CALIFORNIA VOTES TO HIKE MINIMUM WAGE
Despite opposition, lawmakers and labor unions were able to come up with a deal between them on Monday, March 28, 2016. With pressure from all sides, they agreed to a plan that would raise California’s current minimum wage rate from $10.00 per hour to $15.00 per hour, affecting approximately 5.6 million Californians, which is 32 percent of the state’s workforce that live off of minimum wage pay rate. On Thursday, March 31st, the full Assembly voted to enact the wage increase, sending the bill to Governor Brown to sign into law.
THE RATE OF INCREASE
Currently, the California minimum wage is second only to Washington D.C. which is set at $10.50 per hour. However, this will not be true for very long. The draft bill requires the following increase increments as of January 1st each year:
2017: $10.50/hour, a 0.50 cent increase;
2018: $11.00/hour, a 0.50 cent increase;
2019: $12.00/hour, a $1.00 increase;
2020: $13.00/hour, a $1.00 increase;
2021: $14.00/hour a $1.00 increase; and
2022: $15.00/hour a $1.00 increase.
Two other proposals have already qualified for the ballot. Both would like the minimum wage to be $15.00 per hour, however one would see it completed by 2020, the other by 2021. The opposition to these bills are that such a steep increase would likely strain the economy.
The plan does allow for various exemptions as it stands now. The first is related to unforeseeable events that still must be taken into consideration, such as a recession. In a recent press conference, Governor Brown stated that the bill does include “flexibility in the event that there’s a recession or a budgetary downfall.”
Another exception would be for small business. If a business has under 25 paid employees, they would have an additional year to comply with each hike. This means that for the small businesses, it would potentially take up to twice the amount of time to reach the $15.00 goal.
If you are a business owner and are concerned with how this will affect your small business and wage policies, you may be interested in speaking with a skilled and reliable attorney to help you make the best decisions for your business and employees. If you are in need of assistance from a skilled San Jose business attorney, The Law Offices of Steven E. Springer are able to answer any questions you may have. With more than 30 years of combined experience, let us put our knowledge to work for you. Call us today at 408-779-4700 for your free initial 20 minute consultation.