In April 2016, California enacted legislation (CA SB 3) raising the state’s minimum wage rate each year for the next five years. Consistent with this enactment, the Department of Industrial Relations (DIR) amended the General Minimum Wage Order and each of the industry and occupation orders (IWCs) to reflect the minimum wage rates established under the new law. The DIR has revised the general minimum wage notice to reflect the minimum wage rates for the next two years.
Minimum Wage Schedule
The minimum wage rate that employers must pay employees starting January 1, 2017, depends on the number of employees that work for the employer –
- The minimum wage rates for large employers (employers with 26 or more employees) for 2017 and 2018 are $10.50 and $11.00, respectively.
- The minimum wage rates for small employers (employers with 25 or fewer employees) for 2017 and 2018 are $10.00 and $10.50, respectively.
The minimum wage increases for each of the next two years is about five percent over the prior year’s minimum wage rate. By 2022, the minimum wage rate for large employers is scheduled to increase to $15.00 per hour. The minimum wage rate for small employers will reach $15.00 in 2023.
Meal and Lodging Credits
The General Minimum Wage Order and individual industry and occupation orders have also been amended to reflect new meal and lodging credits. Meal and lodging credits may be used to meet part of the employer’s minimum wage obligation. In determining the credit increases, regulations require the DIR to adjust upwards the meals and lodging credits by the same percentage as the increase in the minimum wage. Like wage rates, meal and lodging credits are based on employer size.
The general minimum wage notice should be posted in the workplace next to the applicable industry or occupation order (IWC). CPC makes compliance with this obligation easy. New California All-On-One Posters feature the updated minimum wage notice. Existing California All-On-One Posters can be updated with the 2017 Minimum Wage Peel ‘N Post. CPC will also have new IWC posters once these updates have been released by the DIR.