With the new year upon us, the below provides an update on what to expect in 2024 for Washington employers.
Minimum Wage Increase
Beginning in 2024, the minimum wage will increase statewide and in several notable cities.
Statewide Minimum Wage Increase
Washington’s minimum wage will go up $.54 per hour to $16.28 effective on January 1, 2024. The state minimum wage applies to workers 16 years and older. Employers can pay 85% of the minimum wage to workers ages 14-15, which is $13.84 in 2024.[1]
Seattle Minimum Wage Increase
The city of Seattle’s minimum wage for 2024 is $19.97 per hour for employers with 501 or more employees or employees with 500 or fewer employees if the employer does not contribute at least $2.72 per hour toward the employee’s medical benefits and/or where the employee does not earn at least $2.72 per hours in tips.[2] For employers with 500 or fewer employees that meet the contribution requirement, the 2024 minimum wage is $17.25 per hour.[3]
SeaTac Minimum Wage Increase
The city of SeaTac’s minimum wage for 2024 is $19.71 per hour.
New Salary Thresholds for Overtime Exempt Employees
Washington State
Washington’s threshold for employees exempt from the Minimum Wage Act will increase as a result of the minimum wage increases.[4] Unlike past years, the threshold is the same for large and small employers. Starting January 1, 2024, the threshold for all employers will be two times the state minimum wage. This means an employee exempt from overtime pay must earn at least $1,302.40 a week or $67,724.80 a year.
These rules also apply to computer professionals, who must be paid an hourly rate rather than a salary. Computer professionals are exempt if they earn not less than 3.5 times the state minimum wage, which increases to $69.90 an hour effective January 1, 2024, as a result of the higher minimum wage.[5]
Non-Compete Agreements
Beginning January 1, 2024, there will be another increase to the minimum annual threshold for enforceable non-compete agreements in Washington. Non-compete agreements are void against employees and independent contractors whose annual salaries earned are less than $120,559.99 and $301,399.98, respectively, in 2024.[6] If a non-compete is found to be void, an employer is liable for an employee’s actual damages or $5,000, whichever is higher, along with attorneys’ fees and costs.
Paid Sick Leave for Certain Construction Workers
Effective January 1, 2024, employers must pay out accrued and unused sick leave balances to certain workers in the construction industry after separation. This change applies to workers covered under the North American Industry Classification System ("NAICS") Industry Code 23, except for NAICS Code 236100 (residential building construction), who have not worked for 90 consecutive days at the time of separation. This NAICS industry code covers construction workers. It also covers administrative staff at enterprises performing construction work and other workers associated with construction work.[7]
Settlement of Wage Complaints Made to Labor and Industries Must Include Payment of Interest at One Percent per Month
Employees claiming that their employers withheld wages can file a claim with the Department of Labor and Industries (“L&I”). State law requires that employers who settle these claims pay one percent for each month they withheld wages from employees. However, L&I and employers often agreed to waive this interest as part of settling wage claims.
Effective January 1, 2024, L&I will have less flexibility to settle wage claims and wave accrued interest. Going forward, if L&I offers the employer the option to settle a wage complaint without citation and notice of assessment and the employer chooses to accept the settlement, the settlement must include one percent interest per month on all amounts owed.[8]
Employers May No Longer Conduct Pre-Employment Drug Testing for Off-Duty Cannabis Use
Washington State is following the trend when it comes to outlawing drug testing for cannabis off-duty use. RCW 49.44.240 has been amended to prohibit employers from making a hiring decision in the pre-employment process related to the applicant’s off-duty use of cannabis. With some exceptions, this new law applies to all Washington employers. An employer may still conduct pre-employment drug testing for other drugs through methods that do not screen for non-psychoactive cannabis metabolites. An employer may also continue to enforce a drug and alcohol-free workplace and comply with other rights or obligations required by federal law or regulation. Employers may also continue to conduct testing post-accident and when there is a reasonable suspicion of being under the influence while on duty.
The following is a list of the employers and/or job positions that are exempt from this amended law:
-
- A position requiring federal government background or security clearance;
- Law enforcement;
- Fire Department;
- First responder, including dispatchers;
- Correction officer;
- Airline or aerospace industry;
- Safety-sensitive position for which impairment while working presents a substantial risk of death. Such safety-sensitive position must be identified by the employer prior to the applicant’s application for employment.
This law does not preempt state or federal laws requiring an applicant to be tested for controlled substances. This includes requirements placed on employers receiving federal funding or as required by a federal contract.
If you have any questions about this legal update or any other legal developments, please contact the authors or GRSM's Employment Law team for more information.
[1] https://www.lni.wa.gov/workers-rights/_docs/FY24-1412024MinimumWageAnnouncementEnglish.pdf
[2] https://www.seattle.gov/laborstandards/ordinances/minimum-wage
[3] https://www.seattle.gov/laborstandards/ordinances/minimum-wage
[4] https://www.lni.wa.gov/forms-publications/F700-207-000.pdf
[5] https://www.lni.wa.gov/forms-publications/F700-213-000.pdf
[6] https://apps.leg.wa.gov/documents/Laws/WSRPDF/2023/20/23-20-086.pdf
[7] https://www.lni.wa.gov/rulemaking-activity/?cardNo=AO23-18&query=296-128&utm_medium=email&utm_source=govdelivery
[8] RCW 49.48.083(6), https://app.leg.wa.gov/rcw/default.aspx?cite=49.48.083