$80,000 Salary to Avoid Overtime Under L&I's Proposed Rule Change

Date: February 04, 2019

Take action immediately! Deadline to submit written comments is 11:59 a.m. September 20

Starting July 1, 2020, L&I plans a six-year phased implementation to raise salary threshold to 2.5 times the state minimum wage for qualifying workers to be exempt from overtime, sick-and-safe leave requirements.

The Department of Labor & Industries is accepting public comment on its proposed update to the state’s overtime rule. Technically, the rule is the Executive, Professional and Administrative (EAP) exemption to the state’s Minimum Wage Act. The department’s Fact Sheet can be read here.

To be exempt from overtime (and paid sick leave requirements) workers must meet the “duties test” for executive, professional, administrative, outside sales, or computer professionals, and be paid at least the minimum salary contained in the rule. The existing rule hasn’t been updated in over 40 years.

The department intends the revised rule will closely align with the federal duties test. NFIB supports the state following the federal rule to make compliance easier by avoiding conflicting definitions or requirements.

Unfortunately, the state salary threshold, if approved, will far exceed federal requirements, even under changes being considered by the Trump Administration.

Beginning July 1, 2020, the department plans to initiate a six-year phased implementation to raise the salary threshold to 2.5 times the state minimum wage. Smaller employers, those with 50 or fewer employees, would have a slower implementation schedule than employers with 51 or more employees.

*For 2021 on, L&I estimated the state minimum wage increases based on an annual CPI-W adjustment of 2.17%, which has been the average increase over the last 20 years.

Computer professionals would need to earn at least 3.5 times the state minimum wage (SMW), phased-in over two years, to be exempted from overtime and paid sick leave requirements:

  • July 1, 2020: No change for employers with 50 or fewer employees (currently $27.63 hourly); 2.75 x SMW ($1,485) for employers with 51 or more employees
  • Jan 1, 2021: 2.75 x SMW for small employers; 3.5 x SMW for larger employers
  • Jan 1, 2022: 3.5 x SMW for all employers

The deadline to submit written comments is 11:59 a.m., September 20. These can be emailed to [email protected]

The department will have more information available online here.

Other L&I News of Small Business Importance

Visit L&I’s Lead Rulemaking webpage for current information on its proposal to update occupational lead standards for the first time in 40 years. For more information on the first hearings, which are currently not on the Lead Rulemaking webpage, click here.


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