What Hiring Managers Should Know About Exempt Employees in Washington State

Staying informed about your responsibilities as an employer of exempt employees in Washington State is crucial, not just for compliance with labor laws, but for building a productive and well-structured workplace. Washington's employment regulations include strict criteria for exempt status, and overlooking them can lead to legal risks and employee dissatisfaction.
Moreover, exempt employees will continue to receive a specified salary regardless of the number of hours worked. However, this does not mean that the employer does not have to comply with certain Washington labor and employment laws specific to rules and exemptions.
This article is designed to guide Washington employers through the maze of tough issues that come with managing exempt employees. It answers those all-important questions faced by small and medium-sized companies and provides valuable insights for ensuring that you are aligned with state-specific employment regulations.

What is an exempt employee in Washington State?

In Washington, "exempt" employees are not entitled to overtime benefits that are given by the state's minimum wage statutes. To be exempt, they have to fulfill government regulations. Regarding exempt categorization in Washington, here are a few basic factors that both employers and employees should take into account.

For Employees:

• Consistent Salary: Regardless of hours worked or completed work, an exempt employee is paid a flat salary amount. 
• No Overtime: Generally, they will not receive overtime payment at one and a half times their salary for work exceeding 40 hours a week. 
• Minimum Wage: Exempt employees are not subject to the state's minimum wage provisions. Instead, they must meet specific salary thresholds and job duty requirements to qualify for exempt status.
• Flexibility: Generally, exempt employees have greater freedom to adjust their work hours or work schedule.

For Employers:

• Certain Criteria Need to be Met: To qualify for exemption, certain specific criteria related to job duties, salary level, and salary basis must be fulfilled. A misclassification in this regard can lead to a lawsuit.
• Payroll: Since exempt employees are not entitled to receive overtime payment, such salary budgeting is a uniform exercise for the employers.
• Schedule Flexibility: Exempt employees tend to have more freedom to request non-traditional work hours, and thus, employers should plan to support that ability. 
• Legal Protection: It is critical to ensure proper classification criteria under Washington law and FLSA to avoid penalties.

Classifying Exempt Employees Washington State

Employees must meet all three of the following requirements to be exempt from minimum wage and overtime laws in Washington:

The Salary Basis Test

The employee must receive a salary regardless of hours worked or work performed to be exempt.

The Salary Level Test

The employee must earn a minimum of $1302.40/week ($67,724.80/year) in order to be exempt from minimum wage and overtime laws.

Duties Test

The employee should perform specific job duties to qualify for exemption, which include but are not limited to:

Executive Exemption: The employee manages the enterprise or department and supervises the work of at least 2 employees.

Administrative exemption: Employee performs office or non-manual work related to directing the business operations with discretion and judgment.

Professional Exemption: The employee uses advanced knowledge from a specialized education or the application of creativity or talent.

Computer employee exemption: Systems analysts and programmers, as well as other specialized computer roles that fit into this designation.

Outside Sales Exemption: The exemption consists of activities directed toward generating sales or obtaining orders or contracts outside a business location.

Also read: How to hire an Outside Sales Representative?

Frequently Asked Questions About Exempt Employee Rights in Washington State

What Are the Basic Rights of Exempt Employees Washington State?

Minimum Wage:
Starting January 1, 2025:

• Small employers (≤ 50 employees): Must pay at least $1,332.80/week ($69,305.60/year)
• Large employers (51+ employees): Must pay at least $1,499.40/week ($77,968.80/year)
  The federal threshold is lower at $1,128/week, but Washington employers must follow the higher state rate.
• Part-time exempt employees must still earn the full weekly salary—no proration allowed.
• Exempt computer professionals (hourly): Must be paid at least $58.31/hour

Are Exempt Employees Washington State Exempt from Overtime?

Exempt salaried employees in Washington are not entitled to overtime compensation. An employee must fulfill certain job duty requirements outlined by state law in addition to the salary threshold to qualify for exemption.

Who Is Not Eligible for Overtime Compensation in Washington State?

Washington's overtime regulations will be based on employees' pay and the size of your employer as of January 1, 2025.

