5 New Laws Hitting the City of Seattle on January 1st

Here are five of the most significant laws taking effect in the Emerald City on January 1, 2026.

1. January 1 Minimum Wage Milestone

Seattle officially maintains its position as a national leader in wages. On January 1st, the city'January 1age will undergo its latest inflation-adjustment.

• The New Rate: All businesses with employees working within Seattle city limits must pay at least $21.30 per hour.
• One Standard: This increase marks the continued convergence of the wage floor for small and large employers, ensuring that workers across the city receive the same base pay regardless of the company's size.
• Inflation Indexing: This 2026 rate is based on the Consumer Price Index (CPI) for the Seattle-Tacoma-Bellevue area, designed to help local workers keep pace with one of the highest costs of living in the U.S.

2. The 9.683% Rent Increase Cap

In a move to combat the housing crisis, a new statewide limit on rent hikes officially takes effect this January, with a specific rate tailored to the Seattle market.

• The Limit: Under House Bill 1217, the maximum allowable rent increase for 2026 is capped at 9.683%.
• The Mechanism: This percentage is calculated by the Washington Department of Commerce based on the regional Consumer Price Index.
• Tenant Protections: Landlords must abide by this cap for all rental units subject to the Residential Landlord-Tenant Act. This provides much-needed predictability for Seattle renters who have faced double-digit increases in previous years.

3. B&O Tax Relief for Small Businesses

A key highlight of the 2026 Seattle City Budget is a significant restructuring of the Business and Occupation (B&O) tax to protect local "mom and pop" shops.

• The Relief: The new tax code provides direct relief for approximately 90% of SSeattle'ssmall and medium-sized businesses.
• The Progressive Shift: While small businesses see a reduction, the budget raises approximately $81 million in new revenue by increasing rates for the city's largest corporations.
• Community Investment: The revenue generated is earmarked for essential city services, including the "Seattle Restored" program, which helps fill vacant storefronts with new local startups.

4. "Panic Buttons" for Isolated Workers (HB 1524)

New safety mandates are hitting the hospitality and service sectors to protect employees who often work alone and are vulnerable to harassment or assault.

• The Requirement: Employers must provide a "panic button" or emergency signaling device to any "isolated employee"—defined as those who spend more than 50% of their time working alone. This includes janitors, hotel housekeepers, security guards, and room-service staff.
• Training & Enforcement: The law also mandates specific training on preventing workplace violence and harassment. The Department of Labor & Industries (L&I) now has the power to fine or even shut down non-compliant businesses, with penalties starting at $1,000 for the first offense.

5. Expanded Job Protections for Paid Family Leave

Washington State is significantly strengthening its Paid Family and Medical Leave (PFML) program, making it easier for employees at mid-sized companies to take leave without fear of losing their jobs.

• Lowered Threshold: Starting January 1st, the threshold for the mandatory job protection drops from 50 employees to 25 employees.
• Tenure Requirement: Workers are now eligible for job restoration after only 180 days of employment (down from 12 months), and the minimum "hours worked" requirement has been eliminated.
• Minimum Claim Change: To allow more flexibility, the minimum duration for a PFML claim has been reduced from 8 hours to 4 hours, making it easier for parents or caregivers to attend shorter medical appointments.

Honorable Mention: The "Right to Repair"

Starting January 1st, a new law goes into effect in Washington. Original manufacturers of digital electronic products (like smartphones and laptops) must now make parts, tools, and repair documentation available to independent repair shops and owners, a significant win for sustainability and consumer choice.