Opening or Closing L&I Accounts

This year has brought many changes to the business landscape in our state. Companies are innovating, adapting or making the difficult choice to close in response to the economic pressures brought on by the pandemic. If you are adding locations, opening new businesses, or closing and/or selling your business, one of the steps you will need to take is setting up or settling your accounts with L&I.

Adding Locations or Opening a New Business

The first step is letting the state of Washington know by filing a Business License Application with the Department of Revenue. This allows the state to assign a Unified Business Identification (UBI) Number. Depending on what you designate on the application, it also signals to other agencies that accounts should be established. Here are a couple of common scenarios with the appropriate business license application process:

  1. You have a new location opening up with the same ownership as your existing locations. If you want the businesses to have the same UBI, complete the Business License Application and select the option to add a location to an existing UBI. If you will have employees (even if you are not hiring them now), indicate on the application that you will be hiring. This signals the Department of Revenue to inform L&I and Employment Security to set up workers compensation and unemployment accounts.
  2. You have a new business with different majority ownership than your current businesses. Complete the Business License Application without listing the existing UBI and indicate that you will be hiring employees. L&I will create a brand-new policy, separate from your existing accounts.

As L&I sets up your policy, you have the choice of combined or separate reporting for your locations.

  1. Combined reporting places all locations under the same exact account number, (for example 123,987-00). You pay premium for all locations under one account and all claims are assigned to this account number, regardless of the location.
  2. Separate reporting places all locations under the same 6-digit policy but each will have separate sub-accounts (123,987-00; 123,987-01, 123,987-02, etc.). Separate reporting requires that premium be paid each quarter under each sub-account and claims are assigned to the specific sub-account for each location. There are pros and cons to each approach, and we can help you decide which is best for your business.

Closing or Selling one Location or Your Entire Business

The Department of Revenue is also the place to go to start the process of notifying state agencies of your changes. Completing a Business Information Change Form signals to Department of Revenue to notify Business Licensing, Employment Security, L&I, and the Secretary of State’s office of the pending closure/sale. You should also notify your L&I account manager and ERNwest Group Manager. L&I will require you to complete and file your final Quarterly Report. Your ERNwest Group Manager will help ensure that your L&I accounts are closed and no claims or penalties for late premium are assigned to your business after the business has closed.

These are trying times and ERNwest is here to help your company navigate the workers’ compensation waters, from account set-up to safety programs to claims management and to account closure if necessary. Please let us know if there is anything we can do to help.

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