California Minimum Wage Increases; Businesses to Reconsider Staffing Levels

Employers in the state of California will be subject to new state and local minimum wage standards beginning on Jan. 1, 2023. These requirements will apply to both the state and local levels.

Not only does the increase in the minimum wage effect non-exempt workers, but it also affects the minimum annual salary requirement for employees who are exempt from overtime pay.

California Businesses Brace for Minimum Wage Increase

Previously, the state of California utilized a two-tiered minimum wage system, which mandated that businesses with 25 or more employees were required to pay a higher minimum wage for businesses with less than 25 workers.

However, this policy has since been eliminated. A minimum wage of not less than $15.50 per hour must be provided to all employees by their employers beginning on Jan. 1, 2023, regardless of the size of the employer’s business, according to JD Supra.

Overtime exempt workers in California are required by law to be paid at least twice the state minimum wage. In accordance with the new rise in the state minimum wage, the minimum annual income for overtime-exempt employees will increase to $64,480 as of Jan. 1, 2023.

The report also stated that employees who are not excluded from federal minimum wage laws will see an increase in their base pay in a few communities in California. ‘

If the city’s minimum pay is higher than the state minimum wage in California, then the city’s minimum wage must be paid to non-exempt employees.

Employees who are exempt from overtime yet who work in one of these cities are not required to be paid more than the $64,480 yearly minimum wage in California.

Pushing Healthcare Minimum Wage

More than 100,000 healthcare employees are represented by a union that plans to use the parliamentary session to advocate for a state-level healthcare minimum wage, believing that higher salaries are necessary to enhance retention rates.

The Center Square reported that the Service Employees International Union-United Healthcare Workers West is advocating for a minimum wage law to be passed before the end of next year in the state of California for the healthcare industry.

This comes after the union backed initiatives in two Southern California communities that would have established a $25 minimum wage for select workers in the healthcare sector.

It appears that Measure HC, which would increase the minimum wage for select workers at private hospitals and dialysis clinics in Inglewood to $25 per hour, has been approved by the city’s voters.

The most recent total, which included all votes cast, revealed that 54% of voters supported the proposition, while 46% opposed it. Public hospital staff who perform the same duties are exempt from the regulation.

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