We all know that California’s minimum wage increased to $10.00 per hour effective January 1, 2016. Unfortunately, this latest increase is not the only one California employers will be facing. More than a dozen cities across the state have already enacted their own minimum wage, some as high as $15.37 per hour – and several other cities are looking to follow suit.
The City of Berkeley increased the minimum wage to $11.00 per hour effective 1/1/16 and will increase to $12.53 10/1/16. Emeryville’s current minimum wage is $12.25 per hour with businesses with fewer than 55 employees and $13.00 per hour for employers with more than 55 employees. These will increase to $14.44 and $14.82 respectively 7/1/16.
The city of Los Angeles will increase the minimum wage to $10.50 per hour for employers with 26 or more employers 7/1/16 and for all employers 7/1/17. Mountain View’s current minimum wage is $11.00 per hour, Oakland’s is $12.55, Palo Alto has a minimum wage of $11.00, and Richmond is $11.52 per hour.
San Francisco has a current minimum wage of $12.25 which increases to $13.00 per hour 7/1/16. San Jose has a current minimum of $10.30, Santa Clara’s is $11.00, and Sunnyvale’s minimum hourly wage is $10.30. Other cities have recently approved similar increases.
Sacramento passed an in increase which will progressively raise the minimum wage to $12.50 by 2020, with the first increase to $10.50 going into effect 1/1/17. Employers in Sacramento with fewer than 100 employees will be required to comply with the yearly increases one year after larger employers starting in 2018.
The San Diego City Council adopted an ordinance that would incrementally raise the minimum wage to $11.50 by 2017. This referendum will go before voters in June of this year. Long Beach employers with more than 25 employees will see an increase to $10.50 in 2017, $12 by 2018, and $13 by 2019. Like Sacramento, employers with 25 or fewer employees will get a one-year delay to comply with the raised rates.
In the City of Los Angeles, employers with 26 or more employees shall pay a wage of no less than the hourly rates set forth:
- On July 1, 2016, the hourly wage shall be $10.50.
- On July 1, 2017, the hourly wage shall be $12.00.
- On July 1, 2018, the hourly wage shall be $13.25.
- On July 1, 2019, the hourly wage shall be $14.25.
- On July 1, 2020, the hourly wage shall be $15.00.
Employers with 25 or fewer employees shall pay a wage of no less than the hourly rates set forth:
- On July 1, 2017, the hourly wage shall be $10.50.
- On July 1, 2018, the hourly wage shall be $12.00.
- On July 1, 2019, the hourly wage shall be $13.25.
- On July 1, 2020, the hourly wage shall be $14.25.
- On July 1, 2021, the hourly wage shall be $15.00.
Lastly, Pasadena’s City Council approved an increase to $13.25 by July 2018. The City Council has also approved increasing the minimum wage further to $15 per hour by 2020.
For many employers, there are few options when dealing with an increase to the minimum wage. There are, however, actions for employers who offer incentive pay in the form of commissions and bonuses that take into account these increases in the minimum wage by redesigning their plans to minimize fiscal impact.
Lastly, please remember that there is a salary basis requirement for exempt or salaried personnel. That amount is two times the minimum wage. Each time there is an increase in the hourly minimum wage it does have an effect on the minimum wage for salaried employees as well.
Please do not hesitate to call the professionals at Precision Manufacturing Insurance Services at 855.910.5788 to discuss any questions you may have. Thank you.