May 20, 2022

The Increasing California Minimum Wage?

On May 12, 2022 Governor Newsom announced that “California’s minimum wage is projected to increase to $15.50 per hour for all workers on January 1, 2023.” This increase comes in response to a provision in the state’s existing minimum wage law that allows for an accelerated increase in the minimum wage when inflation in the state exceeds 7 percent.

The Governor’s office cites the ongoing COVID-19 pandemic, persistent supply chain disruptions and labor market frictions as the reasons for the state’s 40 year inflation rate highpoint.

Employers should also be aware of rising local minimum wage increases effective July 1, 2022[i]. Additional information on local minimum wage rates are cataloged by the UC Berkley Labor Center which provides a comprehensive inventory of US city and county minimum wage orders.

Employers will want to consider taking the following steps to prepare for increased minimum wage requirements:

  1. Update all required employee notices – including workplace postings – to assure compliance.
  2. Confirm with internal payroll processors and external payroll services that all new minimum wage amounts will be reflected on employee wage statements.
  3. Perform an internal audit to assure that employees working outside of the company’s home city/county are being paid the correct minimum wage.

Employers with questions about wage and hour compliance should contact Western Growers.

[i] Los Angeles City, Los Angeles County, Santa Monica, Malibu, Pasadena and West Hollywood are a few examples of those local jurisdictions with July 1, 2022 minimum wage increases.