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Three California Municipalities Enact New Minimum Wage and Paid Sick Leave Laws

The trend toward local regulation of employment laws continues in California with three new local wage and hour enactments.

San Diego

On June 7, 2016, San Diego voters passed a ballot initiative containing two provisions for hourly workers. First, San Diego’s new minimum wage will be $10.50 per hour once the ballot results are confirmed, which is expected to be in mid-July. Second, San Diego will have its own paid sick leave policy of five days (40 hours) – which is in excess of the state law that allows employers to limit use of accrued paid sick leave to three days (24 hours).

Like the state law, San Diego’s paid sick leave will accrue at one hour for every 30 hours worked and cannot be used until after 90 days of employment. Also like the state law, San Diego’s sick leave initiative allows accrued leave to be front loaded or accrued, and it must be carried over year to year.

The San Diego law differs from state law in that employees may accrue an unlimited amount, but employers may limit the amount an employee can use to 40 hours per year. Note that even if a business is not within San Diego city limits, if an employee performs at least two hours of work per week within San Diego, they accrue paid sick leave for the hours they work within the city. This will dramatically affect delivery drivers, caterers, construction workers, or any company with a mobile workforce. (Note that in-home supportive services, workers employed under a publicly subsidized summer or short-term youth employment program, or any student employee, camp, or program counselor of an organized camp under State law are exempted.) The new law adds the administrative burden of tracking not only how much each employee works, but also where they work.

Los Angeles

Beginning July 1, 2016, Los Angeles employers with at least 26 employees – and, on January 1, 2017, employers with fewer than 26 employees – must comply with two new laws.

First, Los Angeles employers must provide six days (48 hours) of paid sick leave per year. Like the San Diego law, even if a business is not within city limits, if an employee performs at least two hours of work per week within the city, they accrue paid sick leave for the hours they work within the city limits. Like the state law and the San Diego law, the new Los Angeles law requires that all employees receive this sick leave (or participate in an equally generous PTO plan), including part-time and temporary employees, who must accrue this benefit at the rate of one hour for every 30 hours worked, and they must be able to access it after 90 days of employment. Also like the state law, the benefit may be front loaded or accrued and carried over to the next year.

Second, the new minimum wage will be $10.50 an hour starting July 1, 2016.

Santa Monica

Starting January 1, 2017, Santa Monica employers with more than 50 employees must provide nine days (72 hours) of paid sick leave. The application, accrual, and carryover procedures are the same as the San Diego and Los Angeles laws.

What to Do

The increasing trend toward localized employment regulation makes for a challenging compliance environment. Now more than ever, employers should consult counsel to stay abreast of these new and rapidly-changing laws.

ARTICLE BY Jennifer B. Rubin & Brent Douglas of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.

Los Angeles Employers Must Pay Higher Minimum Wages And Provide Expanded Paid Sick Leave

On July 1, 2016, employers who have more than 25 employees performing some work in the City of Los Angeles (the “City”) will need to provide higher minimum wages and six paid sick days per year. Employers with fewer workers in the City will need to expand sick leave benefits by July 1, 2016, but they will not be subject to minimum wage hikes until the same day next year.

Earlier this month, the City Council passed the Los Angeles Minimum Wage Ordinance (Ordinance No. 184320) (the “City Ordinance”) requiring employers to pay a higher minimum wage and provide more sick leave benefits than state law. A summary of the City Ordinance is below, but employers with questions regarding compliance should contact their employment counsel.

Minimum Wage Increases

The City Ordinance raises the minimum wage as follows:

	26 Employees Or More	25 Employees Or Less
July 1, 2016	$10.50	$10.00
July 1, 2017	$12.00	$10.50
July 1, 2018	$13.25	$12.00
July 1, 2019	$14.25	$13.25
July 1, 2020	$15.00	$14.25
July 1, 2021	$15.00	$15.00

On July 1, 2022, and every following year, the minimum wage will increase based on the Consumer Price Index for Urban Wage Earners and Clerical Workers for the City’s metropolitan area. Beginning in 2022, the City’s Office of Wage Standards of the Bureau of Contract Administration will publish additional minimum wage increases on February 1 of each year, with the increases taking effect on July 1 of each year.

