California Wage and Hour Laws
The California legislature enacted a number of employment related laws in 2016. Employers with operations in California should be aware of the new wage and hour laws summarized below and consult an experienced employment lawyer should questions arise.
Minimum Wage Increase
The most notable and headline-grabbing employment law adopted by the state legislature was SB 3, which impacts the state minimum wage in 2017 and future years. SB 3 amends Section 1182.12 of the Labor Code and provides for a six-step annual statewide increase of the current minimum wage of $10 per hour to $15 per hour for all employees working for an employer of 26 or more employees. Within the annual increases in the minimum wage, is the creation of a two-tier system in which a $10.50 minimum wage rate applies to employers with 26 or more employees and a $10.00 minimum wage rate applies to employers with 25 or fewer employees. The new minimum wage as of January 1, 2017 is $10.50 per hour. The six-step increase is planned as follows:
For any employer with 26 or more employees, the minimum wage shall be as follows:
- January 1, 2017, to December 31, 2017, inclusive,—$10.50 per hour
- January 1, 2018, to December 31, 2018, inclusive,—$11 per hour
- January 1, 2019, to December 31, 2019, inclusive,—$12 per hour
- January 1, 2020, to December 31, 2020, inclusive,—$13 per hour
- January 1, 2021, to December 31, 2021, inclusive,—$14 per hour
- January 1, 2022, and until adjusted by subdivision (c)—$15 per hour
For any employer with 25 or fewer employees, the minimum wage shall be as follows:
- January 1, 2018, to December 31, 2018, inclusive,—$10.50 per hour
- January 1, 2019, to December 31, 2019, inclusive,—$11 per hour
- January 1, 2020, to December 31, 2020, inclusive,—$12 per hour
- January 1, 2021, to December 31, 2021, inclusive,—$13 per hour
- January 1, 2022, to December 31, 2022, inclusive,—$14 per hour
- January 1, 2023, and until adjusted by subdivision (c)—$15 per hour
Challenges to Minimum Wage Violations
Under current law, an employee may file a wage claim with the Labor Commissioner for unpaid wages. If the Labor Commissioner rules in favor of the employee, the employer may appeal to the Superior Court, but must first file a wage bond for the amount of unpaid wages owed. AB 2899amends Labor Code Section 1197.1 (the minimum wage violations law) and requires an employer seeking a writ of mandate contesting a citation by the Labor Commissioner regarding failure to pay minimum wages to post a bond with the Labor Commissioner in an amount equal to the unpaid wages assessed under the citation, excluding penalties. The law requires that the bond be issued in favor of the unpaid employee such that, if the employer fails to pay the amounts owed within 10 days from the conclusion of the proceedings, the proceeds of the bond will be forfeited to the employee.
Itemized Wage Statement Exception to Total Hours Requirement
AB 2535 amends Labor Code Section 226, clarifying that employers are not required to include in itemized wage statements the total number of work hours by employees exempt from the payment of minimum wage and overtime. Employers must continue to include the total hours worked by non-exempt employees in the itemized wage statements for each pay period.
Local Wage Enforcement
Minimum wage laws have been passed throughout California, many at the local level. However, cities and counties may not have the resources to fight wage theft – instances when workers are not paid the wages to which they are legally entitled. Wage theft occurs when workers 1) receive payment at a rate below the legal hourly minimum, 2) are not paid for off-the-clock work, 3) are not properly paid overtime, or 4) fail to get required rest and meal breaks. SB 1342 adds Section 53060.4 to the Government Code, granting local officials or department heads the power to issue subpoenas and to report noncompliance with employment-related ordinances, such as local minimum wage ordinances, to superior court judges. According the legislative analysis, SB 1342 may pave the way for a statewide mechanism to combat wage theft that occurs at the local level.
If you employee workers in California and have questions about new or existing wage and hour laws, feel free to contact leading California employment lawyers at Kingsley & Kingsley. Call toll-free at (888) 500-8469 or contact us via email.