L&I proposes new overtime rules

The Department of Labor and Industries is in the process of updating rules regarding exemptions to the minimum-wage act (MWA) which exempts executive, administrative and professional (EAP) workers. An exemption can have consequences for employers -- for example, someone who is exempt from MWA would therefore be exempt from mandatory overtime payments for working more than 40 hours a week.

Learn more about what L&I is proposing by clicking here.

Note that L&I’s proposal is in a “pre draft” phase; no date has been set for release of an official draft, but it is expected soon.

AGC worked with Association of Washington Business (AWB) and other business groups to comment on the pre-draft policy.  Among the arguments that the business community made are:

  • Consistency between state and federal law is key. The United States Department of Labor has been actively reviewing its rules regarding the EAP exemptions for nearly a year, and the DOL announced a few days ago that its new EAP proposed rule will be issued in March 2019. There is no need for the Department to prematurely create potential variances between state and federal law that are confusing, unnecessary, and at odds with Washington legislative intent. Employers, and particularly small employers, struggle to keep up with the increasingly complex employment regulatory environment.  Consistency between state and federal law greatly assists employers in understanding their obligations and enhances interstate uniformity and the State's economic competitiveness for economic development. 

  • The proposal to make the salary threshold a super-minimum wage is unlawful, is not supported by the regulatory record, and is incapable of being assessed through a valid cost/benefit analysis. The Department’s proposal to convert the salary-threshold test to a super-minimum wage (a multiple of the state minimum wage), and thereby control salary levels for exempt employees or force otherwise exempt employees to be paid as non-exempts, is fundamentally flawed. The Department does not have authority to establish a super-minimum wage salary level based on generally prevailing-wage or salary levels, or on policy views about how much salaried employees “should” make.

  • The pre-draft rules request comment on the possible inclusion of 80% and 60% “stopwatch” or time-and-motion tests in the executive, administrative and professional exemptions. This approach would be unlawful, and in any event highly undesirable from a policy standpoint. Since their adoption, the Washington and FLSA short tests for these exemptions have turned on the worker’s primary duty. There is no evidence in the record supporting a need to impose a stopwatch test on these exemptions, regardless of salary level.

AGC members are encouraged to share any comments they have about the proposed rules with AGC Chief Lobbyist Jerry VanderWood, 360.352.5000.