California employers must be aware that the state’s minimum wage increases to $9 per hour on Tuesday, July 1st. This is the first increase in the state minimum wage in six years, and represents a $1 per hour increase from the previous minimum wage of $8 per hour. This new minimum wage is only temporary, and will increase to $10 per hour on January 1, 2016.
Low-end, hourly employees are not the only employees who are affected by this increase, however. It is also important to remember that California law also requires salaried, exempt employees to earn a monthly salary equivalent of no less than two times the new state minimum wage for full-time employment. Consequently, even some exempt employees will see an increase in their salary as a result of the minimum wage increase. Effective July 1st, the new minimum monthly salary for exempt employees will be $3,120, or $37,440 per year.
It is also important to remember that effective January 1, 2014, the City and County of San Francisco increased its minimum wage for all employees working in San Francisco to $10.74 per hour. The notice that San Francisco requires its employers to post can be found and printed here.
Not to be outdone by the City of Seattle, San Francisco Mayor Ed Lee recently proposed a measure to increase San Francisco’s minimum wage to $15 per hour by July 2018. Voters will have the opportunity to weigh in on Mayor Lee’s proposal in the upcoming November ballot. Even if Mayor Lee’s proposal is voted down (which seems unlikely given the proposal’s support), San Francisco’s minimum wage is already set to increase to $11.03 on January 1, 2015.
The San Francisco Board of Supervisors also recently voted to increase employers’ expenditures under the Health Care Security Ordinance (“HCSO”). Under the HCSO, employers must satisfy the Employer Spending Requirement by calculating and making required health care expenditures on behalf of all covered employees. Effective January 1, 2015, these expenditures are set to increase, depending on the number of employees. The notice that San Francisco requires its employers to post regarding the HCSO can be found and printed here. For more information on the HSCO in general, please click here.
The HSCO and the proposed increase to its minimum wage rate are additional examples of employment-related ordinances unique to the City and County of San Francisco. Employers should recall San Francisco’s Commuter Benefits, Family Friendly Workplace, and Paid Sick Leave.
Any employers interested in discussing or implementing any of the above changes to California and San Francisco law or any other employment-related policy or practice (or even the recent woes of the San Francisco Giants) are encouraged to contact Ryan McCoy in CDF’s San Francisco office.