Washington State Department of Labor & Industries updating the job duties tests as well as setting a new minimum salary threshold.  These are both used to determine who can be classified as exempt from overtime among other things.  Employees with management-level and professional duties – Executive, Administrative and Professional workers (EAP), who are considered exempt from overtime pay will generally be affected.  These new state rules take effect July 1, 2020 with an initial increase and will be phased in incrementally through 2028.

Washington currently uses the U.S. Department of Labor minimum salary threshold which is $684/week or $35,568/year.  Beginning July 1, 2020 the new state salary threshold will be set at 1.25 times the state minimum wage, $675/week or $35,100/year.  Because the state uses whichever rule is more favorable to employees, it will continue to use the federal threshold.  But this will change January 1, 2021 as the state updates the multiplier used to 1.5 times the state minimum wage (estimated at $827/week or $43,004/year.)  You can find the implementation schedule from L&I here.  There is a different implementation schedule for hourly computer professionals, this schedule can be found here.  Please note that the threshold is updated slower for employers with 1-50 employees as compared to those employers with 51 or more employees.  By 2028 the multiplier will be 2.5 times the minimum wage and is estimated to be $1603/week or $83,356/year.

Washington State L&I has created an online tool that provides background on the upcoming changes in the overtime rules, and also includes a tool that can help determine if an employee likely qualifies as exempt or not.  You can access this tool here.  This tool has an guided overview of the updated rules as well as a classification tool to determine if an exemption likely applies.

Questions?

Contact:

David Carter | Director, Health Care Finance & Policy

C 360.888.5702