Minimum wage – It may seem like a straight-forward concept, here in Washington State, it’s anything but. There are three cities – SeaTac, Seattle, and Tacoma – that each have their own minimum wage ordinances/standards that are higher than the Washington State minimum wage. When you have employees making minimum wage (or close to it), take note of scheduled increases.
We want to help educate employers on laws and regulations both city and state-wide; so, without further ado, here’s a snapshot on all the minimum wage laws within Washington State.
Washington State Minimum Wage / Initiative I-1433
Let’s start with the state law. The 2018 Washington State Minimum Wage is $11.50 / hour for both agricultural and non-agricultural jobs. However, there is an exception for young workers; employers may pay 14 and 15-year-old workers $9.78 / hour, which is 85% of the minimum wage.
Washington State voters passed Initiative I-1433 in 2016, which outlined 4 primary changes to state law: annual increase in minimum wage rates, paid sick leave, tips and service charges, and retaliation protections. We will speak to the annual minimum wage increases and paid sick leave in this blog post.
Annual Minimum Wage Increases
Initiative I-1433 secured annual Washington State minimum wage increases until 2020. In 2019, the minimum wage will be $12, and in 2020 Washington State will raise it to $13.50. Starting January 1st, 2021, minimum wage increases will be calculated by Washington Labor & Industries using a formula directly tied to the rate of inflation.
Paid Sick Leave
This part of Initiative I-1433 requires employers to provide employees with paid sick leave. The law took effect starting January 1st, 2018, and under it, employees (including part-time & seasonal workers) must accrue paid sick leave at a minimum rate of 1 hour for every 40 hours worked. Employees are entitled to use this paid sick leave beginning on the 90th calendar day after the start of their employment. These employees can carry over up to 40 hours of unused sick leave to the following year.
Employees can use paid sick leave to care for a variety of needs, including:
- To address the health needs of themselves or of a family member (child, parent, sibling, grandchild, grandparent)
- When health-related reasons force their workplace or the school/care facility of their child to close
- For absences that qualify under Washington State’s Domestic Violence Leave Act
For more information about Initiative I-1433, please visit the Washington L&I website.
Seattle Minimum Wage
On April 1st, 2015, the City of Seattle put into place the Seattle Minimum Wage Ordinance. Per the Office of Labor Standards, this legislation essentially “sets wages for employees working within city limits. The minimum wage will increase every year on January 1 and eventually rise to $15.00/hour.”
As of the time of this writing (March 2018), the City of Seattle is in phase four. Phase four can mean different rates for different circumstances:
- Employers with 501+ employees are paying $15.45 / hour; however, if a 500+ employee company pays toward an individual employee’s medical benefits, then the minimum wage will drop to $15 / hour.
- Employers with 500 or fewer employees are paying $14 / hour. If employers with 500 employees or fewer pay $2.50 / hour toward medical benefits or an employee earns $2.50 / hour in tips or commissions, then the employer pays $11.50 / hour.
By 2021, the city will require everyone to pay at least $15 / hour. The City of Seattle provided a multi-year chart to summarize the breakdown by year and company size.
Paid Sick & Safe Time in Seattle
Though there is a state-wide policy in place, Seattle has its own Paid Sick & Safe Time (PSST) policy. The City of Seattle bases PSST accruals and carryovers on company size – separating into three tiers: small (tier 1), medium (tier 2), and large (tier 3).
- Small, 1-49 Full-Time Equivalents, Tier 1: Employees accrue 1 hour per 40 hours worked and can carry over up to 40 hours of PSST per year. This is the same accrual/carry-over rate as Washington State.
- Medium, 50-249 Full-Time Equivalents, Tier 2: Employees accrue 1 hour per 40 hours worked and can carry over up to 56 hours of unused PSST per year.
- Large, 250+ Full-Time Equivalents, Tier 3: Employees accrue 1 hour per 30 hours worked and can carry over up to 72 hours of unused PSST per year. However, if a Tier 3 employer offers a PTO package of any kind, that employee can carry over up to 108 hours per year.
For more information about Seattle’s PSST policy, visit the City of Seattle website.
Tacoma Minimum Wage
In November 2015, Tacoma voters passed a $12 / hour minimum wage that was designed to be phased in over the course of two years. As of January 1st, 2018, the Tacoma minimum wage is $12 / hour; the City of Tacoma will continue to adjust it annually to the rate of inflation starting in 2019.
The only employees that are exempt from the Tacoma initiative are workers under the age of 16 and those that are covered by special state certificates issued according to a section within Title 49 of the Revised Code of Washington (RCW). This includes disabled workers, student learners, learners, apprentices, and student workers.
The City of Tacoma offers email updates on minimum wage, which you can sign up for here.
SeaTac Minimum Wage
The City of SeaTac has two different minimum wage rates, broken down not by company size, but by industry. For those working in hospitality and transportation industries (like those at the Seattle-Tacoma International Airport, for example), the minimum wage is $15.64 / hour. Annually, the City Manager calculates an increased rate based on inflation; every October, the City Manager announces what the rate for the following year will be. For all updates, you can visit their Employment Standards Ordinance page.
For workers outside of the hospitality and transportation industry, SeaTac honors the state minimum wage of $11.50 / hour.
AS WASHINGTON STATE CONTINUES TO BOOM…
We can expect Washington State Minimum Wage rates to continue to rise well ahead of the federal minimums; however, even though the rate seems high, given higher sales taxes and rising rents, $11.50 doesn’t stretch very far. It’s important to keep in mind that if you can afford to, you should try to exceed the minimum wage rate to attract and retain a higher caliber of candidate.