California Governor Edmund Brown recently signed Assembly Bill 10, which raises California’s minimum wage requirement by two dollars over the next two years. Governor Brown had publicly announced he would sign the bill in order to help working families adjust to the rising costs of living in California.
The current state minimum wage for all industries is $8.00 an hour but by 2016 it will reach $10.00. The increase will occur in two increments. Effective July 1, 2014, the minimum wage will increase to $9.00 an hour. The second increment will go into effect January 1, 2016 and it will increase minimum wage from $9.00 an hour to $10.00 an hour.
Some Bay Area employers will not feel the impact of this bill considering that in San Francisco, the minimum wage is $10.55 an hour and in San Jose it is $10.00 an hour.
How Does This Affect Your Business?
California employers must understand the new wage requirements so that they can:
• Pay employees the correct minimum wage and overtime rates
• Ensure that exempt employees are paid a salary in line with the new minimum wage, which may mean increasing employee salaries
• Adjust payroll systems to reflect the increased minimum wage
• Post accurate wage notices in the work place
• Answer employee’s questions about the new minimum wage
In taking each of these steps, employers can limit the risk of a wage or hour claim being brought against them by an employee. If you have any questions about your obligations under the new minimum wage law, please contact us at firstname.lastname@example.org or reach out to your Mitzel Group, LLP attorney directly.