Washington Restaurant Managers in 2027: When Salary Stops Qualifying for Overtime Exemption

Quick answer: starting January 1, 2027, a salaried restaurant manager in Washington can be exempt from overtime only if you pay at least $1,595.70 a week ($82,976.40 a year) when your business has 50 or fewer Washington-based employees, or $1,773.00 a week ($92,196.00 a year) when it has 51 or more. Through December 31, 2026, the line is $1,541.70 a week for employers of every size. Salary is only one of the tests. The manager also has to be paid a real salary, the same fixed amount every pay period, and has to actually do executive work. That means running the restaurant or a department is their main job, they regularly direct at least two full-time employees or the equivalent, and they can hire and fire or their say on it carries real weight. Time spent on crew work doesn’t settle the main-job question on its own, in either direction. A manager who cooks or serves for much of the week can still have management as their main job if they keep running the restaurant while they do it. Someone whose main job is the crew work, with some supervising on the side, doesn’t qualify at any salary. L&I’s policy judges work done at the same time as managing case by case, on all the facts, and every other test still has to pass. If a role fails a test, pay overtime and track the hours. If you can’t tell whether it passes, ask L&I or an employment lawyer before you treat it as exempt.

Washington’s Department of Labor & Industries (L&I) announced the 2027 numbers on September 30, 2026. Its salary threshold schedule (publication F700-207-000, dated October 2026) shows the same amounts. Every source here was read November 3, 2026. This page covers Washington state rules for an ordinary hired manager. It isn’t legal advice, and the restaurant and numbers in the worked example are made up.

The salary numbers for 2026, 2027 and 2028

The threshold is a multiple of the state minimum wage for a 40-hour week. In 2027 the state minimum is $17.73, so 40 hours is $709.20. Small employers multiply by 2.25 ($1,595.70) and large employers by 2.5 ($1,773.00). The annual figure is the weekly figure times 52. In 2026 both sizes use 2.25 times the $17.13 minimum, which is $1,541.70.

• It’s the state minimum, even in Seattle. The rule ties the threshold to the state minimum wage. Seattle’s 2027 hourly minimum of $22.14 doesn’t change these numbers. Local labor laws are a separate check, and this page doesn’t cover them.
• The weekly number is the rule. Each paycheck has to cover at least the weekly amount for every week it pays. On a biweekly payroll that’s $3,191.40 for a small employer and $3,546.00 for a large one. If you pay semi-monthly or monthly, have payroll confirm the per-check amount. The rule looks at the fixed salary in each pay period, so don’t plan to make up a short salary with a bonus at the end of the year.
• Meals don’t count. The salary has to meet the threshold “exclusive of board, lodging, or other facilities,” so free shift meals don’t count toward it.
• 2028 isn’t set yet. From January 1, 2028, the multiplier is 2.5 for every employer size. The $1,796.00 on L&I’s schedule is a projection based on forecast inflation, and L&I says so. The real number depends on the 2028 state minimum wage, which hasn’t been announced.

Count your employees the way the rule counts them

Which threshold applies depends on how many Washington-based employees your business has. The rule, WAC 296-128-545, is specific about how to count:

• Everyone counts as one. A full-time cook and a server who works two shifts a week each count as one employee. Don’t convert part-timers to full-time equivalents.
• The whole employer, not one location. The count is every Washington-based employee the employer has, not just the staff at the restaurant where the manager works.
• Count as of the effective date. For 2027, that’s the number you employ on January 1, 2027. Seasonal hires still employed that day count.
• 50 is small, 51 is large. 50 or fewer employees means the $1,595.70 threshold. 51 or more means $1,773.00.

The rule also lets an employer that the state’s paid family and medical leave program has classified as having fewer than 50 employees rely on that classification for the following calendar year. The rule cites RCW 50A.10.030(8)(c), but in the current text of that law the employer-size calculation sits in subsection (7)(c). Confirm with L&I before relying on it.

Don’t confuse this count with the duties test below. That one does use full-time equivalents. The employer count doesn’t.

Stop and ask L&I or an employment lawyer first if you run more than one restaurant through separate companies, share staff with another business, use a PEO or staffing agency, or have people who work partly outside Washington. The rule doesn’t say how those situations count, and it doesn’t define “Washington-based.” The same goes for a restaurant that opens after January 1, 2027, since the count is taken on the effective date.

