As the new year gets off to a start, employers in the retail industry will be making wage adjustments to meet current and future minimum wage increases. Employees in 21 states around the country will see their state’s minimum wage increase.
Effective January 1, 2019, California’s minimum wage increased from $11.00 to $12.00 per hour. This increase applies to all employers who employ 26 or more employees (“large employers”). For employers with 25 or fewer employees (“small employers”), the minimum wage increased from $10.50 to $11.00 per hour. (In fact, all employers ultimately will pay a statewide minimum wage of $15.00 per hour, although the timing of the increase depends on the employer’s size: for large employers, California’s minimum wage will increase by $1.00 on a yearly basis through January 1, 2022, and for small employers, California’s minimum wage will increase by $1.00 on a yearly basis through January 1, 2023. Cal. Lab. Code § 1182.12).
The new year brings new laws for California employers to grapple with. Below we highlight the most significant new employment laws affecting California employers as of January 1, 2018. Companies based in California or with operations in California are encouraged to review their policies and procedures in light of these developments.
Beginning next week, on March 13, 2017, San Jose employers must offer existing part-time employees additional work hours before hiring any temporary, part-time, or new worker. This is a result of a vote last fall by voters in San Jose, California who approved “The Opportunity to Work Ordinance” (Ordinance No. 2016.1, codified at Chapter 4.101 of the San Jose Municipal Code) – a local measure that directs employee hours and hiring practices.
San Jose’s Office of Equality Assurance, the local agency tasked with monitoring, investigating, and enforcing the Ordinance, recently issued its Opportunity to Work FAQs, which provides additional guidance on how employers can comply with the new ordinance. Following more comprehensive scheduling ordinances passed in San Francisco and Emeryville last year, San Jose is the third northern California city to enact a scheduling ordinance.
Recently, Washington DC council members unanimously voted to increase the city’s minimum wage to $15.00 an hour by the year 2020 for non-tipped hourly workers, many of whom work in the retail industry. The news comes just before Washington DC is scheduled to increase its minimum wage rate from $10.50 an hour to $11.50 an hour on July 1, 2016. The move makes DC the third jurisdiction behind California and New York to increase minimum wages to $15.00 an hour.
On December 22, 2014, the U.S. District Court for the District of Columbia vacated a new U.S. Department of Labor (DOL) regulation, scheduled to take effect on January 1, 2015, which eliminated an exemption from the Fair Labor Standards Act (FLSA) for employees who provide home companionship and live-in domestic services. Home Care Ass’n of Am. v. Weil, No. 14-cv-967 (D.D.C. Dec. 22, 2014). The DOL’s new regulation was controversial not only because it reversed years of precedent under the FLSA, but because many questioned whether the DOL had exceeded its authority in promulgating this regulation.
The Florida Department of Economic Opportunity (“DEO”) announced that the state’s minimum wage of $7.93/hour will be increased to $8.05/hour beginning January 1, 2015. The minimum wage for tipped employees will correspondingly increase from $4.91/hour to $5.03/hour, with the employer’s maximum tip credit remaining at $3.02/hour. The DEO has also issued an updated “Notice to Employees” poster which Florida employers are required to post in addition to the federal minimum wage poster as of January 1, 2015.
Minimum wage increases have experienced much activity in 2014. In addition to our previous posts covering wage hike proposals on the city and federal levels, more than 20 states have either increased or proposed to increase their respective minimum wage.
On October 1, 2014 the Los Angeles City Council voted again to require large hotels to pay workers a minimum wage of $15.37, exclusive of gratuities, bonuses, or service charge distributions after first passing the bill 12-3 on September 24, 2014. (A second vote was required under Los Angeles City Council rules because the first vote was not unanimous.) Assuming Mayor Garcetti signs the bill, which he has reportedly already promised to do, the bill will go into effect on July 1, 2015, applying first to hotel employees at hotels with 300 or more guest rooms and then, on July 1, 2016, expanding its reach to hotel employees employed by hotels with 150 or more guest rooms.
On February 12, 2014, President Obama announced Executive Order 13658, “Establishing a Minimum Wage for Contractors.” The order seeks to raise the hourly minimum wage paid to workers performing services on covered Federal contracts to: (i) $10.10 per hour, beginning January 1, 2015; and (ii) beginning January 1, 2016, and annually thereafter, an amount determined by the Secretary of Labor in accordance with the Order.