State of Washington Changes FLSA Rules by January 1, 2021

Washington State Capitol

On January 1, 2021, our clients in the State of Washington will be fully prepared as they have anticipated and appropriately funded increases in payroll costs. Beginning January 2021, the state has a new salary threshold that exceeds the federal requirements.

Because of the state's decision to change the threshold for FLSA, many employers (including our clients) will be forced to either raise employee salaries to maintain exemptions for overtime pay or reclassify employees as non-exempt and pay overtime, offer paid sick leave and of course meal breaks.

Right now the state's threshold is $684 per week ($35,568 per year). By January 2021, smaller employers (with 50 or fewer employees) will see the minimum salary level rise to $827 per week (or $43,004 per year), while all other employers will face an increase to $965 per week (or $50,180 per year). It will continue to climb, with the salary threshold approaching $1,603 per week ($83,356/year) by 2028 and adjusted for inflation thereafter.

Computer professionals may be paid either the new required salary or new, higher hourly rates. In July 2021, their base hourly rate must be at least $27.63; beginning January 2021, it will be equivalent to 2.75 times and continue to climb thereafter.

Prudential Global Network assists clients in the State of Washington in addressing the challenges brought about by the state's new mandate on FLSA. We provide job classification reviews, salary structure review and rebuilding, as well as changes to policies involving new placements, promotion, transfers, and disciplinary measures.

Elena C. Mason, SPHR, CCP, Prudential Global Network

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