On October 13, 2023, California Governor Gavin Newsom signed California Senate Bill No. 525 (SB 525) into law, which gradually raises the minimum wage to $25 for California health care workers.

Covered Health Care Facility Employers and Health Care Services

Beginning June 1, 2024, SB 525 requires most health care facilities to raise minimum wages for their employees, with the rate of the wage increases depending on the type of facility. Unless expressly exempted, facilities providing health care services must comply with the minimum wage increases under SB 525. The term “health care services” is defined broadly to mean “patient care-related services including nursing; caregiving; services provided by medical residents, interns, or fellows; technical and ancillary services; janitorial work; housekeeping; groundskeeping; guard duties; business office clerical work; food services; laundry; medical coding and billing; call center and warehouse work; scheduling; and gift shop work; but only where such services support patient care.”

SB 525 covers a broad range of health care facilities, including but not limited to (i) hospitals, (ii) clinics, (iii) home health agencies, (iv), psychiatric health facilities, (v) skilled nursing facilities if owned, operated, or controlled by a hospital or integrated health care delivery system or health care system and (vi) residential care facilities if affiliated with an acute care provider or owned, operated, or controlled by a general acute care hospital (or parent entity), acute psychiatric hospital (or parent entity). Exempt facilities include (i) hospitals owned, controlled, or operated by the Department of State Hospitals, (ii) tribal clinics exempt from licensure under Section 1206(c) of the Health and Safety Code (Code), and (iii) outpatient settings conducted maintained, or operated by a federally recognized Indian tribe, tribal organization or urban Indian organization, as defined in 25 U.S.C. 1603.

Covered Employees

SB 525 applies to the following types of workers:

• an employee of a health care facility employer who provides patient care, health care services, or services supporting the provision of health care (e.g., nurse, physician, caregiver, medical resident, intern or fellow, patient care technician, janitor, housekeeping staff person, groundskeeper, guard, etc.);
• a contracted or subcontracted employee if (i) the employee, contractor or subcontractor’s contracts with the health care facility employer to provide health care services, or services supporting the provision of health care and (ii) the healthcare facility employer directly or indirectly, or through an agent or any other person, exercises control over the employee’s wages, hours or working conditions; and
• all employees performing contracted or subcontracted work primarily on the premises of a health care facility to provide health care services or services supporting the provision of health care.

Mandated Increases to Minimum Wages

Depending on the type of health care facility, SB 525 provides for the following minimum wage increases:

SB 525’s full text is available here.