Both California and New York have enacted legislation raising each state’s minimum wage to $15 an hour, the highest state minimum in the country.
California Law Provides for Gradual Increases
Democratic Gov. Jerry Brown signed Senate Bill (S.B.) 3 on April 4. It provides for gradual increases to the state wage rate until it hits $15 an hour in 2022 or 2023.
“This plan raises the minimum wage in a careful and responsible way and provides some flexibility if economic and budgetary conditions change,” Brown said in a statement.
The law will raise the wage rate every January starting in 2017 until it reaches $15 an hour for employers with more than 25 workers in 2022. Employers with 25 or fewer workers would have until 2023 to reach the $15 level.
The measure also sets mandatory paid sick days at three per year.
California’s minimum wage law has a built-in “pause” button under which the increases could be stopped for a year if the state goes into a recession or there is a serious budget crisis.
Lawmakers approved S.B. 3 mostly along party lines only four days after the bill was introduced. Only one Democrat in the Assembly voted against it, as did all Republicans.
During debate on the floor of the California legislature, Republicans who opposed the bill acknowledged concerns about income inequality and poverty but said they disagreed with the rushed and “one-size-fits-all” approach of the legislation. Some called for regional rates based on the cost of living in different areas of the state.
“A blanket approach presents yet another jobs roadblock for a very large number of California communities,” Senate Republican Leader Jean Fuller said in a statement.
The slow implementation of the increases recognizes that some parts of California may be more affected by economic slowdowns than other parts, Brown said.
New York Law Also Requires Paid Family and Medical Leave
New York’s Democratic governor, Andrew Cuomo, signed Senate Bill 6406 into law on April 4, as well. It was approved by the state Senate March 31 and the state Assembly April 1.
The measure gradually raises New York’s minimum wage to $15 an hour for most workers. It also requires employers to provide workers with 12 weeks of paid family and medical leave.
Under the law, the minimum wage for workers in New York City will rise to $11 on Dec. 31, 2016, for employers with 11 or more employees and by $2 per year at the end of 2017 and 2018. For New York City employers with 10 or fewer employees, the minimum wage will increase to $10.50 in December of this year and by $1.50 annually over the following three years.
The minimum wage will increase more gradually in the three counties surrounding the city and even more gradually in the upstate region of the state.
In Nassau, Suffolk and Westchester counties, it will increase to $10 this year and then rise by $1 annually over the next five years. Upstate, it will increase to $9.70 this year and then rise by 70 cents each year for four years until it reaches $12.50.
In a concession to upstate lawmakers and businesses, the minimum wage there will not rise to $15 until a study is conducted by the state and a new indexed schedule is set.
The law contains a similar provision to the “pause” provision in the California law, which provides that the state will conduct annual economic studies beginning in 2019 to determine if the scheduled increases should be suspended due to a lagging economy.
The measure also provides for the phase-in of paid family leave. Beginning in 2018, workers will get eight weeks of leave at a pay rate of at least 50 percent of their average weekly wage, with a cap of 50 percent of the statewide average weekly wage.
When the leave provision becomes fully effective in 2021, employers will have to provide 12 weeks of leave at a rate of pay equal to at least 67 percent of an employee's average weekly wage, capped at 67 percent of the statewide average weekly wage.
Employees will be eligible for leave after six months of employment with a single employer.
The paid-leave program will be funded by a payroll deduction of 0.5 percent on employees.
Paid family leave will be available to care for an infant, to care for a family member with a serious health condition or for “any qualifying exigency” resulting from a family member being called to active military service.
Joanne Deschenaux, J.D., is SHRM’s senior legal editor.