Notably, this new law defines “Employee” as a person who: (1) “in a particular week performs at least two hours of work within the geographic boundaries of the City for an Employer”; and (2) qualifies as an employee entitled to receive the state-mandated minimum wage. The average number of Employees, as defined above, for the previous calendar year will be used to determine the size of an employer. Any new employer must count the total number of Employees, as defined above, during its first pay period.

The City Ordinance requires increases to the minimum wage sooner than the anticipated raises in California’s state-wide minimum wage, which will be set for employers with more than 25 employees to $10.50 on January 1, 2017, with gradual increases to ultimately $15.00 per hour on January 1, 2022. For smaller employers (25 employees or less) the gradual increases in state-wide minimum wage (much like the City Ordinance) will be delayed one year. Employers with exempt employees, however, should note that local minimum wage hikes (such as the City Ordinance) do not affect the minimum salary requirements to qualify for various wage and hour exemptions under state law. For example, the executive, administrative and professional exemptions—which permit employers to pay certain qualifying employees a salary instead of hourly wages with overtime—require a minimum monthly salary equivalent of at least twice the state-wide minimum wage.

The law also contains special provisions for nonprofit and transitional employers as well as for employers with employees who are 14 to 17 years old.

Expansion of Paid Sick Leave

The ordinance also provides six paid sick days (instead of the state-mandated three days) to Employees who, on or after July 1, 2016, work in the City for the same employer for 30 days or more within a year from his or her employment start date. The main requirements include:

Paid sick leave must accrue on the first day of employment, or July 1, 2016, whichever is later;
An Employee may use paid sick leave beginning on the 90th day of employment, or July 1, 2016, whichever is later;
An Employee may take up to 48 hours (i.e., six work days) of sick leave for themselves, a family member, or “any individual related by blood or affinity whose close association with the employee is the equivalent of a family relationship” in each year of employment, calendar year, or 12 month period;
Employers must provide paid sick leave either by: (1) granting the entire 48 hours to an Employee at the beginning of each year of employment, calendar year, or 12-month period; or (2) using an accrual rate of one hour of paid sick leave for every 30 hours worked;
If an employer has a paid leave or paid time off policy (or provides payment for compensated time off) that is at least 48 hours, no additional time is required;
Accrued unused paid sick leave must carry over to the next year, but employers may implement a cap of at least 72 hours;
An employer may require an Employee to provide reasonable documentation of the reason for sick leave (though employers still must be cautious of state medical privacy laws);
Like state law, accrued unused paid sick leave is not payable upon termination of employment; and
If the Employee separates from employment and then is rehired within one year, then the employer must reinstate the Employee’s previously accrued and unused paid sick leave.

A separate but related ordinance (the Los Angeles Office of Wage Standards Ordinance, Ordinance No. 184319) passed by the City provides for restitution and additional penalties for failure to comply with the above standards, and it also requires every Employer to post the notice published each year by the Office of Wage Standards. The notice must be in English, Spanish, Chinese (Cantonese and Mandarin), Hindi, Vietnamese, Tagalog, Korean, Japanese, Thai, Armenian, Russian and Farsi, and any other language spoken by at least five percent of the Employees at the workplace. This notice can be found online at: http://wagesla.lacity.org/.

ARTICLE BY Benjamin J. Kim of Allen Matkins Leck Gamble Mallory & Natsis LLP

Washington, D.C. Prepares to Increase Minimum Wage to $15

— and Tipped Minimum Wage to $5.00 — by July 1, 2020

Washington, D.C. is poised to join California and New York by raising its minimum wage to $15.00 per hour.