• If a worker earns more than $1,332.80 per week at a small business with 1–50 employees, they are exempt.
• The weekly threshold for larger companies with 51 or more employees is $1,499.40.
• This primarily pertains to white-collar jobs that pay well, such as professionals, administrators, and executives.

Other roles that are exempt include:

• Highly paid workers ($151,164+ annually)
• Professionals in computers ($58.31/hour or more)
• Seasonal workers, elected officials, seafarers, outside salespeople, and more

Additionally, state law excludes certain roles (such as casual labor or certain minors)

What Protected Leave and Breaks Are Exempt Employees Washington State Entitled To?

In Washington State, no, employers are not required to give exempt employees meals or rest periods. The state’s meal and rest period requirements primarily apply to non-exempt employees. While these provisions are not legally required for exempt employees, employers may choose to implement similar break policies for them.

• Ten-minute paid breaks for rest after every four hours of work
• 30-minute uninterrupted meal breaks for shifts longer than five hours
• Duty-free breaks are required, or the time must be compensated

It's important to note that if an employer provides breaks to exempt employees, they should ensure that these breaks are consistent with company policy and do not inadvertently affect the employees' exempt status under the Fair Labor Standards Act (FLSA).

Exempt workers may still be eligible for protected leave even though their employers are not obligated to provide vacation or holiday leave in the following situations:

• Complications of pregnancy
• Bonding between parents
• Leave for military spouses
• Recovery from domestic violence

Pay Deductions for Exempt Employees Washington State

Employers in Washington State can deduct the following from the pay of an exempt salaried employee:

• Taxes: Federal and state income taxes, Social Security, and Medicare.
• Court-Ordered Garnishments: Child support and other legal obligations.
• Benefit Recovery: Deductions for loans or benefits, such as food and lodging.
• Medical Expenses: For employer-covered medical costs unrelated to work.

Thus, Washington State law identifies and permits certain deductions only from an employee's last paycheck when collecting cash shortages, costs for damaged equipment, losses from dishonored checks or rejected credit card payments, and losses resulting from theft committed by the employee; however, employers are never allowed to deduct for the cost of lost equipment or theft from the regular salary of an exempt employee unless it is decreed by a court or is included in the final paycheck.

Benefits and Protections for Exempt Employees Washington State Under State Law

The benefits and protections applicable to exempt employees in Washington State include:

• Minimum Wage: Exempt employees qualify for pay above the federal minimum wage threshold, but they do not qualify for overtime.
• Workers' Compensation: Exempt employees qualify for workers' compensation benefits when they experience a work-related injury or illness.
• Protection against Discrimination: Exempt employees are protected against discriminatory acts relating to any employment based on race, color, creed, national origin, sex, pregnancy, marital status, age, sexual orientation, gender identity, veteran or military status, disability, or other characteristics.

Thus, exempt employees are protected from any unfair treatment in the workplace, whereas not entitled to any overtime pay.

Final Thoughts for Employers

Classifying exempt employees appropriately in Washington State is not only legally mandated, but also a measure of effective workforce management. In this way, ensuring that your employees qualify for the exemptions under the laws of both the state and the federal government protects an organization’s business from risk and builds trust and credibility within the workplace.

Exempt status is not only about being on salary; it involves satisfying specific duties tests and meeting salary thresholds. Misclassifications can result in expensive penalties, tarnishing a good company reputation, and decreased morale among employees.

By keeping up to date with developments and bringing their policies in line with changing labor laws in Washington, employers can ensure that they are complying with the law while also showing a sense of responsibility toward ethical employment practices and sustainability of their own business. When unsure, HR or legal counsel should be consulted to protect the business and sustain its workforce.

Smarter Sourcing for Exempt Roles

The process of exempt employee hiring goes beyond just matching resumes; it is more about aligning job duties and salary thresholds to long-term fit. Thus, a product like EasySource can support this process by promoting efficiency, speeding up the process of finding qualified candidates, and ensuring compliance with evolving role requirements.

If you're rethinking how you source for exempt, it might be worth seeing how a product like EasySource fits into that strategy.

Read more on how EasySource helps streamline the search for exempt talent.