State vs. Federal “White-collar” Overtime

Common questions about state vs. federal "white-collar" (management) overtime pay

The following information applies only to the executive, administrative, professional, computer-related and outside sales jobs that are exempt from minimum wage and overtime requirements under both state and federal laws.

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Overtime exemptions are determined on a case-by-case basis, so it is important to review the details about the particular circumstances and compare them against the federal rules. Please check with the Washington State Department of Labor & Industries Employment Standards office, the U.S. Department of Labor or a qualified consultant to determine how the specific circumstances are affected.

Here are some basic guidelines:

  • Businesses must comply with both state and federal overtime rules. Where differences exist between Washington State and new federal overtime rules, the business must follow the rule that is most favorable to the worker.

    In other words…

    If, prior to Aug. 23, 2004 (when the new federal regulations took effect), a business was required to pay overtime to a worker, in most cases that worker still must be paid overtime now. That worker’s status likely will not change because state regulations, which are very similar to the old federal regulations, have not changed.

    If, prior to Aug. 23, 2004, the business was not required to pay overtime to a salaried worker, and that worker earns less than $455 per week, the business should review the status of that worker under the new federal regulations by checking with the U.S. Department of Labor at their toll-free number: 1-866-487-9243.

  • Washington State overtime rules generally follow the federal overtime rules in effect prior to August 23, 2004. Because the federal rules changed, there are some cases in which the federal rules are more favorable to workers, and some in which the state rules are more favorable.
  • The federal rule changes affect white-collar workers only. Traditional blue-collar workers who perform manual labor, even if highly skilled, must be paid overtime under both state and federal rules.
  • Workers not affected by these overtime-exemption rules include construction trades, production workers, probation and parole officers, and park rangers. The new rules also do not apply to first responders such as police, firefighters, paramedics, EMTs, ambulance personnel, rescue workers, and HAZMAT workers. These workers must actually perform the physical duties required, such as fighting fires, solving crimes, helping crime or accident victims, etc.

Washington State has separate rules for determining who can be considered exempt from overtime-pay requirements. Prior to the new federal rules, state and federal requirements were nearly identical. The federal rules have, in some cases, changed who in Washington State can be considered exempt from overtime. Notable differences include:


Minimum salary requirement:

  • Washington's minimum salary for overtime-exempt workers is $250 per week.
  • The new federal rules raise the federal minimum. It previously was as little as $155 per week, but now is $455 per week.

The new federal minimum salary of $455 per week will apply to most workers in Washington.

Please remember that the minimum salary requirement for exempting a worker from overtime is only ONE FACTOR in determining whether a worker is exempt. Other requirements must be met in addition to the minimum salary, and state requirements in those areas may be the most favorable to your particular worker even though you use the federal minimum salary standard. Make sure to check both state and federal requirements.


$100,000-per-year salary cap:
Under the new federal rules, white-collar positions paying more than $100,000 per year are exempt from overtime pay if the worker has performed at least one duty in an executive, administrative, or professional function job. Washington does not have such a requirement, so state regulations are the most favorable to workers in this case.

To learn more about the multi-part federal definitions for what constitutes executive, administrative, and professional duties, please go to the U.S. Department of Labor site on the Internet at: http://www.dol.gov/whd/regs/compliance/fairpay/fs17a_overview.pdf.


Outside sales workers:
Under the new federal rules, an outside sales worker who is exempt from overtime is defined as one who:

  • Customarily and regularly is engaged away from his/her employer's place or places of business;
  • Has a primary duty of making sales or obtaining orders or contracts for services or the use of facilities for which the client or customer will pay a consideration.

Washington State rules define an overtime-exempt outside sales worker as one who:

  • Is customarily and regularly engaged away from his/her employer's place or places of business;
  • Is engaged in making sales, obtaining orders or contracts for services or use of facilities or demonstrating products or equipment for sale;
  • Is paid a guaranteed salary, commission, or fee payment (or combination);
  • Controls his/her total hours worked each week;
  • Spends no more than 20 percent of his/her time doing inside office work not related to outside sales.

Yes. In addition to overtime requirement changes, the federal rule also affects deductions from salary that a business can impose upon a worker who violates organizational policies on workplace safety:

  • The federal rule allows an employer to impose unpaid disciplinary suspensions of one or more full days for workplace-conduct rule infractions.
  • Washington State allows an unpaid disciplinary suspension in increments of less than one week only for violations of safety rules of major significance. Unpaid disciplinary suspensions for non-major safety violations cannot be in less than full-week increments.

Interpretation of the federal overtime rules: The federal government has fact sheets addressing frequent questions about the new rule. They can be found at www.dol.gov/fairpay, or by contacting the USDOL toll free at 1-866-487-9243 for detailed information.

State overtime rules should apply if the state rule is most favorable to the worker.
If you have detailed questions about how to determine this, you are welcome to:



Download or print these helpful fact sheets:

Acrobat PDF file New Federal Overtime Regulations - 2004: How they apply to Washington State (37 KB PDF) - Gives the same general information about the effect of the new federal overtime rules in Washington as discussed on this Web page.

Acrobat PDF file Comparison: Washington State and new federal overtime rules (44 KB PDF) - A chart providing more detailed information about the most notable differences between state overtime rules and the new federal rules.


For more detail, see L&I Admininistrative Policies:
Acrobat PDF file Minimum Wage Act Applicability (ES.A 1) (150 KB PDF)
- Outlines when and to whom the state Minimum Wage Act applies. State overtime laws are included in the Minimum Wage Act.
Acrobat PDF file Overtime (ES.A.8.1) (161 KB PDF)
- Interprets when overtime is due and how it is paid, and when it is not due.
Acrobat PDF file How to Compute Overtime (ES.A.8.2) (57 KB PDF)
Acrobat PDF file Salary Basis for White Collar Workers (ES.A.9.1) (106 KB PDF)
- Defines what constitutes a salaried worker.
Acrobat PDF file Retail or Service Exception (ES.A.10.1) (25 KB PDF)
- Explains how a retail or service employee could be exempt from overtime if the position meets specific circumstances.
Acrobat PDF file Q&A on Retail/Service Exception (ES.A.10.2) (16 KB PDF)
Acrobat PDF file Examples of Retail/Service Businesses (ES.A.10.3) (21 KB PDF)

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