June 1, 2017
Compliance Matters
                                                                                                        Newsletter
 
ARE YOUR MINIMUM WAGE EMPLOYEES DUE FOR AN INCREASE THIS JULY 1? 
 
      
Are your employees due for a minimum wage increase this July 1? Thanks to what's now become a confusing patchwork of federal, state and local minimum wage requirements, that's not an easy question to answer. It depends upon the following factors:
  • where your business is located;
  • how many employees you employ;
  • where your employees actually do their work;
  • whether the employees are covered by a union contract;
  • whether the employees in question are working on a government contract with specified minimum wage rates; and
  • the industry in which the employees work.
In California alone there are a total of 37 different wage ordinances. Some provide for a complete exemption if employees are covered under a union contract with a specified wage rate. Since increases in the company's bottom wage rates often have a ripple effect on the wages of those above them, it's important for businesses to analyze these requirements when establishing a company's overall pay scheme.

Besides the federal and CA state minimum wage laws, a number of cities and counties throughout CA have promulgated their own special minimum wage requirements which must be followed. For example, in the Southland, the cities of Los Angeles, Pasadena and Santa Monica have their own minimum wage rules. Los Angeles and Santa Monica each have their own special (higher) minimum wage requirements for hotels and related businesses operating within their geographic boundaries.

These rules can also apply beyond the borders of each city. For example, the City of LA rule not only applies to employers located within the geographic boundaries of the City, but also to any employee who works within the City's borders for 2 or more hours in a week. If your minimum wage employees sometimes work in LA, you have two choices: either pay the City minimum for every hour or track the number of hours spent in LA and adjust the pay accordingly.

Yet another concern: the so called hotel ordinances in Los Angeles and Santa Monica not only apply to hotels, but also to an array of businesses allied or connected with the hotel.

Additionally, government contractors may have contractual obligations to pay a higher wage. Any such business should carefully review those contracts to ensure that the correct wages are being paid.

We have prepared the charts below as an easy reference guide for changes slated to go into effect on July 1, 2017 in the cities of Los Angeles, Pasadena and Santa Monica. Be sure to check with your labor law advisor to determine whether your business is covered by a city, county or industry specific ordinance that has special minimum wage rules.

 
Los Angeles Ordinance
 
Effective Date
Minimum Wage Rate
Employers with 26+
7/1/17
7/1/18
7/1/19
7/1/20
7/1/21
7/1/22
$12.00
$13.25
$14.25
$15.00
$15.00
CPI
Employers with 25 or fewer employees
7/1/17
7/1/18
7/1/19
7/1/20
7/1/21
7/1/22
$10.50
$12.00
$13.25
$14.25
$15.00
CPI
 
 
Los Angeles Hotel Ordinance
 
Effective Date
Minimum Wage Rate
All Hotels with 150+ rooms 
7/1/17
7/1/18
$15.66
CPI
 
 
Santa Monica Ordinance
 
Effective Date
Minimum Wage Rate
Employers with 26+
7/1/17
7/1/18
7/1/19
7/1/20
7/1/21
7/1/22
$12.00
$13.25
$14.25
$15.00
$15.00
CPI
Employers with 25 or fewer employees
7/1/17
7/1/18
7/1/19
7/1/20
7/1/21
7/1/22
$10.50
$12.00
$13.25
$14.25
$15.00
CPI
 
 
Santa Monica Hotel Ordinance 
 
Effective Date
Minimum Wage Rate
All Hotels
7/1/17
7/1/18
$15.66
CPI
 
 
Pasadena Ordinance 
 
Effective Date
Minimum Wage Rate
Employer with 26+
7/1/17
7/1/18
$12.00
$13.25
Employers with 25 or less
7/1/17
7/1/18
$10.50
$12.00
 
 
Lastly, effective July 1, 2017 small employers covered by the City of Los Angeles ordinance will be required to comply with the mandatory paid sick leave law, which provides substantially more paid sick leave to employees than the California law. Click here for our bulletin on posting requirements for employers covered by the LA Ordinance. Click here for our bulletin summarizing the paid sick leave obligations under the LA Ordinance.

If you have any questions about the matters discussed in this issue of Compliance Matters, please call your firm contact at (818) 508-3700 or visit us online at www.brgslaw.com .

Sincerely, 
Richard S. Rosenberg
Katherine A. Hren
Eric W. Mueller
Ballard Rosenberg Golper & Savitt, LLP



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(818) 508-3700


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Charlotte, NC 28210
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