Many California employers may be facing another minimum wage increase on July 1st. Earlier this year, California’s minimum wage was increased to $15.50 for all employers. However, local entities (like cities and counties) are allowed to establish a higher minimum wage rate for employees working within their jurisdiction. Starting on July 1, 2023, a number of localities will raise their minimum wage.
The following chart summarizes these changes:
Impact on Remote Workers
Employers should take this as an opportunity to confirm where any of their remote employees (who are earning minimum wage) are working, as they may be subject to a higher local minimum wage rate than if they were working on-site.
Notice Requirements
Additionally, many of the local ordinances contain specific notice requirements. The required posters typically must be posted in a conspicuous place on the work-site, and often require the notice be provided in multiple languages. Note that, for employers with remote workers, Senate Bill No. 657 allows employers to fulfill the notice requirements by emailing notices to their remote workers. Employers with remote workers should be sure to email their remote employees the required notice to confirm that all employees, including those who work from home, will have access to required information related to the increase in minimum wage.
Impact on Minimum Salary Requirements for Exempt Employees
Notably, these local minimum wage increases do not impact the minimum salary requirements for California employees exempt under the executive, administrative, or professional exemptions. Those requirements are based on the state-wide minimum wage (not a specific localities’ minimum wage), and require an employee to earn at least twice the state minimum wage, or $64,480.00 annually.
Takeaways
If California employers have employees working in any of the above localities, they should assess their employees’ hourly wage rates and make any required changes by July 1st to be in compliance.