On June 7, 2016, the D.C. Council, with support of Mayor Muriel Bowser, unanimously passed on first reading the Fair Shot Minimum Wage Amendment Act of 2016 . The bill will continue to raise the District of Columbia minimum wage – currently $10.50, but previously set to increase to $11.50 on July 1, 2016 – in additional annual increments until it reaches $15.00 by July 1, 2020. Beginning on July 1, 2021, the minimum wage will increase further based on the increase in the Consumer Price Index for All Urban Consumers for the Washington Metropolitan Statistical Area.

Notably, the bill will also increase the tipped minimum wage from the existing $2.77 per hour, where it has been since 2005, in annual increments of 56 cents (55 cents in 2020) to $5.00 on July 1, 2020, again with annual indexing in successive years. This increase in the tipped minimum wage represents a compromise between advocates who sought to eliminate any lower minimum wage for tipped employees, or to at least set a higher rate of half the minimum wage as Mayor Bowser originally proposed, and significant portions of the restaurant industry that resisted any increase at all.

The law also contains special provisions for government contractors that currently are covered by D.C.’s Living Wage Act, which generally require them to pay the minimum wage if it becomes higher that the living wage (currently $13.85, but also subject to annual adjustment). In addition, for the first time, District employees are covered by the D.C. minimum wage law.

The bill still faces a second vote, likely either on June 21 or 28, 2016, at which time it is possible there may be some amendments. After Mayor Bowser signs the bill, it is subject to a Congressional review period, but is expected to take full effect well in advance of the 2017 increases.

ARTICLE BY Brian W. Steinbach of Epstein Becker & Green, P.C.

Sick Leave and Minimum Wage Update: Oregon, Vermont, Santa Monica

On Wednesday, Oregon Governor Kate Brown signed into law legislation that increases that state’s minimum wage from $9.25 to up to $14.75 by 2022, the highest of any state. The first increases go into effect on July 1, 2016. Under SB 1532 [PDF], minimum wage rates vary based upon the employer’s location, as set forth in the table below. Beginning in 2023, the rate will be indexed to inflation. The Commissioner of the Bureau of Labor and Industries has been charged with adopting rules for determining an employer’s location.

In addition, Santa Monica, California quietly passed a law raising the minimum wage and mandating paid sick leave starting July 1, 2016, adding to the regulatory maze for employers with employees in California. As currently written, Santa Monica’s sick leave law tracks San Francisco’s (arguably the most generous sick leave law in the nation), in that it does not contain an annual accrual or use cap. Instead, employees are allowed to accrue paid sick leave at the rate of one hour for every 30 hours worked, up to 40 hours (if the employer has 1-25 employees in Santa Monica) or 72 hours (if the employer has 26 or more employees in Santa Monica). If the employee reaches that cap, then uses some sick leave, the employee begins accruing leave again, up to that cap. In addition, employees are entitled to roll over all accrued, unused sick leave to the next year. As with the San Francisco ordinance, this creates difficulties for employers who wish to front-load a predetermined amount of sick leave (a practice that is permissible under California and many other sick leave laws). Of note, the City has established a working group to review and recommend technical adjustments to the adopted ordinance. The sick leave law goes into effect on July 1, 2016.

The Santa Monica law also establishes a minimum wage for employees who work at least two hours per week in Santa Monica. Large employers—those with 26 or more employees in Santa Monica—must pay a minimum wage of $10.50/hour beginning on July 1, 2016, increasing annually to $15.00/hour on July 1, 2020. Small employers—those with 25 or fewer employees in Santa Monica—must pay a minimum wage of $10.50/hour beginning on July 1, 2017, increasing annually $15.00/hour on July 1, 2021. Beginning July 1, 2022, and each year thereafter, the minimum wage will increase based on Consumer Price Index (CPI). The working group is also reviewing the minimum wage portion of the law.

Finally, Vermont is on the verge of becoming the fifth state (following California, Connecticut, Massachusetts and Oregon) to require private employers to provide paid sick leave for employees. All that is left is for Governor Shumlin to sign the legislation [PDF], which he is expected to do. Vermont’s sick leave law differs somewhat from laws in other jurisdictions in that 1) it only requires paid sick leave for employees who work an average of at least 18 hours/week, 2) employees accrue sick leave at a rate of one hour for every 52 worked (one hour for every 30 worked is the most common rate of accrual) and 3) it allows employees to use leave to accompany a parent, grandparent, spouse or parent-in-law to long-term care related appointments.

