The House Labor & Workplace Standards Committee recently heard testimony on HB 1184, a bill designed to alleviate the burdensome overtime-exempt salary requirements affecting nonprofits and small businesses. Advocates, including the Nonprofit Association of Washington and chambers from across the state, highlighted how the Labor & Industries (L&I) rules have forced organizations to alter service models, harming communities and demoralizing staff by converting directors to hourly positions.
In January 2020, L&I introduced rules significantly increasing the salary threshold for overtime exempt employees. Since then, the threshold has risen by 93%, far outpacing the 21% increase in the minimum wage during the same period. If the current multiplier schedule remains unchanged, the threshold is projected to increase by another 40% by 2028, assuming a 3% annual minimum wage rise.
WR testified in support of small and main street retailers, emphasizing that the high salary threshold stifles innovation, creates barriers, and fosters inequities for entrepreneurs seeking to address unmet needs.
Changing these rules will be challenging, as many House Labor Committee members represent King, Pierce, and Snohomish counties, where the impact of the rules has been less severe. Success will require strong grassroots advocacy to influence the majority party’s stance.