On June 29, 2022, the Los Angeles City Council voted unanimously to adopt a Healthcare Workers Minimum Wage Ordinance (the “Ordinance”). This comes after a 10-2 vote on June 21 required a second reading and vote. The Ordinance was initially submitted as an initiative petition to the City Clerk with voter signatures in May 2022. Under the Ordinance, covered healthcare workers must be paid a minimum wage of $25/hour beginning on the effective date of the Ordinance. On January 1, 2024, the minimum wage will be further increased based on the Consumer Price Index for the Los Angeles metropolitan area.
“Healthcare worker” is defined under the ordinance to mean an employee who is employed to work at a covered healthcare facility to provide patient care, healthcare services, or services supporting the provision of healthcare. This includes clinicians, professionals, non-professionals, nurses, nursing assistants, aides, technicians, maintenance workers, janitorial or housekeeping staff, guards, food service workers, pharmacists, laundry workers, and clerical and administrative workers.
Covered healthcare facilities include acute care hospitals, psychiatric hospitals, licensed skilled nursing facilities that are part of a general acute care hospital or psychiatric hospital, and licensed dialysis clinics. Most broadly, the Ordinance covers all facilities that are part of an Integrated Healthcare Delivery System, which is defined as any system that includes both one or more hospitals and covered physician groups (a medical group practice with 10 or more physicians), healthcare service plans, medical foundation clinics, or other facilities where the hospital and other entities are related to each other through parent/subsidiary relationships, contractual relationships under a common trade name, or contractual relationships through an affiliated hospital system. Public hospitals, nursing homes that are unaffiliated with hospitals, and community clinics are not covered facilities under the Ordinance.
Employers may not fund the minimum wage increases by reducing healthcare workers’ hours of work, premium pay rates or shift differentials, or non-wage benefits such as vacation, healthcare, or subsidizing parking expenses. Employers may also not layoff healthcare workers in order to fund the minimum wage increases required by the Ordinance.
Employers are entitled to seek a one-year waiver from the minimum wage requirements in the Ordinance if they can demonstrate that compliance would raise substantial doubt about the employers’ ability to function as a going concern.
The Ordinance will go into effect after receiving Mayor Garcetti’s signature, which is expected soon.