What goes up continues to go up! As we pointed out here last year, the trend of increasing the minimum wage continues, as follows:
State:
On January 1, 2024, the California state minimum wage will increase from $15.50 per hour to $16.00 for employers of all sizes, reflecting a 3.5% increase, which is based on the expected rate of inflation. The state minimum wage also governs the exempt employee threshold salary, which will increase accordingly. The new minimum salary for employees who otherwise qualify to be exempt from overtime will be $66,560 annually for employers of all sizes.
Local:
Several California municipalities raised their minimum wage rates on July 1, 2023. Employers should take care to note these changes because the pace of minimum wage increases in these locations surpass the rate required by the state of California.
Several cities increased their minimum wage rates based on the Consumer Price Index (CPI). Among these are the City of Los Angeles, where the current minimum wage increased from $16.04 to $16.78 per hour for all employers. In Malibu, Santa Monica and unincorporated Los Angeles County, the minimum wage increased from $15.96 to $16.90 per hour for all employers. In Pasadena, the current minimum wage increased from $16.11 to $16.93 per hour for all employers.
After a number of past phased-in increases, which differed based on employer size and type, on July 1, 2023, the City of West Hollywood increased the minimum wage for employers of all sizes and types (including hotel employers) to $19.08 per hour. In future years, the City of West Hollywood will announce increases for all employers based on the CPI by each April 1st, with increases to become effective each July 1st.
In determining whether a given increase applies, employers should know that it is not where an employee lives, or where an employer is based, that determines the minimum wage that must be paid. Rather, it is where the employee works that determines the applicable minimum wage rate. In many municipalities, if an employee works as few as two hours in the city in a week, that municipality’s minimum wage will apply to the time worked there for that week.
The author would like to gratefully acknowledge the assistance of Joanne Warriner.
