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THE state Court of Appeals has finally issued a decision that gives a green light to workers’ compensation settlement agreements. So far, so good. But Washington’s law was such a weak-kneed thing in the first place that lawmakers ought to see the ruling as a signal for further reform.

For the last three years, the state Board of Industrial Insurance Appeals has refused to implement a workers’ comp reform law as the Legislature intended. The law allowed injured Washington workers to settle their claims, rather than requiring long-term pensions — a choice given to workers in 44 other states. Settlements were supposed to save big money, but the program has been a disappointment, and the Department of Labor & Industries has had to reduce its savings estimates by about $250 million.

One big reason is that the appeals board insisted on second-guessing any settlement negotiated by an attorney.

The board maintained it had to determine whether the deals were in the best interests of workers, even when workers hired attorneys who presumably were vetting the agreements already. That snarled the process to the point that few settlements were proposed, and fewer awarded.

Last week, in a case involving a South Kitsap School District employee, Daniel Zimmerman, the Court of Appeals ruled against the board and said the law meant what it said.

The decision removes one obstacle to an effective program. The rest is up to lawmakers. Union opposition led them to pass a highly restrictive bill in 2011, limiting settlements to workers in their 50s, insisting on “structured” rather than lump-sum payouts, and barring settlement of medical claims. Potential for huge savings remains if age restrictions are eliminated and lump sums are permitted. One state estimate put potential savings at $1.2 billion over the first two years.

High workers’ comp premiums are among Washington employers’ biggest complaints. Now that the court has acted, the Legislature should finish what it started.

Editorial board members are editorial page editor Kate Riley, Frank A. Blethen, Ryan Blethen, Sharon Pian Chan, Lance Dickie, Jonathan Martin, Erik Smith, Thanh Tan, William K. Blethen (emeritus) and Robert C. Blethen (emeritus).