A Note from Small Biz Andrew, Your Friend at L&I
Winter greetings and sincere wishes for a very merry 2021, my business friends.
I hope that all of you kept your left leg off the ground during the New Year's countdown, because I really want us all to start off on the right foot this year.
The triple-decker carousel of nightmares that has been 2020 may be behind us, but it has left us all dizzily striding into 2021. While my wishes for the ever popular sitcom-staple "the events from last season were all a bad dream that we now get to wake up from" did not materialize at the stroke of midnight, a new year always brings new changes.
New goals.
New hopes and aspirations.
New personal resolutions to blissfully abandon around February.
It also brings many new changes to state rules and regulations. Small Biz Andrew may not be able to help you with your New Year's resolutions, but he aims to make the new regulatory changes more accessible.
Here are just a few of the topics we're resolving to share in this New Year newsletter:
- New minimum wage and overtime-exempt salary thresholds take effect
- No increase for average workers' comp rates
- The extension of our workers' comp premium assistance program
- New and expanded webinar offerings
- New ways to spruce up the workplace, like a fetching new required workplace poster and a free safety and health calendar that will make you the envy of all your colleagues
As always, you can count on Small Biz Andrew to season your newsletter with business jests that will have you looking to the year ahead with many pun-induced eye rolls.
Your friendly friend at L&I,
Andrew Bryan
Labor & Industries' Asst. Small Business Liaison
New Year, New Rules and Requirements
Your guide to the changes your business needs to know for 2021.
The following changes took effect on January 1, 2021.
*Exemption also requires a duties test. See article below.
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Non-compete agreement restrictions are adjusted annually by the Consumer Price Index.
- Employee Threshold: $101,390
- Independent Contractor Threshold: $253,475
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Prohibited employment restrictions are tied to the minimum wage increase. Employers are not permitted to restrict employees’ outside employment or self-employment unless they are paid more than two times the minimum wage.
- 2021 Threshold: $27.38 per hour, or $56,950.40 per year
- Isolated worker protections expanded to affect employers in all the following industries (see RCW 49.60.515 for requirements, which include a panic button, adopting a sexual harassment policy, providing mandatory training, providing a resource list, and more):
- Hotels
- Motels
- Retail
- Security Guard Services
- Property Services Contractors (including Commercial Janitorial Services)
- The required “Your Rights as a Worker” poster has been updated and the new version must be displayed.
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Small Biz Andrew's Business Jests #1
Fun fact: Before he became Small Biz Andrew, Andrew was an archaeologist in the central Andes of Peru. He left the profession, however, once he realized his career was in ruins.
No Increase for Average Workers' Comp Rates in 2021
The average workers' compensation premium rate did not increase in 2021. It's the fourth year in a row with no overall increases. Last year, there was a 0.8 percent decrease in the average amount employers paid for the coverage. L&I cut rates by five percent in 2019 and 2.5 percent in 2018.
Although the average rate hasn't changed, individual employer rates may have gone up or down depending on the type of industry and any annual changes to the employer's experience factor.
Every fall, L&I determines proposed rates for the following year by looking closely at several factors, including expected workers' compensation payouts, the size of the contingency reserve, wage inflation, and other financial indicators. Following a public process, they are adopted as proposed or revised through the process.
Employers and workers pay into the workers' compensation system to help cover the costs of providing wage and disability benefits for injured workers, as well as medical treatment of injuries and illnesses. Workers will pay on average about a quarter of the premium, similar to the percentage paid in 2020.
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New Overtime Salary Thresholds Now in Effect
Business owners should be aware the minimum salary threshold for overtime exempt employees increased on Jan. 1, 2021.
For small businesses (1-50 employees), employees who are exempt from the State Minimum Wage Act must earn at least 1.5 times the state minimum wage of $13.69/hour. That equals $821.40/week or $42,712.80/year.
For large businesses (51 and more employees), exempt employees must earn at least 1.75 times the minimum wage, or $958.30/week ($49,831.60/year).
The threshold increases are part of the changes made by L&I to rules pertaining to the state Minimum Wage Act that took effect July 1, 2020. The changes cover employees classified as executive, administrative, and professional, as well as computer professionals and outside salespeople.
In general, to qualify as exempt, a worker must meet the job duties requirements and earn a salary that meets or exceeds a minimum threshold.
