What is a third-party claim?

If someone other than an employee's co-worker or employer caused their workplace injury or illness, they may take legal action against this “third party.” The purpose of third-party law is to shift the cost of industrial insurance onto the responsible party. These recoveries replenish the workers’ compensation trust funds. Claim costs applied to your account are reduced or eliminated, depending on the amount recovered.

Contact your policy manager at (360) 902-4817 to find out how a specific claim is affecting your rates.

Learn more about third-party claims for workers and for attorneys/Special Assistant Attorneys General.

What can I do as an employer?

It is a worker’s right to seek recovery of damages. Only the worker may choose to pursue the third party or assign it to L&I to seek damages. The employer is not a party to the claimant’s recovery. However, any information that you can provide concerning the at-fault party or the circumstances of the accident will help us evaluate the factual and legal issues of the case.

Self-insured employers

If an injured worker settles a third-party case, send us the following:

• Written notice of the worker’s election.
• Signed settlement agreement or court order.
• Total amount of attorney fees and costs.
• Total amount of benefits paid, including time-loss, permanent partial disability and medical, excluding payments for Independent Medical Evaluations (WAC 296-15-495).

When we receive this information, we will issue an order confirming the distribution of the recovery (RCW 51.24.060).

If a self-insured employer pays time-loss benefits, there may be cost of living adjustments paid out of L&I’s Supplemental Pension Reserve fund. Payments may be made directly through pension payments or indirectly through quarterly reimbursements for time-loss compensation. L&I may have a lien against the recovery -- contact us to see if we do.