In addition, the law has a stepped approach for implementation. First, for small employers (those with 5 or fewer employees) the law does not go into effect until January 1, 2018; the effective date for all other employers is January 1, 2017. Second, through December 31, 2018, employees may only accrue and use up to 24 hours of paid sick leave per year; beginning January 1, 2019, that amount increases to 40 hours per year.

Article By Shennan Harris of Squire Patton Boggs (US) LLP

New Year, New Wages : Minimum Wage Rates Around the States

After ringing in 2016, employers may want to skip the eggnog and check their wages to make sure they are properly paying their employees. On Jan. 1, the minimum wage rates in 14 states went up and all are higher than the federal minimum wage. These states and rate increases include:

Alaska	$9.75 per hour
Arkansas	$8.00 per hour
California	$10.00 per hour
Connecticut	$9.60 per hour
Hawaii	$8.50 per hour
Massachusetts	$10.00 per hour
Michigan	$8.50 per hour
Nebraska	$9.00 per hour
New York	$9.00 per hour
Rhode Island	$9.60 per hour
Vermont	$9.60 per hour
West Virginia	$8.75 per hour

The minimum wage rates in both Colorado and South Dakota will increase due to a cost of living adjustment tied to inflation. For 2016, Colorado’s minimum wage is $8.31 per hour and South Dakota’s minimum wage now is $8.55 per hour.

Other notable minimum wage increases that will occur throughout 2016 include:

District of Columbia

$11.50 per hour, effective July 1, 2016

Maryland

$8.75 per hour, effective July 1, 2016

Minnesota

$9.50 per hour for large employers, effective August 1, 2016

$7.75 per hour for small employers, effective August 1, 2016

Finally, for employers who have federal service contracts, the minimum wage for employees has increased to $10.15 per hour. These employers should pay close attention to the hourly rates in effect for the applicable contract as some rates will be higher than the minimum wage rate.

Article By Tina A. Syring of Barnes & Thornburg LLP

New York Becomes First State Raise Minimum Wage to $15 . . . For Fast Food Workers

A panel appointed by New York Governor Andrew Cuomo recommended a minimum hourly wage increase to $15 for fast food service workers on Wednesday. The recommendation comes just three months after Governor Cuomo tasked the state’s acting Labor Commissioner to empanel a Wage Board to investigate and make recommendations on increasing the minimum wage in the fast food industry.

The Labor Commissioner now has to adopt the recommended changes, but it is largely expected that he will, even if he first makes minor changes. The minimum wage hike would be phased in over time, with the first increase to $10.50 for City fast food workers and to $9.75 for State fast food workers coming at the end of the year. The minimum wage rate for City workers would then rise by $1.50 each year for the next three years until it tops out at $15 in 2018. For the rest of the State, the wage rate would rise incrementally each year until it tops out at $15 in 2021.

The wage order covers Fast Food Employees working in Fast Food Establishments. Fast Food Establishments mean any establishment in the state of New York serving food or drink items:

where patrons order or select items and pay before eating and such items may be consumed on the premises, taken out, or delivered to the customer’s location;
which offers limited service;
which is part of a chain; and
which is one of thirty (30) or more establishments nationally, including: (i) an integrated enterprise which owns or operates thirty (30) or more such establishments in the aggregate nationally; or (ii) an establishment operated pursuant to a Franchise where the Franchisor and the Franchisee(s) of such Franchisor owns or operate thirty (30) or more such establishments in the aggregate nationally.

Fast Food Employee covers anyone whose job duties include at least one of the following: customer service, cooking, food or drink preparation, delivery, security, stocking supplies or equipment, cleaning, or routine maintenance.