Salary is one test. The job has to pass the others

Washington’s executive exemption, WAC 296-128-510, needs all four of these:

1. The manager’s primary duty is management of the business or of a recognized department or subdivision. When a business has more than one location, the person in charge of each one can count as running a subdivision.
2. They customarily and regularly direct two or more other employees, meaning two full-time employees or the equivalent. One full-time employee plus two half-time employees counts, and so do four half-time employees. Hours can’t be credited to two different managers.
3. They have the authority to hire or fire, or their recommendations on hiring, firing, promotion and other status changes are given particular weight.
4. They’re paid on a salary basis at or above the threshold above.

Salary basis has its own rule, WAC 296-128-532. The manager gets a predetermined amount each pay period of one week to one month, and you can’t cut it because the work varied in quantity or quality. Docking pay for a slow week or a partial day is generally not allowed. The rule lists narrow exceptions, such as a full week with no work, full days off for personal reasons, and the first and last weeks of employment.

L&I’s executive exemption policy (ES.A.9.3) says job titles and job descriptions don’t decide exempt status. The actual duties do, and the employer has to show they meet the test. Here’s what the policy means in a restaurant:

• A manager whose primary duty is running the restaurant can still cook or serve during a rush without losing the exemption. The policy uses that exact example for a food service manager. Generally, an exempt manager decides when to step in and stays responsible for how the operation runs.
• Shift leads and other working supervisors are a different case. If they spend most of the shift doing the same work as the crew, and earn little more than the crew, they generally aren’t exempt, even if they spend some time directing others or setting schedules.
• Someone who supervises only when the general manager is off doesn’t meet the two-employee test. Neither do two managers who share supervision of the same crew when there are fewer than four full-time employees under them, because the same hours can’t be credited twice.
• Trainees learning to be managers aren’t exempt executives.
• L&I calls more than half of working time on management a good rule of thumb for primary duty, but time alone isn’t the test. In its own example, an employee spends more than half their time on production or sales work while also supervising staff, ordering merchandise, handling customer complaints and authorizing bills, and still has management as their primary duty. L&I also weighs how important the management work is, how often the person makes real decisions, how free they are from supervision, and how their pay compares with the crew doing the same work.

What this page doesn’t cover. Someone who owns a bona fide 20% equity stake and is actively engaged in management can be exempt with no salary test at all. That’s a separate exemption, and it isn’t an ordinary hired manager. Administrative, professional and computer professional exemptions, collective bargaining agreements and local ordinances are outside this page too. Federal law has its own exemption rules. L&I’s policy says employers must comply with both state and federal rules and follow whichever is more favorable to the worker. Meeting the Washington number doesn’t by itself settle the federal side, so check it with your payroll provider or counsel.

A worked decision (fictional)

Cedar Row Kitchen is a made-up restaurant with one location in a Washington city that has no local minimum wage above the state’s. Its general manager is on a salary of $82,000 a year in 2026, paid biweekly. That’s $1,576.92 a week, above the 2026 line of $1,541.70. The manager usually works 45 to 50 hours a week. Cedar Row’s workweek runs Monday to Sunday.

Step 1: count

On January 1, 2027, Cedar Row expects to employ 21 full-time and 27 part-time employees in Washington. That’s 48 people, so it’s a small employer and the threshold is $1,595.70 a week. The current salary falls $18.78 a week short ($976.40 a year).

Now say Cedar Row keeps three holiday hires on staff through January 1. That makes 51 employees. The threshold jumps to $1,773.00 a week, and the same salary falls $196.08 a week short ($10,196 a year). If the 30 part-timers average about 17 hours a week, those 51 people add up to only about 34 full-time equivalents. That doesn’t matter. The rule counts heads.

Step 2: duties

In this example, the general manager runs the restaurant. They build the schedule, direct both the kitchen and floor crews (well over two full-time equivalents), interview and hire, discipline and fire, order product and manage the labor budget. On Friday nights they also run the expo line. On these made-up facts, the duties test passes, and the rush shifts don’t change that. A real manager has to be judged on what they actually do.

Cedar Row’s kitchen lead is the counterexample. They’re paid $1,800 a week ($93,600 a year), more than either threshold. They spend most of every shift cooking on the line. They direct one full-time cook and one half-time prep cook, which is 1.5 full-time equivalents. The chef makes hiring and firing decisions without asking them. Those two facts settle it without the cooking time: 1.5 full-time equivalents fails the two-employee test, and having no say in hiring fails the hiring test. Cedar Row doesn’t need to decide whether management is their primary duty, and time on the line alone wouldn’t decide it. The kitchen lead is nonexempt even though the salary clears both thresholds, and they’re owed overtime for hours over 40 in a workweek. Raising their salary further wouldn’t change that.

