by Lori Brown, on Nov 15, 2023 7:15:00 AM
Employers in Washington State need to fully understand the requirements regarding Washington overtime laws and take action in order to avoid legal and financial penalties.
Washington Overtime Overview
In order to maintain compliance with Washington State Overtime Laws, workers must receive overtime compensation for all hours worked over 40 in a workweek. Overtime pay is not required for hours worked over eight in a single day, however, with the exception of (certain exceptions for public work projects).
What is a Work Week?
Employers may define a workweek as any seven-consecutive-day cycle. The cycle must begin and end on the same day and time every week. If an employer does not define a workweek, then the workweek should defaults to a typical calendar week of Sunday through Saturday.
Washington Overtime Compensation & Pay
Like federal overtime law, employers in Washington must generally compensate employees at least 1.5 times the employee’s regular hourly rate for all overtime hours worked.
Employers may be required to pay employees greater than 1.5 times their regular hourly rate if certain collective bargaining agreements are established. Double-time pay is generally not required, with the exception of certain public works projects.
How to Calculate Overtime Pay in Washington
Below is an example of a standard overtime rate calculation in Washington State.
Washington Overtime Calculation Example:
40 Regular Hours Worked
X $20.00 Per Hour (Regular Pay Rate)
= $800.00 Total Regwular Pay
$20.00 Per Hour (Regular Pay Rate)
+ 1 ½ Overtime Premium ($10.00 Per Hour)
= $30.00 Per Hour (Overtime Pay Rate)
10 Overtime Hours Worked
X $30.00 Per Hour (Overtime Pay Rate)
= $300.00 Total Overtime Pay
$800.00 Regular Pay
+ $300.00 Overtime Pay
= $1,100.00 Total Pay
What is a Regular Pay Rate?
An employee’s regular rate of pay or pay rate is their normal hourly wage. If an employee’s pay rate differs at times, then the average pay rate should be used as the regular rate of pay.
To determine an employee’s regular rate of pay add together weekly compensation (not including overtime) and divide by the total number of hours an employee worked during the week.
Compensation Included When Calculating the Average Regular Pay Rate:
- Hourly rates
- Salary rates
- Piece rates and flat rates
- Non-discretionary bonuses
- Performance-based, due to a contract, agreement, or promise
Compensation Excluded When Calculating the Average Regular Pay Rate
- Discretionary bonuses
- Such as a holiday bonus
- Tips and service charges
- Paid time off
Washington Overtime Eligibility
Washington Overtime rules apply to all employers. While the rules may apply to all employers, not all employees are eligible for overtime pay in Washington State.
Employees typically entitled to overtime compensation:
- Most hourly, piece rate, and commissioned employees
- Some salaried employees
- Employees working on prevailing wage jobs
- Employees working in the agriculture and dairy industries
Employees typically not entitled to overtime compensation:
- Employees who are exempt from overtime under federal law due to executive, administrative, and professional definitions
- Workers who do not meet the definition of “employee” under the Washington State Minimum Wage Act
- Employees who request compensatory time off in lieu of overtime pay
- Persons employed as “Seamen”
- Seasonal employees of agricultural fairs
- Unionized motion picture projectionists
- Truck or Bus Drivers Subject to Federal Motor Carrier Act
- Industries that are subject to federal law requiring overtime based on a workweek other than 40 hours
- Airline personnel who work more than 40 hours in a week if the hours are accrued as the result of a voluntary shift trade with another airline employee
Employers may mandate overtime work, requiring employees to work overtime with certain exceptions for the healthcare industry.
Washington Overtime Exemptions
A common misconception is that salaried employees are exempt from overtime requirements. However, only those employees who meet a specific salary level test and the definition of either an executive, administrative, or professional employee are exempt from overtime.
What Are Executive, Administrative, and Professional Employees?
There are three definitions of employees that are exempt from Washington State Overtime Requirements as defined by the FLSA.
In order to qualify for an executive exemption, an employee must pass the Salary Level Test as well as:
- Have a primary duty of either managing a business/company or managing a customarily recognized department or subdivision of a business/company
- Customarily and regularly direct the work of at least two or more other full-time employees
- Have the authority to hire and/or fire other employees, or their thoughts on similar decisions are given particular weight and consideration
In order to qualify for an administrative exemption, an employee must pass the Salary Level Test as well as:
- Have a primary duty of… office or non-manual work that is directly related to the management, or general business operations of either the employer or the employer’s customers, or that includes the exercise of discretion and independent judgment in regard to important matters
In order to qualify for a professional exemption, an employee must pass the Salary Level Test as well as:
- Have a primary duty of work requiring advanced knowledge, or in other words, work that is predominantly intellectual and requires the consistent exercise of discretion and judgment. This advanced knowledge must be in a field of science or learning and must be obtained by a prolonged course of specialized intellectual instruction (such as college)
- Have a primary duty of work requiring invention, imagination, originality, or talent in a recognized field of artistic or creative endeavor (Musicians, Composers, Engineers, etc.)
If an employee meets the salary level test and any of the above three definitions, the employee is exempt from overtime requirements.
Overtime for Washington Agricultural Businesses
In 2021 Washington State expanded its protections for overtime in the agriculture industry with the passage of ESSB 5172.
While prior to the new law, dairy workers were entitled to standard overtime requirements, now all agricultural workers are entitled to overtime requirements under Washington State Agricultural Overtime Law.
The state has a “phase-in period” for the new law, which will reduce the hours worked requirement each year. Below is a table overview of the phase-in period.
Date of Update
Hours Worked Threshold
Jan. 1st, 2022
55 hours during a single workweek
Jan. 1st, 2023
48 hours during a single workweek
Jan. 1st, 2024
40 hours during a single workweek
Washington Alternative To Overtime Pay
Alternatives to overtime exist for public employers only, employees are eligible to receive time off instead of overtime compensation. This is known as “comp” or “exchange” time.
At the request of the employee, an employee may receive 1.5 hours of paid time off for each hour of overtime that was worked.
Get Help with Washington Payroll Compliance
To learn more about processing payroll in Washington State or maintaining compliance with Washington State overtime pay and requirements, contact a Washington State Payroll Company. By leveraging experts for payroll outsourcing, or a modern paperless payroll solution, companies can avoid non-compliance fines and potential hefty legal penalties.
For help finding a provider, contact Employer Pass today.
Guest Author: Lori Brown
Lori Brown, CEO of PayNW a leading Washington payroll and HR services company, took the reins in September 2021 from founder Mike Anderson. Growing PayNW from $500K to $8M in annual revenue, Lori has maintained a 96% client retention rate, year over year. She is a talented leader, with extensive experience in payroll, Human Capital Management, Employee Retention Credit (ERC) efforts, and more. Lori was elected to the board of the Independent Payroll Providers Association in 2021 and is a Puget Sound Business Journal 40 Under 40 honoree. She is a mom of three and has been happily married for the past 20 years.