On May 19, 2015, the Los Angeles City Council approved a proposal for a gradual establishment of a citywide minimum wage of $15.00 per hour by July 1, 2020.  Once adopted, Los Angeles will join other large U.S. cities, including Chicago, Seattle and San Francisco, to establish local minimum wage ordinances that far exceed the federal minimum wage of $7.25. The State of California has already raised the statewide minimum wage to $9.00 per hour effective July 1, 2014, with an increase to $10.00 per hour set to go into effect on January 1, 2016.

Under the City Council’s approved proposal, beginning on July 1, 2016, the minimum wage in Los Angeles will be $10.50 per hour and will increase annually to $12.00, $13.25, $14.25 and $15.00 by July 1, 2020.  Small businesses and non-profit entities with 25 or fewer employees will be subject to the same minimum wage requirements but the increases will start one year later, with $10.50 on July 1, 2017, followed by annual increases to $12.00, $13.25, $14.25 and $15.00 per hour by July 1, 2021.  Additionally, beginning on July 1, 2022, the minimum wage in Los Angeles will increase annually in lock step with the Consumer Price Index for Urban Wage Earners and Clerical Workers, ensuring further increases to the local minimum wage.

The proposal approved by the Los Angeles City Council also requires Los Angeles’ Chief Legislative Analyst (“CLA”) to analyze California’s sick leave law and similar local ordinances, including the sick leave ordinances of San Francisco and Oakland, and to make recommendations for a Los Angeles sick leave ordinance for the council’s consideration. 

In order for the above minimum wage schedule to become effective, the Los Angeles City Attorney will draft an ordinance for the council’s approval, which will then go to Mayor Eric Garcetti, a strong proponent of a $15 minimum wage, for signature.  While the council’s 14-1 vote on the local minimum wage proposal did not, in and of itself, establish the above minimum wage schedule, the establishment of a final local minimum wage ordinance is virtually certain.