Step 3: price both routes for the general manager

Route A, keep the role exempt by raising the salary. This is open only because the duties pass. As a small employer, Cedar Row sets the salary at $1,600 a week ($83,200 a year), a little above the $1,595.70 line. That’s $1,200 a year more in wages than today. If it were a 51-employee employer, it would set $1,775 a week ($92,300 a year), which is $10,300 a year more. Either way, the cost doesn’t change with the hours worked.

Route B, treat the role as nonexempt and pay a single hourly rate. Cedar Row prices this at $40 an hour, also made up. It picked $40 because 40 hours at that rate equals the $1,600 salary option. The rate is a budgeting choice, not a formula for converting a salary to an hourly rate. Every hour worked gets recorded and paid, and hours over 40 in a workweek are paid at $60 (1.5 times $40). The legal floor for the rate is the minimum wage that applies where the person works: $17.73 under state law in 2027, or a higher local rate in cities like Seattle ($22.14). $40 is above both.

At 45 hours every week, Route B costs $98,800 a year (52 × $1,900). At 50 hours it’s $114,400. Overtime is figured one workweek at a time, with no averaging. A 35-hour week followed by a 55-hour week costs $1,400 + $2,500 = $3,900. Two 45-hour weeks cost $3,800, even though the total hours are the same.

How Cedar Row reads it. For a manager who genuinely passes the duties test and regularly works 45 hours or more, raising the salary costs less than paying $40 an hour, at either employer size. With 51 or more employees, the $40 rate costs less than the $1,775 salary only in weeks under about 43 hours (40 hours plus $175 ÷ $60 is 42.9). If the duties don’t pass, Route A isn’t available at any price. That’s the kitchen lead’s situation.

What isn’t in these numbers. Employer payroll taxes, workers’ comp, benefits and anything else that scales with pay. Get those from your payroll provider rather than a rule of thumb. A nonexempt manager also earns Washington paid sick leave, which an exempt executive doesn’t under state law, and needs real timekeeping for ordering, prep and closing, not just scheduled shifts. If you keep a nonexempt employee on a salary instead of an hourly rate, overtime is still due. L&I’s method then depends on how many hours the salary is agreed to cover, and it treats the salary as covering 40 hours when there’s no clear agreement. Have payroll or counsel set that up. This page doesn’t calculate it. Changing a manager’s classification or pay changes their job, so run it past your payroll provider and an employment lawyer before January 1. Nothing here suggests cutting anyone’s pay.

Before your first January payroll

1. Count your Washington-based employees as of January 1, 2027. Count heads, include part-timers and include every location. If the count is close to 50 or depends on how your companies are set up, settle it with L&I or counsel now.
2. List every salaried employee you treat as exempt. Write down what each one actually does in a normal week: how much time goes to managing versus line or floor work, who they direct and for how many hours, and who makes hiring and firing decisions.
3. For roles that clearly pass, set the salary at or above the 2027 weekly number. Confirm each paycheck covers it for every week in the pay period. The new threshold takes effect January 1, 2027, a Friday. With a Monday-to-Sunday workweek, the week of December 28 to January 3 spans that date, and so does any biweekly pay period that includes it. The rule and L&I’s announcement give the January 1 date but don’t say how a spanning week or pay period is handled. One conservative option is to pay the new salary for that whole week, starting December 28. That’s a planning choice, not a requirement the rule states. Have payroll, L&I or counsel confirm how your first 2027 week and pay period are handled.
4. For roles that fail, or that you can’t confirm, treat them as nonexempt. Record all hours. Pay at least the minimum wage that applies where the person works, plus 1.5 times the regular rate for hours over 40 in each workweek. Set the pay method up with payroll.
5. Put 2028 on the calendar. Small employers move to 2.5 times the state minimum on January 1, 2028. Check L&I’s 2028 minimum wage announcement before using any 2028 dollar figure.

Copy this decision note

It keeps the dates, the counting rule, the duties gates and the stop points together, so it still makes sense on its own in a manager file or payroll folder.

WA SALARIED MANAGER CHECK, 2027
Washington state rules only.
Not legal advice.

