L&I proposes overtime threshold of nearly $80,000 by 2026

L&I proposes overtime threshold of nearly $80,000 by 2026 https://wahospitality.org/wp-content/uploads/2019/09/LI-proposes-overtime-threshold.jpg

By Nicole Vukonich

The Department of Labor and Industries (L&I) has filed a rulemaking notice (CR-102) that would update the state’s salary overtime threshold for executive, administrative and professional (EAP) employees during the course of six years to 2.5 times the statewide minimum wage beginning in 2020. The projected salary overtime threshold for small and large businesses in 2026 would be $79,872 and adjusted annually for inflation thereafter.

“We agree that the overtime threshold needs to be updated,” said Anthony Anton, president and CEO of the Washington Hospitality Association. “We appreciate the phase-in period and the alignment with the federal government for the first year of the implementation in 2020.”

The Washington Hospitality Association and its members are actively engaged in the discussions surrounding the updates to the EAP rules. The hospitality industry is unique in that it offers all levels of jobs, from entry-level to senior management and ownership. With a proposed salary threshold of $79,872 by 2026, many of the critical middle management positions in the industry would likely revert to hourly as employers examine the implementation of this new rule for their businesses.

“We are concerned about what this overtime rule could do for hospitality employees seeking to break into management,” Anton said. “We will be talking with our employees and members to make sure solutions can be found.”

The Department of Labor & Industries classifies a small business as one that employs one to 50 people, and a large business is determined as one that employs 51 or more people. The department will likely have technical guidance in the future telling operators of how employees are counted.

“We are a solutions-driven industry and will continue to be actively engaged in the overtime discussions as we seek member feedback to the proposed rule,” Anton said.

L&I will be accepting public comments on the proposal until 11:59 p.m. on Sept. 20. Additionally, the department will hold public hearings across the state.

With the open public comment period, the association encourages members at the following link to give their feedback to L&I on the proposed update to the salary overtime threshold. https://p2a.co/9GCDrCo

Click here to check out L&I’s comparison chart of the federal duties test with the proposed state duties test.

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