On May 12, 2022, Governor Gavin Newsom announced that California’s minimum wage is projected to increase to $15.50 per hour for all workers beginning on January 1, 2023. The accelerated increase is required by Section 246 of the California Labor Code, which was enacted in April 2016 through Senate Bill 3. That law provides that the minimum wage will increase according to a specified schedule when inflation exceeds 7 percent. Newsom’s press release states that “[t]he COVID-19 pandemic has resulted in persistent supply chain disruptions and labor market frictions have driven inflation to its highest rate in 40 years. These conditions have further been exacerbated by Russia’s war in Ukraine.”
Newsom also announced an $18.1 billion inflation relief package including direct payments to help address costs of rising inflation and past-due water and utility bills, free public transit, money for health care workers, middle-class health care subsidies, and waiving child care fees for families.
California currently has the highest statewide minimum wage in the country at $15 an hour. The minimum wage in Los Angeles County is set to increase to $15.96 per hour beginning July 1, 2022. Local counties and cities have the ability to set their own minimum wage increases at a higher rate than the state. For example, the City of West Hollywood is scheduled to increase its minimum wage to $16 an hour on July 1, 2022 and $17 an hour on January 1, 2023, the highest in the nation. Given the dynamic and evolving landscape of California employment law and minimum wage standards, employers are advised to consult with employment law counsel.