Employee law expert weighs in on new OT laws, potential minimum wage increase
Important Laws that Would Increase the Local Minimum Wage, and Raise the Minimum Base Salary for Exempt Employees
By: Robert Rose | The Rose Group, APLC
California employers are subject to both the federal and California wage and hour laws. Also, local entities (cities and counties) are allowed to enact minimum wage rates which establish a higher minimum wage rate for employees working within their local jurisdiction. The effect of this multiple coverage by different levels of government is that, California employers must follow the strictest wage laws; that is, California employers must comply with the federal, State, and local wage laws that give the most protection to employees.
If the following pending proposed changes to the wage and hour laws go into effect, San Diego employers, including medical practices, will have to make some adjustments, to the extent their current pay practices would no longer be totally complaint with applicable laws.
MINIMUM WAGE INCREASE
Currently, the California hourly minimum wage rate is $10.00, which took effect on January 1, 2016. On June 7, 2016, City of San Diego voters will vote on the City Council’s proposed minimum wage increase ordinance. If the voters approve, the minimum wage for workers in San Diego will immediately increase to $10.50 per hour, and further increase to $11.50 per hour in January 2017. Please take note of this pending development if you employ any workers at minimum wage.
INCREASE IN MINIMUM SALARY FOR EXEMPT EMPLOYEES
Currently, to be salaried exempt in California, an employee must fit the statutory definition for executive, professional and administrative employees, AND earn a minimum salary of two times the California minimum wage (based on a 40 hour workweek) –which amounts to $41,600 a year. Salaried workers properly classified by their employers as exempt are not entitled to weekly or daily overtime compensation regardless of the number of hours they work each week. On December 1, 2016, the U.S. Department of Labor will increase to $47,476 the minimum salary to qualify a position as exempt under federal wage laws. Employers who want to maintain the exempt status of any employees earning below the new federal minimum salary for exempt employee will need to raise the minimum salary paid to those workers or convert them to hourly workers eligible for overtime pay. Please take note of this development if you employ any workers on a salaried exempt basis who are paid a salary below $47,476.
Contact Ken Rose ([email protected]) and Robert Rose ([email protected]) at The Rose Group (619.822.1088) should you need expert guidance for complying with these important legal developments.
The Rose Group is a San Diego based Law Firm specializing in Labor and Employment Law. We regularly consult with medical practices and other businesses on compliance with the myriad of federal and California employment laws, including the wage and hour laws.