By Clarissa Kell-Holland
Already struggling trucking companies in Washington state were stunned by an announcement that the Department of Labor and Industries will increase workers’ compensation insurance premiums in 2009.
While the average increase will be 3 percent for all businesses in the state, L&I spokesman Steve Pierce admits the rates will be more for higher risk industries such as trucking.
OOIDA Life Member Dale Wray of Spokane, WA, said his premiums went up 5 percent – enough to cause him to look at moving his 14-truck operation to Idaho “in disgust” over the increases.
“When I first heard the news I was shocked, then I got mad as hell,” Wray said. If they don’t care about me and my ability to make a living in their state, I have decided to take my business elsewhere and move.”
As of press time, Wray, OOIDA members Sherrie and Bob Bond of Chehalis, WA, and others were trying to arrange a meeting with lawmakers, L&I and the governor’s office to discuss implementing a moratorium because of the harsh economic conditions all businesses are facing. This action would suspend the premium increases in at least the first quarter.
Before L&I officials announced the final rate increases, several Washington state lawmakers – including Rep. Lynn Kessler, D-Hoquiam – said any hikes could put fledgling businesses under if approved.
“If we keep raising their taxes, how in the world are they going to stay afloat when they are barely hanging on now,” Kessler, who is majority leader in the House, told Land Line before the premium increases were announced.
Pierce said the increases are needed to ensure the contingency reserve remains “solvent.” He also said he recognizes that “businesses are struggling and that we are in very difficult times economically,” which Pierce said is why L&I didn’t ask for more.
He said, the agency was actually “pushing for a rate around 6.3 percent.”
In late 2008, Elaine Fischer, a Labor Department spokeswoman, told Land Line the agency had a $1.6 billion budget surplus, while another lawmaker, Kessler, said the actual amount may be as high as $3 billion.
“While there is this impression that we are sitting on this pile of money and we’re not doing anything with it, that isn’t correct,” he said. “We are required to keep contingency reserves, which is standard practice in the insurance industry.”
The Bonds, who have five log trucks, said every employer and every employee in the state should be “railing against the L&I rate increases.”
“For businesses already struggling in this state, this is terrible news,” Sherrie Bond told Land Line. “Every employee in this state is at risk of losing their jobs because their employers can’t afford to pay the increased workers’ compensation rates, so they have to weigh keeping their businesses afloat versus letting people go instead – and that’s just wrong.” LL