Will California’s Minimum Wage Raises for Health Care Workers Be Delayed?

[Editor’s note: The minimum wage increase for health care workers initially was delayed until July 1. Subsequently, the increase was delayed further.]

The June 1 effective date for raising the minimum wages for nearly all health care workers in California is close. Early this year, Gov. Gavin Newsom announced his intent to postpone the increases, but so far, there’s no delay, although negotiations for one are ongoing.

We’ve gathered articles on the news from SHRM Online and other outlets.

Law Encompasses Many Roles

This minimum wage law, which Newsom signed last year, doesn’t just apply to nurses, physicians, caregivers, medical residents, interns, and fellows. It also applies to workers who provide support to health care facilities in additional roles. These workers include janitors, housekeepers, groundskeepers, security guards, clerical workers, nonmanagerial administrative workers, food service workers, gift shop workers, technical and ancillary services workers, medical coding and medical billing staff, schedulers, call center and warehouse workers, and laundry workers. The law also extends the definition of “employees” to include independent contractors.

(SHRM Online)

Different Ranges of Pay Raises

The law provides different covered health care facilities various ranges of pay raises based on the type of facility. The types of facility are “health care facility employers,” “hospitals,” “clinics,” “skilled nursing facilities,” and “others,” as defined by the law. Beginning June 1, the minimum pay for health care facility employers is $23 per hour; for hospitals, it’s $18 per hour; and for clinics, skilled nursing facilities, and others, it’s $21 per hour.

The pay range increases vary in second and third stages until skilled nursing facilities and others reach at least $25 per hour by June 1, 2028. Health care facility employers and clinics reach a minimum of $25 per hour sooner. Hospitals—institutions with a high governmental payor mix, rural independent covered health care facilities, or health care facilities in counties with fewer than 250,000 people as of Jan. 12, 2023—don’t reach at least $25 per hour until June 1, 2033.

(Fisher Phillips)

Cost-Cutting Measures Possible

Nearly 500,000 employees who are supposed to benefit from California’s minimum wage law for health care workers might face cuts to hours and benefits due to increased costs to comply. A partially successful legal challenge to a minimum wage ordinance in Inglewood, Calif., suggests layoffs and reductions in hours and benefits, including cuts to premium pay and vacation time, could result from the state law.

(California Healthline)

Will the Law Be Delayed?

In light of a budget shortfall in California, Newsom reportedly is seeking changes to the state minimum wage law for health care workers, including the delay of the initial compliance date of June 1. When Newsom recently presented his latest state budget proposal, he said negotiations around potential changes to the minimum wage law for health care workers are taking place. He promised a deal between his administration, the Legislature, and proponents of the law soon. Lawmakers and Newsom would have to pass and sign legislation that would push back the start date within two weeks to delay it effectively.

Some lawmakers on May 20 moved to push the date for the first in the series of pay increases from June 1 to July 1. The state’s new fiscal year begins on July 1.

(The National Law Review, CalMatters, and The Sacramento Bee)