AN ACT Relating to the state minimum wage; amending RCW 49.46.010, 49.46.020, and 49.12.121; and providing an effective date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1. Section 1, chapter 294, Laws of 1959 as last amended by section 364, chapter 7, Laws of 1984 and RCW 49.46.010 are each amended to read as follows:

As used in this chapter:

(1) "Director" means the director of labor and industries;

(2) "Wage" means compensation due to an employee by reason of employment, payable in legal tender of the United States or checks on banks convertible into cash on demand at full face value, subject to such deductions, charges, or allowances as may be permitted by regulations of the director;

(3) "Employ" includes to permit to work;

(4) "Employer" includes any individual, partnership, association, corporation, business trust, or any person or group of persons acting directly or indirectly in the interest of an employer in relation to an employee;

(5) "Employee" includes any individual employed by an employer but shall not include:

(a) ((Any individual employed (i) on a farm, in the employ of any person, in connection with the cultivation of the soil, or in connection with raising or harvesting any agricultural or horticultural commodity, including raising, shearing, feeding, caring for, training, and management of livestock, bees, poultry, and furbearing animals and wildlife, or in the employ of the owner or tenant or other operator of a farm in connection with the operation, management, conservation, improvement, or maintenance of such farm and its tools and equipment; or (ii) in packing, packaging, grading, storing or delivering to storage, or to market or to a carrier for transportation to market, any agricultural or horticultural commodity; and the exclusions from the term "employee" provided in this item shall not be deemed applicable with respect to commercial canning, commercial freezing, or any other commercial processing, or with respect to services performed in connection with the cultivation, raising, harvesting, and processing of oysters or in connection with any agricultural or horticultural commodity after its delivery to a terminal market for distribution for consumption;

~~(b) Any individual employed in domestic service in or about a private home;~~

~~(c)~~)) Any individual (i) employed as a hand harvest laborer and paid on a piece rate basis in an operation which has been, and is generally and customarily recognized as having been, paid on a piece rate basis in the region of employment; (ii) who commutes daily from his or her permanent residence to the farm on which he or she is employed; and (iii) who has been employed in agriculture less than thirteen weeks during the preceding calendar year;

(b) Any individual employed in casual labor in or about a private home, unless performed in the course of the employer's trade, business, or profession;

(c) Any individual employed in a bona fide executive, administrative, or professional capacity or in the capacity of outside salesman as those terms are defined and delimited by regulations of the director. However, those terms shall be defined and delimited by the state personnel board pursuant to chapter 41.06 RCW and the higher education personnel board pursuant to chapter 28B.16 RCW for employees employed under their respective jurisdictions;

(d) Any individual engaged in the activities of an educational, charitable, religious, state or local governmental body or agency, or nonprofit organization where the employer-employee relationship does not in fact exist or where the services are rendered to such organizations gratuitously. If the individual receives reimbursement in lieu of compensation for normally incurred out-of-pocket expenses or receives a nominal amount of compensation per unit of voluntary service rendered, an employer-employee relationship is deemed not to exist for the purpose of this section or for purposes of membership or qualification in any state, local government or publicly supported retirement system other than that provided under chapter 41.24 RCW;

(e) Any individual employed full time by any state or local governmental body or agency who provides voluntary services but only with regard to the provision of the voluntary services. The voluntary services and any compensation therefor shall not affect or add to qualification, entitlement or benefit rights under any state, local government, or publicly supported retirement system other than that provided under chapter 41.24 RCW;

(f) Any newspaper vendor or carrier;

(g) Any carrier subject to regulation by Part 1 of the Interstate Commerce Act;

(h) Any individual engaged in forest protection and fire prevention activities;

(i) Any individual employed by any charitable institution charged with child care responsibilities engaged primarily in the development of character or citizenship or promoting health or physical fitness or providing or sponsoring recreational opportunities or facilities for young people or members of the armed forces of the United States;

(j) Any individual whose duties require that he or she reside or sleep at the place of his or her employment or who otherwise spends a substantial portion of his or her work time subject to call, and not engaged in the performance of active duties;

(k) Any resident, inmate, or patient of a state, county, or municipal correctional, detention, treatment or rehabilitative institution;

(l) Any individual who holds a public elective or appointive office of the state, any county, city, town, municipal corporation or quasi municipal corporation, political subdivision, or any instrumentality thereof, or any employee of the state legislature;

(m) All vessel operating crews of the Washington state ferries operated by the department of transportation;

(n) Any individual employed as a seaman on a vessel other than an American vessel.

(6) "Occupation" means any occupation, service, trade, business, industry, or branch or group of industries or employment or class of employment in which employees are gainfully employed.

Sec. 2. Section 2, chapter 294, Laws of 1959 as last amended by section 2, chapter 289, Laws of 1975 1st ex. sess. and RCW 49.46.020 are each amended to read as follows:

(1) Every employer shall pay to each of his or her employees who ((~~have~~)) has reached the age of eighteen years wages at a rate of not less than ((~~one dollar~~)) two dollars and ((~~sixty~~)) thirty cents per hour except as may be otherwise provided under ((subsections (2) through (7) of this section or as otherwise provided under this chapter: PROVIDED, That beginning the calendar year 1974, the applicable rate under this section shall be one dollar and eighty cents per hour, and beginning with September 1, 1975 the applicable rate under this section shall be two dollars and ten cents an hour, and beginning the calendar year 1976 the applicable rate under this section shall be two dollars and thirty cents an hour)) this section. The minimum wage for employees under the age of eighteen years shall be seventy-five percent of the minimum wage payable under this section to persons eighteen years of age and older.