SCOPE
Hired managers paid a salary
and treated as overtime-exempt.
NOT covered here: owners with a
bona fide 20% stake, other
exemptions, federal rules,
local laws. Check separately.

THRESHOLD (state min wage
$17.73 x 40 hrs x multiplier,
not Seattle's $22.14)
Through Dec 31, 2026:
  any size $1,541.70/week
From Fri Jan 1, 2027:
  1-50 employees:
    $1,595.70/week (2.25x)
    = $82,976.40/year
  51+ employees:
    $1,773.00/week (2.5x)
    = $92,196.00/year
2028: 2.5x for every size.
  $1,796/week is L&I's
  projection, not law yet.

1. COUNT, AS OF JAN 1, 2027
[ ] Every Washington-based
    employee = 1, full-time
    or part-time
[ ] Every WA location, not
    just this restaurant
[ ] Heads, not FTEs
    50 or fewer: $1,595.70
    51 or more:  $1,773.00
STOP, ask L&I or counsel, if:
separate companies, shared
staff, PEO/agency, work partly
outside WA, or opening after
Jan 1 make the count unclear.

2. DUTIES (actual work, not
   title or job description)
[ ] Main job is managing the
    restaurant or a department
    (time on crew work alone
    doesn't decide it either
    way; weigh all the facts)
[ ] Regularly directs 2+ full-
    time employees or the
    equivalent; same hours
    not credited to 2 managers
[ ] Hires/fires, or hiring and
    firing input gets
    particular weight
[ ] Not a trainee
Any NO: nonexempt at ANY
salary. Go to 4.
Unsure: STOP. Ask L&I or
counsel before calling it
exempt.

3. SALARY (only if 1 and 2
   pass)
[ ] Same fixed salary every
    pay period; not docked
    for slow or partial days
[ ] Covers the weekly number
    for EVERY week paid
    (biweekly: 2x weekly)
[ ] Meals/lodging don't count
[ ] No later bonus to make up
    a short paycheck
Short: raise it, or go to 4.
Effective date: Jan 1, 2027.
Week or pay period spanning
Dec 31-Jan 1: ask payroll,
L&I or counsel how it's paid.
Optional, cautious: start the
new salary for that whole week
(Mon-Sun week: Mon Dec 28).
Not a rule the WAC states.

4. NONEXEMPT
[ ] Record every hour worked
[ ] Rate at least the minimum
    wage that applies there
    (state $17.73 or higher
    local rate)
[ ] 1.5x regular rate for
    hours over 40 in each
    workweek; no averaging
[ ] Kept on salary? Payroll
    or counsel sets the
    regular-rate method.
    Don't guess.
[ ] WA paid sick leave applies

NOT DECIDED BY THIS NOTE
Payroll taxes, benefits,
workers' comp, federal and
local rules, 2028 dollars.

STOP if anyone suggests unpaid
overtime or asking a manager
to waive it. It can't be
waived.

When to stop and get an answer first

• You can’t say for sure whether you have 50 or fewer, or 51 or more, Washington-based employees on January 1, 2027, because of separate companies, shared staff, a PEO or staffing agency, people working partly outside Washington, or an opening date after January 1.
• A manager’s real week is split between managing and doing crew work, or they share the same small crew with another manager, and you can’t tell whether the duties test passes.
• Someone wants to rely on the owner exemption, a different exemption or a paid family and medical leave size classification. Those have their own rules.
• Anyone suggests not paying for hours worked, having a manager agree to give up overtime, or meeting the threshold with a year-end bonus instead of the salary itself. L&I’s overtime policy (ES.A.8.1) says overtime can’t be waived by agreement.

Related reading

If you have hourly staff in Seattle, Seattle’s 2027 minimum wage for restaurants covers the city’s $22.14 hourly rate. It’s a separate rule that doesn’t cover salaried managers. To fold overtime and employer costs into a labor budget, see labor cost math: start with dollars, then percentages. More short operator questions are in Answers.

Sources, all read November 3, 2026: L&I’s September 30, 2026 minimum wage announcement and its salary threshold implementation schedule (October 2026), WAC 296-128-545, WAC 296-128-510 and WAC 296-128-532, L&I’s overtime and exemptions page, its policies ES.A.9.3 (revised June 26, 2020) and ES.A.8.1 (revised April 6, 2023), and RCW 50A.10.030. Nothing here was tested in a payroll system, and nothing here is legal, tax or payroll advice for your business.