Category Archives: Worker Pay

Worker Pay

Tips and Service Charges – Rules for Payment to Workers

The Department of Labor & Industries (L&I) has released the final version of the tips, gratuities, and service charges policy. You can find it on the Workplace Rights/Employment Standards Administrative Policies webpage. This policy includes updates based on feedback received on two draft versions last fall.

I-1433 created new requirements in the Washington Minimum Wage Act (RCW 49.46.020(3)) for employers to pay tips, gratuities, and service charges to their employees. During the rulemaking process for I-1433, L&I committed to developing administrative policies like this one and providing opportunities for input. These policies are intended to help employers understand how to interpret and apply the law.

The final policy language defines tips, tip pools and service charges and outlines requirements for payment to workers.  The policy also adds the requirement that facilities that add a mandatory tip or service charge disclose to their customers the amount of the charge that will be shared with the worker, if any.  This information must be presented in a restaurant menu and/or on an invoice or receipt. 

Examples of appropriate disclosure statements:

Restaurant menu

  • A service charge of ___% / $___ will be added to your bill. ___% of this service charge is paid to the employee or employees who served you today.

OR

  • A service charge of ___% / $___ will be added to your bill. 100% of this service charge is retained by [Business Name].

OR

  • A mandatory gratuity of ___% / $___ will be added to your bill for parties of ___ or more. ___% of this service charge is paid to the employee or employees who served you today.

OR

  • A mandatory gratuity of ___% / $___ will be added to your bill. 100% of this mandatory gratuity is retained by [Business Name].

Photo by Alan Light on Foter.com / CC BY

 

Worker Pay

Washington State Average Wage Neared $61,900 in 2017

Washington’s average annual wage grew by 5.0 percent in 2017 to $61,887, according to the state Employment Security Department—representing the largest percentage increase year over year since 2007.

The average weekly wage rose from $1,133 in 2016 to $1,190 in 2017. These figures include only those wages that are covered by unemployment insurance.

Much of the increase was driven by a 7.7 percent increase in total earnings, which grew by nearly $14.1 billion in 2017. Overall, the average number of workers in Washington covered by unemployment insurance grew by just over 81,790 in 2017.  

The industries with the largest average wage growth in 2017 were retail trade, up 14.5 percent; information, up 8.2 percent; and accommodation and food services, up 6.9 percent.

The average annual wage is used to calculate unemployment benefits for jobless workers. The minimum weekly unemployment benefit, calculated at 15 percent of the average weekly wage, will increase by $9 to $178, for new claims opened on or after July 1. At the same time, the maximum weekly benefit, which is the greater of $496 or 63 percent of the average weekly wage, will increase by $36 to $749. 

Currently, about 20 percent of unemployment insurance claims are paid the maximum benefit amount, and 10 percent receive the minimum.

In addition to unemployment benefits, the average annual wage is used in computing employers’ unemployment taxes. Beginning in 2019, employers will pay unemployment taxes on the first $49,800 paid to each employee—up from $47,300 in 2018. 

The state average wage also is used by the Department of Labor & Industries in calculating worker’s compensation benefits.

Web link: Employment Security Department – www.esd.wa.gov

Photo by stevendepolo on Foter.com / CC BY