San Francisco, the City of Los Angeles and Seattle each have raised their minimum wage rates to $15 for all employees. But New York becomes the first state to do so, even though it is limited to the fast food industry. Many believe this hike will serve as a precursor to wage hikes in other low wage industries and possibly state-wide. Similar efforts are being made on the left coast, where on the same day that the New York Wage Board released its recommendations, the County of Los Angeles Board of Supervisors voted for a $15 minimum wage. Moments later, the University of California, which employs nearly 200,000 workers statewide, announced that it will pay its workers at least $15/hr. We will continue to track these developments.

ARTICLE BY Michael S. Arnold of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.

Minor League Baseball Players’ Minimum Wage, Overtime Claims Proceed to Class Certification Stage

Former minor league baseball players are one step closer to gaining class certification of their wage and hour lawsuit against 22 Major League Baseball (“MLB”) franchises. The players allege that the franchises have been paying them less than minimum wage, denying them overtime pay, and requiring them to train during off-season without any pay. They contend the MLB and its clubs violated the FLSA, as well as similar state wage and hour laws in eight states by paying them a total of only $3,000 to $7,000 over the course of a five-month season despite workweeks of 50 to 70 hours.

On July 13, a California federal district court denied a motion by the baseball franchises to dismiss the high-profile suit for failure to pay minimum wages and overtime pay under the Fair Labor Standards Act and state wage and hour laws, allowing the players to proceed to discovery “to determine whether certification is appropriate and whether the proposed class representatives have standing to represent the various proposed classes.” Senne v. Kansas City Royals Baseball Corp., No. 3:14-cv-00608 (N.D. Cal. July 13, 2015).

On May 2, the court dismissed claims against eight of the MLB franchises, finding they did not have sufficient contacts with California, where the suit is pending, to establish personal jurisdiction over them. In the July 13 ruling, however, the court denied Defendants motion to dismiss stating that “the named plaintiffs who are proposed as class representatives of the various state classes seek to represent unnamed plaintiffs who were employed by these other franchise defendants on the basis that they suffered a similar injury. As to these claims, the court ruled that it is appropriate to defer addressing the question of standing until after class certification.” (Senne, p. 25). As a result, the players have established sufficient standing to pursue discovery by claiming that at least one of the named plaintiffs was denied minimum wages or overtime pay from each of the remaining 22 defendants, and that at least one of the named plaintiffs was employed in each of the states for which the players assert state wage and hour violations.

The franchises have yet to reveal their defense to the specific claims; however, they may argue the players are exempt from FLSA’s minimum wage and overtime requirements because they are employed by a “seasonal amusement or recreational establishment.” Employees of establishments that operate for up to seven months per calendar year, or whose average receipts for any six months of the calendar year are not more than one-third its average receipts for the other six months of the year, are exempt from the FLSA’s minimum wage and overtime requirements.

Rulings on the applicability of the exemption to non-player employees in baseball have been inconsistent. In 1998, members of the Cincinnati Reds maintenance staff sued the team, demanding overtime pay. An Ohio district court initially ruled in favor of the Reds, describing the team as “an amusement or recreational establishment” that played its games during a season that lasted seven months or less. That decision was overruled when the United States Court of Appeals conducted a detailed accounting analysis of the team’s operation and determined that the Reds did not qualify for a seasonal exemption.

The Detroit Tigers won a similar lawsuit in 1997 when bat boys sought overtime pay for their work in excess of 40 hours in a week. The Tigers claimed the seasonal exemption as a defense and were successful as the court recognized that Tiger Stadium only operated on a seven-month schedule, making its operation seasonal.

The Sarasota White Sox, a former minor league franchise in the Florida State League, also won a lawsuit by claiming a seasonal exemption in 1995 when a groundskeeper sued for overtime. The court ruled that the team played in a six-month season and made 99 percent of its revenue during that time period.

The question of whether the franchises will be safe from potentially significant wage and hour liability in this latest litigation may be a close call.

ARTICLE BY Keith L. Hammond & Gregg E. Clifton of Jackson Lewis P.C.