There were two key elements to the updates:
Job duties tests: L&I reduced the number of tests from two to one per exemption category, and the language now more closely aligns with federal standards.
Minimum salary thresholds: Rather than a straight dollar figure, the threshold is a multiplier of the state minimum wage. This prevents the threshold from becoming outdated over time. Prior to these changes, the last time the state threshold was updated was back in 1976. Under the implementation schedule, the salary threshold will rise on Jan. 1 of each year until it reaches 2.5 times the state minimum wage in 2028. Small employers have a slower phase-in schedule.
There is a separate implementation schedule for computer professionals paid by the hour.
To help employers, L&I's Employment Standards Program has created a number of resources to explain the updates. They can be found at https://www.lni.wa.gov/overtimerulemaking. Among the tools available are an eLearning module that explains the changes and includes a tool that can help determine if an employee likely qualifies as exempt or not. The program also has a page with answers to commonly asked questions, and a resource center that includes webinar information, fact sheets and links to technical documents. L&I is offering monthly Overtime Exemption Training Session webinars to help explain the rule updates and answer questions.
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Small Biz Andrew's Business Jests #2
I had an insufferable coworker that used to pester me with bird puns...
Until I realized that toucan play that game.
Non-Compete Agreements: New Earnings Thresholds for 2021
Washington law governs when a non-competition agreement may be considered valid and enforceable
One aspect of the restrictions in Washington’s non-competition law is related to earnings. Only employees or independent contractors who earn more than the thresholds established by law can be held to non-competition agreements. If an employee or independent contractor has earnings less than the threshold, the non-compete agreements are considered void and unenforceable under RCW 49.62. These thresholds are established in RCW 49.62.020 (for employees) and RCW 49.62.030 (for independent contractors).
Pursuant to RCW 49.62.040, L&I must adjust these thresholds for inflation each year. Earnings thresholds are available on the Non-Compete Agreements page of the L&I website. The adjustments for 2021 are below.
| Statutory Dollar Adjustments |
Pre-Adjusted (2020) Thresholds |
2021 Thresholds |
| RCW 49.62.020 |
$ 100,000.00 |
$101,390.00 |
| RCW 49.62.030 |
$ 250,000.00 |
$253,475.00 |
Other elements of the non-competition agreement law
In addition to the earnings thresholds, the law also establishes other restrictions on non-competition agreements in Washington. These other restrictions include:
- A provision in a non-competition agreement signed by a Washington-based employee or independent contractor is void and unenforceable when the agreement requires the worker to adjudicate the agreement outside of Washington and when the agreement denies the worker protections established by the law. See RCW 49.62.050.
- Franchisors may not prevent franchisees from hiring employees of the franchisor or other franchisees of the same franchisor. See RCW 49.62.060.
- Employers are generally not permitted to prohibit employees earning less than twice the state minimum wage from having additional employment; this restriction is subject to some limitations. See RCW 49.62.070.
Violations of the law
Under Washington’s non-competition agreement law, the Attorney General’s Office may pursue relief for violations of the law. Aggrieved individuals may also pursue relief on their own through the courts.
To file a complaint or if you have questions about this law, contact the Attorney General’s Office or call 206-587-5510. L&I does not have enforcement authority under this law.
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Program Extended to Help Employers Pay Workers' Comp Premiums
L&I's Employer Assistance Program (EAP) remains in place to help businesses impacted by COVID-19
Any business that has been financially impacted by the COVID-19 pandemic may qualify for the Employer Assistance Program and arrange a payment plan for their workers' compensation premium. Businesses can request their payment be deferred for up to 90 days or ask for a 90-day payment plan. Either way, the delayed payments will be penalty- and interest-free.
How does the Employer Assistance Program work?
- L&I waives late penalties and interest if qualifying businesses pay their premiums within 90 days. Penalties and interest may be applied for longer payment periods.
- In some cases, the payment plan may be renegotiated if a business goes deeper into financial distress.
I already enrolled in the program in a previous quarter. Do I still need to do anything?
You must make a new request each quarter, in writing or via email, to be enrolled in the program. The program has been available for the first, second, third, and fourth quarters of 2020. Even if you have used the program for a previous quarter, you must make a new request to defer fourth quarter payments.
How do I take advantage of the Employer Assistance Program?
