WA Minimum Wage Will Rise In 2021, Forces Changes To Salaries, OT

SEATTLE — Starting on January 1, 2021, the minimum wage in Washington state will be $13.69 per hour.

In 2016, Initiative 1433 laid out how minimum wage would increase over the next four years. Now that that time has passed, the Washington State Department of Labor & Industries has been called into calculate the minimum wage for the first time increase since that initiative was approved. That's important— it means that this year's minimum wage increase will also impact some salaried employees who are normally exempt from overtime.

The increase also applies to workers under 16. In Washington, workers age 14 and 15 can be paid just 85 percent of the standard minimum wage. That means they will earn at least $11.64 an hour in 2021.

As businesses adapt their payrolls to include the minimum wage increase, Labor and Industries says there are a few things everyone should keep in mind:

• Tips and service charges do not count towards the minimum wage payments.
• Agriculture workers and farmworkers cannot be paid less than the minimum wage. Even if they are normally paid on a piece-rate basis, they must make at least $13.69 per hour.
• The cities of Seattle and SeaTac have set their own minimum wages, which are higher than the state's. They will remain higher in the new year.
  • Seattle's minimum wage remains $15.75 per hour.
  • SeaTac's minimum wage is $16.34 per hour.

L&I says the 2021 minimum wage is based on a 1.39 percent increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers over the past year. But it also will impact salaried workers, including computer professionals, and executive, administrative and professional workers.

Due to the higher minimum wage, salaried employees will now make more money in order to remain exempt from overtime payments:

• For a company with 50 or fewer employees, the employee must earn at a salary of at least 1.5 times the minimum wage, or $42,712.80 a year.
• For companies with 51 or greater employees, the employee has to earn at least 1.75 times the minimum wage, or $49,831.60 annually.

More information on the change and how L&I enforces labor protections like the minimum wage, can be found on their website.