California Gov. Jerry Brown Signs State’s $15 Minimum Wage Law
On April 4, 2016, Governor Jerry Brown signed SB 3, a bill that will increase the minimum wage in California from $10 to $15 per hour by the year 2022 for businesses with more than 25 employees and by 2023 for smaller businesses.
SB 3 calls for an increase of $0.50 per hour beginning next year, January 1, 2017, and an increase of $0.50 per hour in January 2018. Thereafter, the increase each year will be $1 per hour until 2022.
Businesses employing 25 or fewer people have an additional year to phase in each increase and are therefore not required to begin the increases until 2018.
The minimum wage increase also affects the standard for exempt status. For example, in order to be exempt from being paid overtime under the executive, administrative and professional exemptions, the employee must be paid at least twice the minimum wage per month. This means that in 2022 the minimum annual salary to be considered an exempt employee in California will rise to $62,400.