- File your quarterly report no later than January 31, or as soon as possible, and pay what you can at the time you file.
- Contact Collections Education & Outreach by email at DialerCollections@Lni.wa.gov. Include your L&I account ID in your request. You can also reach Collections by calling 1-800-301-1826.
If you need additional assistance, contact:
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Small Biz Andy's Business Jests #3
My father always used to say, "Out with the old and in with the new."
A lovely man, but a terrible antiques dealer.
Webinars Galore: Online Offerings and Content Expanded to Assist Employers Remotely
As restrictions on gatherings continue, Small Business Liaisons are here to offer more and new online courses
As the coronavirus continues to prevent live workshops, various outlets have increased webinar offerings or added new courses including the Small Business Liaison Office at L&I, L&I's Employment Standards Program, the statewide Small Business Liaison Team, and more.
Here is a brief summary of the webinar offerings coming up, with more detail on select series below. Click on any of the titles to register.
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L&I Essentials for Business: Led by yours truly, Small Biz Andrew, these provide a 90-minute broad overview of what your business needs to know about L&I requirements.
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L&I Overtime Exemptions Training Sessions: Presentation and Q&A focused on the new overtime rules that took effect.
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L&I Equal Pay and Opportunities Act: Educational overview of this relatively new law and the employer resources that are available.
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L&I Hiring an "Independent Contractor" and Avoiding Prime Contractor Liability: Workshop providing resources for hiring subcontractors and avoiding unexpected costs.
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L&I Employer Guide to Workers' Rights: Learn about workplace rules and regulations like wage requirements, tracking hours, wages, paid sick leave, and more.
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Everything You Want to Know About Your L&I Account: A detailed overview of your workers' compensation account that covers risk classes, rates, claims, filing, and resources.
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Small Business Requirements and Resources (SBRR) COVID-19 Impact: Multiple state agencies provide an overview of COVID-19 rules, responses, and resources.
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Small Business Requirements and Resources (SBRR) Start a Business: Multiple state agencies team up to guide you through the steps to starting a business in Washington.
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Small Business Requirements and Resources (SBRR) Grow a Business: Multiple state agencies team up to cover the requirements associated with becoming an employer.
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ScaleUp: Resiliency training for small businesses for spurring growth in a pandemic.
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EHS International: New COVID-19 training series for small businesses.
L&I "Essentials for Business" webinars
These webinars are dedicated to sharing the latest L&I requirement updates, resources, and ways to protect your business and workforce, including COVID-19 guidance.
You will learn:
- The essentials about workers' compensation, quarterly reporting, what to do if your employee is injured, workplace safety and health requirements, wage and hour laws, and contractor registration rules
- How to access a range of L&I resources designed to help your business save time and money
- Various ways L&I partners with you to keep your workforce safe and healthy
Upcoming monthly L&I Essentials for Business Webinars will be held on the following dates:
Webinars are also available in Spanish on a quarterly schedule on the following dates:
View the entire 2021 schedule on our Workshops & Training Center page.
Small Business Requirements and Resources (SBRR) COVID-19 Impact webinar
This webinar, provided by multiple state agencies, offers a quick overview of some of the state responses, resources, and other impacts on small businesses as a result of the COVID-19 pandemic. Learn about:
- General workplace safety and health requirements, including those regarding employee and customer face masks
- Workers’ compensation insurance impacts and premium reporting
- Paid Sick Leave, and Family and Medical Leave
- Department of Revenue tax returns and outstanding balances
- Unemployment impacts such as pandemic unemployment benefits, job search, return to work, and refusal to work
- And more...
SBRR COVID-19 Impact Webinars will be held on the following dates:
No-cost registration. Limited capacity. View the schedule to register.
Small Business Requirements and Resources (SBRR) New Offerings
In addition to the COVID-19 Impact Webinars, the Small Business Liaison Team is debuting a new series of webinars designed to help guide businesses at various stages of their development. The SBRR Start a Business Webinars will provide an introduction and overview for people looking to start their first business, focusing on the process of developing and registering your Washington-based business. For those of you looking to expand your current business with employees, the SBRR Grow Your Business Webinars will help guide you through the requirements and the resources available to assist you.
