New regs require a minimum salary for workers to be exempt from overtime
The State of Washington 2021 minimum wage and salary rates have been announced. The minimum wage is going up in line with a voter-approved initiative that became law in 2017. New regulations set a minimum salary rate for the first time for an entire. The minimum salary is amount you must pay some kinds of salaried workers to make them exempt from paid overtime,
Minimum Wage: $13.69 an hour
The Department of Labor and Industries set the minimum wage for 2021 at $13.69 an hour, up from $13.50 this year. The minimum wage has been rising each year since 2017, when Initiative 1433 took effect. This year saw the last big jump ($1.50 an hour) to reach the target of $13.50 specified in the voter mandate. Starting in 2021, and each year after that, the Department of L&I ties the increase to a cost of living allowance. The COLA is based on the federal Consumer Price Index’s increase of 1.39 percent.
Minimum Salary: It Depends
Salaried executive, administrative and professional workers, as well as computer professionals must earn a minimum salary to exempt any hours over 40 per week from earning overtime. Starting July 1 this year, the Department of L&I requires those workers earn a multiplier of the minimum. For 2021, companies with fewer than 50 employees must pay their salaried workers 1.5 times the minimum wage ($821.40 a week or $42,712.80/year). Companies with more than 50 employees must pay 1.75 times the minimum wage ($958.30 a week or $49,831.60/year).
The state is phasing in the multiplier approach to minimum salaries. The target is 2.5 times the minimum wage in 2028. After that, increases will link to the CPI. The new policy was forged following policy meetings and several public hearings beginning in 2018.
The Washington 2021 minimum wage and salary rates take effect January 1.
This Department of Labor and Industries page details all the changes for 2021.
The University of Washington has an ongoing study examining the economic effects of raising the minimum wage.
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