Small business owners and workers compensation L&I audits in Washington

All employers in the state of Washington must maintain workers’ compensation insurance for their employees. The Washington State Department of Labor & Industries audits employers infrequently. Your notice will come in the mail, which is why it is so important to keep a central office location for all of your paperwork. Your audit notice will include a pre-audit questionnaire. This questionnaire is a legal document, so you want to review it very carefully before you sign.

There are some common themes in which business owners are selected for an audit each year:

  • Your business paid a workers compensation claim after an injury. An injury will often trigger an audit.

  • You have been audited in the past and paid a fine. L&I employees frequently return to the same employers over and over.

  • Your business may be part of a “target” industry for L&I that year. For example, the Department has emphasized audits for staffing agencies and telecommunication companies in past years.

  • Someone has filed a complaint against your business.

  • A compliance review at a construction site turned up red flags, and every employer involved is being checked by L&I again.

  • A contractor or subcontractor you worked with was audited for workers compensation and L&I investigators are looking into everyone connected to that employer.

  • Your small business was chosen at random. Sometimes L&I just picks a name.