sept. 22, would add about $1.44 a week, or roughly $75 a year, for each full-time position on average before retrospective-rating refunds.
The figure is an average, not a uniform surcharge. An employer’s actual bill can move by more or less depending on its industry classification, claims experience and the frequency and cost of claims across that risk group. L&I’s rate tables show proposed 2027 base rates for individual business types and separate hourly charges for the accident, medical-aid, supplemental-pension and Stay at Work funds.
Under the proposal, employers would continue to cover about three-quarters of the average premium and workers about one-quarter. Washington is unusual because it charges most workers’ compensation premiums by hours worked and employees pay a significant share. L&I’s rate notice says 311 of the state’s 326 risk classes would have higher base rates in 2027. At the average, the combined charge would equal about $1.50 per $100 of payroll before refunds, close to the 2022 level.
The proposal reaches a large slice of the state economy. L&I says the State Fund covers about 2.8 million workers at roughly 205,000 employers. The agency charged approximately $2.8 billion in premiums during fiscal 2026, according to the same rate notice.
L&I attributes the proposed increase to rising wages, medical expenses and wage-replacement costs. The department says 4.9% is below the increase its actuaries project would be needed to cover 2027 claims fully, so it plans to use part of the system’s contingency reserve to bridge the difference. A State Register filing opened the formal rulemaking in June and identified the 2027 premium rates and experience-rating parameters as the subject of the proceeding.
Employers and workers still have a comment window before the rates become final. L&I scheduled an in-person hearing in Tumwater at 10 a.m. Oct. 27, a virtual hearing at 10 a.m. Oct. 28 and another virtual hearing at 2 p.m. Oct. 29. Written comments are due by 5 p.m. Oct. 29. The agency says it will adopt final rates Nov. 30 for an effective date of Jan. 1, 2027.
For businesses, the practical question is the classification-specific change rather than the statewide average. Employers can compare their code in the published tables and then apply their experience factor; even claim-free firms may see a base-rate change because risk is pooled within classifications. The public-hearing process can change the proposal before adoption, so the 4.9% figure should be treated as L&I’s current plan, not yet the final 2027 bill.
