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Nothing Escapes Inflation, Including California’s Minimum Wage

By Kate Gold, Philippe A. Lebel & Morgan Peterson on May 17, 2022
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California’s minimum wage currently is double its federal counterpart.  And, it’s going to keep climbing.  Late last week, Gov. Newsom announced that the Golden State’s minimum wage will increase to $15.50 for all employers (regardless of size), effective January 1, 2023.  Employers have inflation to thank for this latest hike.

California currently mandates a minimum wage of $15 per hour for employers with 26 or more employees, and $14 per hour for smaller employers.  The minimum wage was set to increase to $15 per hour for all employers, regardless of size, beginning January 1, 2023—a $1 per hour increase for small employers.  Now, that number will be $15.50 per hour regardless of employer size.

How did we get here?  The answer is a 2016 statute signed into law by former Gov. Jerry Brown, Senate Bill 3 (“SB 3”).  SB 3, which amended sections 245.5, 246, and 1182.12 of the Labor Code, set forth a plan to gradually increase the statewide minimum wage to $15 per hour over the past six years.  SB 3 also included a provision requiring an automatic increase in the minimum wage of up to 3.5% to account for any increase in inflation over 7%, as determined by the Consumer Price Index.  This provision is the cause of the latest increase.

Some localities in California, including the City of Los Angeles, are mandating even greater increases.  This July, the minimum wage in Los Angeles will rise to $16.04 per hour for all covered employees.  Meanwhile, in Berkeley and San Francisco, the minimum wage will increase to $16.99, among the highest in the nation, effective July 1, 2022.

Photo of Kate Gold Kate Gold

Kate Gold is a partner in the Labor & Employment Law Department in the Los Angeles office.

Kate has over 25 years of experience representing clients in a range of industries, across all areas of employment law.  An experienced litigator, she has represented…

Kate Gold is a partner in the Labor & Employment Law Department in the Los Angeles office.

Kate has over 25 years of experience representing clients in a range of industries, across all areas of employment law.  An experienced litigator, she has represented clients in all types of employment-related suits, including class and collective actions, discrimination, retaliation and harassment, non-compete and wage/hour matters.  In addition to litigating, she conducts high-level workplace investigations and routinely counsels clients on matters involving the full range of state and federal employment issues.

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Photo of Philippe A. Lebel Philippe A. Lebel

Philippe (Phil) A. Lebel represents employers in all aspects of employment litigation, including wage and hour, wrongful termination, discrimination, harassment, retaliation, defamation, trade secrets, and breach of contract litigation, in both the single-plaintiff and class- and/or representative-action context, at both the trial and…

Philippe (Phil) A. Lebel represents employers in all aspects of employment litigation, including wage and hour, wrongful termination, discrimination, harassment, retaliation, defamation, trade secrets, and breach of contract litigation, in both the single-plaintiff and class- and/or representative-action context, at both the trial and appellate level, and before administrative agencies.

In addition to his litigation work, Phil regularly advises clients regarding compliance with federal, state and local employment laws, and assists a variety of companies and financial firms in evaluating labor and employment issues in connection with corporate transactions. Phil also has experience assisting employers with sensitive employee investigations and trainings.  Phil also represents employers in connection with labor law matters, such as labor arbitrations and proceedings before the National Labor Relations Board.

Phil has assisted clients in a wide array of sectors including in the biotech, education, entertainment, financial services, fitness, healthcare, high-tech, legal services, manufacturing, media, professional services, sports, and staffing industries, among others.

Phil regularly speaks on emerging issues for employers and has been published or quoted in Law360, the Daily Journal, The Hollywood Reporter, Business Insurance, and SHRM.org regarding a variety of labor and employment law topics.

During college, Phil worked on political campaigns in Atlanta, Georgia and Birmingham, Alabama, and was an intern with the National Gay and Lesbian Task Force and the Gay and Lesbian Victory Fund. Phil is a former member of the Board of Directors of the AIDS Legal Referral Panel.

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Morgan Peterson

Morgan Peterson is a law clerk in the Labor Department and a member of the Employment Litigation & Arbitration Group.

Read more about Morgan PetersonEmail
  • Posted in:
    Employment & Labor
  • Blog:
    California Employment Law Update
  • Organization:
    Proskauer Rose LLP
  • Article: View Original Source

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