Minimum Wage Surges in 2015 and Beyond

Multi-state employers take note: changes in the minimum wage will take effect this year. At the state level, advocates pushing for an increase in the minimum wage saw significant victories in 2014 and many increases will take effect in the coming weeks.

Minimum Wage Surges

A comprehensive list of past, current and future wage increases is available here. Employers should also ensure they comply with applicable notice requirements and update their postings, which are generally available on the respective agency websites.

Employers should note the following state and local minimum wage increases in 2015, with additional increases occurring in 2016 and beyond. Furthermore, several states, including New York and New Jersey, will see annual cost-of-living increases to their minimum wage.

- Alaska: Effective February 24, 2015, the minimum wage will increase to $8.75/hour and $9.75/hour on January 1, 2016.
- Arkansas: Effective January 1, 2015, the minimum wage will increase to $7.50/hour. Subsequent increases will bring the minimum wage to $8.00 in 2016 and $8.50 in 2017.
- California: In July 2014, California employees saw an increase in the minimum wage to $9.00/hour. Effective January 1, 2016, this rate will rise to $10.00/hour.

Oakland, California: Effective March 2, 2015, the minimum wage will increase to $12.25/hour and will increase in subsequent years based on cost-of-living increases.
San Francisco, California: Over the next four years, San Francisco employees will see a gradual rise in the minimum wage to $15.00/hour. In addition, effective January 1, 2015, employers in San Francisco must pay employees who work at least two hours a week (with limited exceptions) at least $11.05/hour. OnMay 1, 2015, the minimum wage will increase to $12.25/hour. The next bump, to $13.00/hour, will take place on July 1, 2016. On July 1, 2017, the minimum wage will increase to $14.00/hour, and, finally, on July 1, 2018, the minimum wage will increase to $15.00/hour.

Delaware: Effective June 1, 2015, the minimum wage will increase to $8.25/hour.
Illinois: Chicago employees will see a gradual increase in the minimum wage over the next five years. Chicago’s employees will receive their first increase on July 1, 2015, when the rate goes to $10.00/hour. The rate will increase to $10.50/hour in 2016, to $11.00/hour in 2017, to $12.00/hour in 2018, and to $13.00/hour in 2019.
Maryland: Effective January 1, 2015, the minimum wage will increase to $8.00/hour and to $8.25/hour onJuly 1, 2015. Subsequent increases will bring the minimum wage to $8.75 in 2016, $8.25 in 2017, and $10.10 in 2018.
Minnesota: Large employers (annual gross revenue of $500,000 or more) will see an increase in the minimum wage to $9.00/hour on August 1, 2015 and $9.50/hour on August 1, 2016. Small employers (annual gross revenue of $500,000 or less) will see an increase in the minimum wage to $7.25/hour on August 1, 2015 and $7.75/hour on August 1, 2016. Minnesota employers should take note that if the combined amount of its gross revenue is more than $500,000, starting August 1, 2014, it must pay the “large” Minnesota employer minimum wage rate. In addition, for those employees who are under the age of 20, Minnesota will increase the 90 day training wage to $7.75/hour on August 1, 2015 and $7.75/hour on August 1, 2016.
Nebraska: Effective January 1, 2015, the minimum wage will increase to $8.00/hour and to $9.00/hour on January 1, 2016.
New York: Effective December 31, 2015, the minimum wage will increase to $9.00/hour.
South Dakota: Effective January 1, 2015, the minimum wage will increase to $8.50/hour.
Washington, D.C.: Effective July 1, 2015, the minimum wage will increase to $10.50/hour and to $11.50/hour on July 1, 2016.
West Virginia: Effective January 1, 2015, the minimum wage will increase to $8.00/hour and to $8.75/hour on January 1, 2016.

Locally, Milwaukee County voters strongly supported a ballot referendum in November endorsing a statewide increase of the minimum wage to $10.10 an hour; however, it is unlikely that the Wisconsin Legislature will vote to increase the minimum wage during the next term.