SBRR Start a Business Webinar Dates:
- March 2 (Tuesday), 9 to 10 AM
- April 14 (Wednesday), 2 to 3 PM
SBRR Grow a Business Webinar Dates:
- March 11 (Thursday), 2 to 3 PM
- May 11 (Tuesday), 9 to 10 AM
COVID-19 Requirements & Best Practices Webinar Series
EHS-International, Inc. (EHSI), one of L&I’s partners for employer outreach and education, is providing a series of free webinars February through May, 2021 to help employers increase their knowledge of COVID-19 while learning how to protect their workers from the virus. The series is designed to help businesses across Washington state navigate COVID-19 health and safety protocols. Topics will include workplace guidance for indoor and outdoor environments, the right mask for the job, ventilation, barriers and engineering for COVID-19 prevention, safety resources, tips for reopening when it is allowed, and more. Each webinar will include time for participant questions. For more information, go to www.ehsintl.com.
And don't forget the Help for Small Business page, designed by the Small Business Liaison Office to be a one-stop shop for your L&I needs.
For more information, contact the L&I Small Business Liaison Office at 1-800-987-0145 or SmallBusiness@lni.wa.gov.
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Small Biz Andy's Business Jests #4
I'm thinking of pursuing a career in crowd estimation.
I wonder how many people are in that field.
New Updated Workplace Rights Poster Available
L&I's Employment Standards Program has updated the required workplace rights poster, including a change in the format to make it easier for businesses to print the poster themselves.
“Your Rights as a Worker” is one of three L&I posters all businesses in Washington are required to display in their workplace where employees can see and read them. All the posters are available from the Washington State Department of Labor & Industries for free.
While minor content changes were made to account for changes in legislation, the biggest change in the poster is the new format.
The poster is now a printer-friendly 11 inches by 17 inches, with separate posters in English and Spanish. The English and Spanish posters were combined on the previous version of the poster that measured 26 inches by 19 inches. There also are 8.5-inch by 11-inch versions translated into seven other languages.
“We feel the new format will make it easier for a business to print their own version of the poster should they need to replace an out-of-date poster, or one gets damaged,” said Joshua Grice, program manager for Employment Standards. “The old format was just too large to print on most printers and was impractical to view on a mobile device.”
While there is no requirement to display a poster in Spanish, L&I encourages businesses with Spanish-speaking employees, even if they speak English, to display the English and Spanish versions. The same applies to other languages.
You can learn more about what posters are required to be displayed at L&I’s workplace poster web page.
How to get your free posters
There are several ways you can request any of L&I’s required workplace posters, or a complete set:
Other posters may be required
In addition to L&I’s required poster, some other state and U.S. government agencies also have mandatory posters.
Washington State Employment Security Department: https://esd.wa.gov/about-employees/forms-and-publications
Washington State Human Rights Commission: https://www.hum.wa.gov/publications
U.S. Department of Labor and U.S. Equal Employment Opportunity Commission: https://webapps.dol.gov/elaws/posters.htm
U.S. Affordable Care Act: https://www.dol.gov/agencies/ebsa/laws-and-regulations/laws/affordable-care-act/for-employers-and-advisers/coverage-options-notice
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Small Biz Andy's Business Jests #5
The car dealership nearby just doubled in size.
Now they can offer a whole lot more.
Who's Ready to Spot the Hazards with L&I's Free 2021 Calendar?
The new calendars are free to all Washington state businesses while supplies last
The 2021 Workplace Safety and Health calendar features our partnership with WorkSafeBC and provides a fun way to promote hazard awareness and finding/fixing similar hazards in your workplace.
At the start of each month, beginning January 2021, we’ll update this page and include the current month’s “Spot The Hazards” photo, along with links to relevant resources, to help you with hazard awareness, employee training, safety meetings, and finding and fixing similar hazards in your workplace. We’ll also include a link to WorkSafeBC’s web page containing an online interactive version of the photo for your use.
Email us at EyeOnSafety@Lni.wa.gov or follow us on Facebook and Twitter and share how you’re using the photos in your workplace to engage your workers and bring about hazard awareness and injury/illness prevention. #SpotTheHazards @WorkSafeBC @Lniwa
How can I get a calendar?
The calendars are free to Washington state businesses while supplies last.
Note: Calendars are not currently available for pick-up from your local L&I office due to offices remaining closed to the public in accordance with COVID-19 rules.
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