Minimum Wage

Minimum Wage https://wahospitality.org/wp-content/uploads/2018/01/shutterstock_707531416.jpg

There are currently five minimum wages in Washington state:

 

State Minimum Wage

Due to the passage of Initiative 1433, in Nov. 2016, the state minimum wage:

  • Increased to $11 per hour in 2017.
  • It will increase to $11.50 per hour in 2018, $12 per hour in 2019 and to $13.50 per hour in 2020. Starting on Jan. 1, 2021, minimum wage increases will be calculated by L&I using a formula tied to the rate of inflation based on the Consumer Price Index.
  • Initiative 1433 reinforces that tips and service charges cannot be counted towards meeting minimum wage requirements.
  • Under Initiative 1433, local minimum wage ordinances will continue to remain in effect.
  • If you have questions for the state about the state minimum wage, contact L&I’s Wage and Hour Division at 866.219.7321 or email esgeneral@lni.wa.gov.
  • For general information on state administrative policies, visit http://lni.wa.gov/WorkplaceRights/Rules/Policies/default.asp.
  • If you have any further questions about this topic or others, see the Department of Labor & Industries’ Help for Small Business page at http://www.lni.wa.gov/Main/SmallBusiness/.

 

SeaTac Minimum Wage

  • Currently $15.64 (adjusted annually)
  • SeaTac minimum wage is adjusted annually based on changes in inflation as measured by the Consumer Price Index (CPI-W).
  • The minimum wage is for certain hospitality and transportation workers in and near the Seattle-Tacoma International Airport.
  • Including: “Hospitality Employer” means a person who operates within the City any Hotel that has one hundred (100) or more guest rooms and thirty (30) or more workers or who operates any institutional foodservice or retail operation employing ten (10) or more non-managerial, nonsupervisory employees. This shall include any person who employs others providing services for customers on the aforementioned premises, such as a temporary agency or”

 

Tacoma Minimum Wage

For more detail, see Tacoma Minimum Wage Guide at http://wahospitality.org/blog/tacoma-minimum-wage-survival-guide/

  • 11/4/15 – Tacoma voters approved a $12 city minimum wage phased in over two years
  • $10.35 per hour on Feb. 1, 2016
  • $11.15 per hour on Jan. 1, 2017
  • $12 per hour on Jan. 1, 2018
  • Adjusted annually by the rate of inflation beginning Jan. 1, 2019

 

Seattle Minimum Wage

For more detail, see Seattle Minimum Wage Guide at http://wahospitality.org/blog/minimum-wage-seattle-ordinance-and-more/

Seattle Large Employer Schedule 1 (500 or more employees in U.S.) Minimum Wage

As of Jan. 1, 2018, the City of Seattle’s minimum wage for large employers is $15.45 or $15.00 per hour with medical benefits provided.

Large employers can meet this requirement in two ways:

  • Pay hourly minimum wage; or
  • Pay reduced hourly minimum wage if the employer makes payments toward an employee’s silver level medical benefits plan.

1. Hourly Rate

Large employers who do not pay towards an employee’s medical benefits plan pay hourly minimum wage based on the following schedule:

Minimum Wage
2016 (Jan. 1) $13.00/hour
2017 (Jan. 1) $15.00/hour
2018 (Jan. 1) $15.45/hour

 

2. Medical Benefits

Large employers who do make payments toward an employee’s medical benefits plan pay a reduced minimum wage based on the following schedule:

Minimum Wage

2016 (Jan. 1)

$12.50/hour

2017 (Jan. 1)

$13.50/hour

2018 (Jan. 1)

$15.00/hour

On Jan. 1, 2019, payments toward medical benefits will no longer impact employees’ minimum wage. In subsequent years, the City of Seattle will calculate percentage changes to the minimum wage based on the Consumer Price Index (CPI).

 

Seattle Small Employer Schedule 2 (500 or fewer employees in U.S.) Minimum Wage

For small employers, the City of Seattle’s $15.00/hour wage will be phased in over the next 5–7 years.

All small Seattle employers are required to pay minimum compensation. Small employers can meet this requirement in two ways:

  • Pay hourly minimum compensation rate; or
  • Pay hourly minimum wage and make up the balance with employee tips reported to the IRS and/or payments toward an employee’s medical benefits plan.
  1. Hourly Rate

Small employers pay hourly minimum compensation rate based on the following schedule:

Minimum Compensation
2016 (Jan. 1) $12.00/hour
2017 (Jan. 1) $13.00/hour
2018 (Jan. 1) $14.00/hour
2019 (Jan. 1) $15.00/hour
  1. Tips and/or Medical Benefits

Small employers pay an hourly minimum wage and reach the minimum compensation rate through employee tips reported to the IRS and/or payments toward an employee’s medical benefits plan. If the tips and/or payments toward medical benefits do not add-up to the minimum compensation rate, the small employer makes up the difference.

Minimum Compensation Minimum Wage
2016 (Jan. 1) $12.00/hour $10.50/hour
2017 (Jan. 1) $13.00/hour $11.00/hour
2018 (Jan. 1) $14.00/hour $11.50/hour
2019 (Jan. 1) $15.00/hour $12.00/hour
2020 (Jan. 1) TBD $13.50/hour
2021 (Jan. 1) TBD $15.00/hour

 

In 2025, small employers will pay the same minimum wage rate as large employers and will no longer count employee tips and/or payments toward an employee’s medical benefit plan toward minimum compensation. The City of Seattle will calculate percentage changes to the minimum wage based on the Consumer Price Index (CPI).

 

For more information on Seattle’s Minimum Wage Ordinance, see https://www.seattle.gov/laborstandards/ordinances/minimum-wage

 

Rev. 1/16/18

 


This article is an excerpt from the Handbook for Excellent Restaurant Operations (HERO), published by the Washington Hospitality Association.  Want a hard copy of the whole manual?  It’s one of the many benefits of becoming a member!  Find out more about joining the Washington Hospitality Association here.

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Categories: HERO