(2) ((Any individual eighteen years of age or older, unless exempt under the provisions of section 1(5)(k)(8) of this 1975 amendatory act, employed by the state, any county, city, town, municipal corporation or quasi municipal corporation, political subdivision, or any instrumentality thereof shall be paid wages beginning with September 1, 1975, at a rate of not less than two dollars an hour, and beginning the calendar year 1976 at a rate of not less than two dollars and twenty cents an hour, and beginning the calendar year 1977 at a rate of not less than two dollars and thirty cents an hour.

(3) Any individual eighteen years of age or older engaged in performing services in a nursing home licensed pursuant to chapter 18.51 RCW, shall be paid wages beginning with September 1, 1975, at a rate of not less than two dollars and ten cents an hour, and beginning the calendar year 1976, at a rate of not less than two dollars and twenty cents an hour, and beginning the calendar year 1977, at a rate of not less than two dollars and thirty cents an hour.

(4) Any individual eighteen years of age or older engaged in performing services in a hospital licensed pursuant to chapter 70.41 RCW, or chapter 71.12 RCW, shall be paid wages beginning with September 1, 1975, at a rate of not less than two dollars and ten cents an hour, and beginning the calendar year 1976, at a rate of not less than two dollars and twenty cents an hour, and beginning the calendar year 1977 at a rate of not less than two dollars and thirty cents an hour.

(5) Any individual eighteen years of age or older employed in a retail or service establishment and who is so employed primarily in connection with the preparation or offering of food or beverages for human consumption, either on the premises, or by such services as catering, banquet, box lunch, or curb or counter service, to the public, to employees, or to members or guests of members of clubs shall be paid wages beginning with September 1, 1975, at a rate of not less than two dollars an hour, and beginning the calendar year 1976, at a rate of not less than two dollars and twenty cents an hour, and beginning the calendar year 1977, at a rate of not less than two dollars and thirty cents an hour)) (a) Beginning July 1, 1988, through December 31, 1988, the state minimum wage shall be three dollars and thirty-five cents per hour.

(b) Beginning January 1, 1989, through June 30, 1990, the state minimum wage shall be three dollars and seventy-five cents per hour.

(c) Beginning July 1, 1990, the state minimum wage shall be established as of July 1 of each year as provided in this section. Beginning January 1, 1989, and each year thereafter, the office of financial management shall review the adequacy of the state minimum wage. In conducting this review the office shall consider, but not be limited to, the following factors: The federal minimum wage, the rate of inflation since the most recent adjustment under this subsection, and current federal poverty guidelines. The office shall make recommendations concerning the state minimum wage, based on the adequacy of the state minimum wage considering these factors, to the governor. Prior to the start of the 1990 regular legislative session, and each regular session thereafter, the governor shall issue an executive order establishing the state minimum wage for the twelve-month period beginning on the following July 1. The order shall be filed with the state code reviser for publication in the next available issue of the Washington state register in compliance with RCW 34.08.020, and in the Washington state administrative code, as appropriate. By majority vote of both houses, the legislature may veto the governor's action. If the legislature vetoes the governor's action, the state minimum wage for the previous year shall remain in effect.

(3) In addition to any other penalty provided by law, the director may assess a civil penalty against any employer who pays or agrees to pay wages at a rate less than the minimum rate required under this section or RCW 49.46.060. The civil penalty shall be the greater of: (a) One thousand dollars, or (b) the full amount of the applicable wage rate for employees paid less than the applicable rate, plus the full amount of the applicable wage rate for such employees less the amount actually paid to such employees. The director shall assess penalties under this subsection after a hearing in accordance with chapter 34.04 RCW and all penalties paid shall be deposited in the general fund and used solely for the administration of this chapter.

Sec. 3. Section 15, chapter 16, Laws of 1973 2nd ex. sess. and RCW 49.12.121 are each amended to read as follows:

The committee, or the director, may at any time inquire into wages, hours, and conditions of labor of minors employed in any trade, business or occupation in the state of Washington and may adopt special rules for the protection of the safety, health and welfare of minor employees((~~, such minimum wages not to exceed the state minimum wage as prescribed in RCW 49.46.020, as now or hereafter amended~~)). The minimum wage for minors shall be as prescribed in RCW 49.46.020. The committee shall issue work permits to employers for the employment of minors, after being assured the proposed employment of a minor meets the standards set forth concerning the health, safety and welfare of minors as set forth in the rules and regulations promulgated by the committee. No minor person shall be employed in any occupation, trade or industry subject to this 1973 amendatory act, unless a work permit has been properly issued, with the consent of the parent, guardian or other person having legal custody of the minor and with the approval of the school which such minor may then be attending.

NEW SECTION. Sec. 4. This act shall take effect July 1, 1988.