As of January 1, 2025, Washington’s minimum wage will rise to $16.66 per hour, a 2.35% increase from 2024. This change affects not only hourly employees but also exempt workers, younger employees, and even rideshare drivers.
Here’s what employers need to know to stay compliant:
Key Changes
- Minimum Wage Increase: All Washington businesses must pay employees at least $16.66 per hour starting January 2025. The minimum wage for workers aged 14-15 will be $14.16 per hour.
- Local Adjustments: Employers should ensure that their city does not have a different minimum wage ordinance. Cities like Bellingham, Renton, SeaTac, Seattle, and Tukwila have higher minimum wage requirements and are planning for another increase in 2025. Please refer to L&I minimum wage webpage for these increases; not all of them have been announced yet.
- Overtime Exemptions: The salary threshold for exempt employees is also increasing. For 2025, small employers (fewer than 50 employees) must pay exempt employees at least $1,332.80 per week, while large employers (51+ employees) must pay at least $1,499.40 per week. This change is part of the ongoing incremental increases under the state’s 2020 overtime rule adjustments, ensuring that Washington employees are compensated fairly for their work.
- Rideshare Drivers: Drivers for companies like Uber and Lyft will see new pay minimums as well. For trips in Seattle, drivers will earn 68 cents per minute and $1.59 per mile.
Action Steps for Employers
- Update Payroll Systems: Ensure payroll systems are adjusted to reflect the new minimum wage and exempt salary thresholds. This might involve revisiting employment contracts and adjusting software to handle different wage rates in various locations.
- Communicate with Employees: While not legally required statewide, written notice of wage increases is a best practice. It promotes transparency and can help improve employee retention and morale, especially in regions with competing wage ordinances.
- Review Classification of Exempt Employees: With the new salary thresholds for exempt employees, it’s critical to review which employees qualify for exemptions from overtime. Failing to meet the threshold can lead to legal and financial penalties.
- Compliance with Local Ordinances: Employers must stay updated on wage laws not just at the state level but also locally. Cities such as Bellingham, Renton, and Tukwila have set higher minimum wage standards, and failing to comply can lead to fines or legal action.
Why These Changes Matter
The 2025 minimum wage increase reflects Washington’s commitment to ensuring that wages keep up with the rising cost of living. For businesses, while this can mean increased operating costs, compliance is essential to avoid penalties, foster a fair workplace, and retain talent in an increasingly competitive labor market.
For further details on the 2025 wage changes, or to review your compliance practices, feel free to contact JB Consulting Systems. Our team is here to help you navigate these transitions smoothly, ensuring your business stays compliant and employees are fairly compensated.
Resources:
- Washington State Department of Labor & Industries. “Washington’s Minimum Wage Going Up to $16.66 Per Hour in 2025.” Washington State Department of Labor & Industries, September 30, 2024. Accessed October 15, 2024. https://www.lni.wa.gov/news-events/article/24-24.
- Vigilant Law Group. “Washington: Minimum Wage and Exempt Salary Increases in 2025.” Vigilant Law Group, October 2024. Accessed October 15, 2024. https://www.vigilant.org.