At the national level, President Obama will face an uphill battle in passing a higher federal minimum wage under the next Congressional term. Given the outcome in the 2014 elections, any additional increases in the minimum wage over the next two years will likely be dependent upon further changes to state and local laws.

ARTICLE BY

Rebeca M. Lopez

Deborah Rehorst

Godfrey & Kahn S.C.

Four States and Two Major Cities Approve Minimum Wage Increases

Voters in the states of Alaska, Arkansas, Nebraska, and South Dakota voted in favor of ballot initiatives that will increase the state minimum wage. Alaska’s minimum wage will increase from $7.75 to $9.75 an hour by 2016, Arkansas’s from $6.25 to $8.50 by 2017, Nebraska’s from $7.25 to $9.00 by 2016, and South Dakota’s from $7.25 to $8.50 next year.

Those four states join 12 others and Washington, D.C., all of which have increased their minimum wage in the past two years. For example, New Jersey’s 2013 ballot initiative to raise the state minimum to $8.25 passed by more than 60 %, and in 2006, state initiatives to raise the minimum wage passed by large majorities in Arizona (65.6%), Missouri (75.6 %), Montana (74.2 %), Nevada (68.4 %), and Ohio (56.5 %).

Voters in San Francisco overwhelmingly approved a ballot initiative to raise the city’s minimum wage to $15 an hour, the highest level in the nation, on the heels of Seattle’s June decision to raise its minimum wage to $15. As with Seattle’s minimum wage, San Francisco’s will be phased in gradually, from its current rate of $10.74 an hour to $11.05 on January1 and $12.25 in May before increasing every year until reaching $15 in 2018.

On December 2, 2014, the Chicago City Council overwhelmingly approved raising the City’s minimum wage from the current state-wide rate of $8.25 an hour to $13 by mid-2019. Chicago workers will see their first increase next July, when the minimum wage will increase to $10, then increase by 50 cents each of the two years after that, and $1 the next two years.

This minimum wage initiative has also received some pushback. For example, Hotel industry groups on December 16 sued the city of Los Angeles in federal court over the city’s enactment of a minimum wage ordinance requiring large non-union hotels to pay their workers $15.37 an hour. In their lawsuit, the American Hotel & Lodging Association and the Asian-American Hotel Owners Association allege the city ordinance violates federal labor, contract and equal protection laws.

The hotel minimum wage ordinance, which passed the City Council in October on an 11-2 vote, is estimated to cover about 80 large hotels in the city. Starting in July, hotels with more than 300 rooms must pay workers the higher minimum wage; in July 2016 the measure kicks in for hotels with as few as 125 rooms. Hotel Industry groups contend that by allowing exemptions for hotels with union collective bargaining agreements, the ordinance creates an economic disadvantage for non-union hotels, thus forcing their hand to permit union organizing.

These minimum wage increases are not expected to make it more likely that Congress will pass President Obama’s proposed federal minimum wage increase to $10.10, particularly given the results of this past November’s mid-term elections. However, the minimum wage will certainly remain a hot-button issue for the next two years, and a campaign issue during the 2016 Presidential campaign.

ARTICLE BY

Robert W. Mulcahy

Carlos R. Pastrana-Torres

Michael Best & Friedrich LLP

New Jersey Employers: $8.38 Minimum Wage Effective January 1

As you may remember, in November 2013, voters approved an amendment to the New Jersey Constitution increasing the state minimum wage to $8.25. The amendment also created annual cost of living increases, tied to the Consumer Price Index, to be added to the minimum wage each year. The increases are calculated each September and take effect on the following January. Therefore, effective January 1, 2015, New Jersey minimum wage will rise from $8.25 to $8.38. Employers must ensure that all work performed by employees on and after January 1, 2015 is compensated at the increased rate. Employers should be especially mindful of this change if January 1 falls in the middle of a pay period.

ARTICLE BY

Saranne E. Weimer

Giordano, Halleran & Ciesla, P.C.

Tag: minimum wage

Three California Municipalities Enact New Minimum Wage and Paid Sick Leave Laws

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