Starting on January 1, 2025, Washington State’s minimum wage will rise to $16.66 per hour, a 2.35% increase from 2024.

The pay threshold for an employee to be exempt also increases. In Washington, this is a factor of the minimum wage and will increase to $1,332.80/week (or $69,305.60/year) for small employers (1-50 employees) and $1,499.40/week ($77,968.80/year) for large employers (51+ employees). Anyone paid below these thresholds must be nonexempt and paid overtime regardless of their title or job duties.

Check out the Washington State Department of Labor & Industries (L&I) website for a salary threshold implementation schedule. As always, in addition to meeting the pay threshold, an exempt employee must meet a duties test and be paid the same amount weekly regardless of hours worked.

Seattle, SeaTac, Tukwila, Renton, Bellingham, and Burien have (or will have) higher minimum wages than the state requires. 

As a nonprofit, you are probably in a pickle: How do you balance keeping up with these pay increases while paying for other necessary expenses? You essentially have two options:

1. Move your employees up to the new salary thresholds, or
2. Convert employees to be non-exempt (while making sure they receive additional benefits that come with being non-exempt).

We are currently seeing a trend within the sector of organizations doing the latter. So, here's what we recommend you do:

• Make sure you have up-to-date and accurate job descriptions.
• Visit the U.S. Department of Labor (DOL) website for helpful guidelines for determining exempt status. A starting point is to review this DOL fact sheet on exemptions under the FLSA (Fair Labor Standards Act).
• If you need further guidance, tap our HR Quick Consults service by sending an email to hrconsults@501commons.org. You can receive assistance for only $25 per 15-minute increment. We can generally respond within 72 hours.

Need HR assistance on a deeper level? 501 Commons team of HR experts worked with more than 150 organizations in 2024. We provide HR Consulting Services and an HR Partners program. The partners program provides ongoing support for hiring, employee relations, HR policies, compensation, performance management, and more.

The program starts at $1200/month and is much less expensive than hiring internal HR staff. Begin a conversation with us today.