Minimum Wage

Although there are some exceptions, almost all employees in California must be paid the minimum wage as required by state law. Effective January 1, 2022, the minimum wage for all industries was increased to $14/hour for employers employing 25 or fewer employees, and $15/hour for employers employing 26 or more employees.

Effective January 1, 2023, the minimum wage will be increased to $15/hour for employers employing 25 or fewer employees and the will be the same for employers employing 26 or more employees.

The scheduled increases may be temporarily suspended by the Governor, based on certain determinations.

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For more information and guidance on how to count employees for the purpose of determining whether an employer qualifies as an employer with 25 employees or less please consult with an experienced employment law attorney.

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There are some employees who are exempt from the minimum wage law, such as outside salespersons, individuals who are the parent, spouse, or child of the employer, and apprentices regularly indentured under the State Division of Apprenticeship Standards.

There is an exception for "learners", regardless of age, who may be paid not less than 85 percent of the minimum wage rounded to the nearest nickel during their first 160 hours of employment in occupations in which they have no previous similar or related experience.

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There are also exceptions for employees who are mentally or physically disabled, or both, and for nonprofit organizations such as sheltered workshops or rehabilitation facilities that employ disabled workers. Such individuals and organizations may be issued a special license by the Division of Labor Standards Enforcement authorizing employment at a wage less than the legal minimum wage.

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                                                                                    Common FAQ:

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Q: What is the difference between the local, state and federal minimum wage?

A: Most employers in California are subject to both the federal and state minimum wage laws. Local entities (cities and counties) are also allowed to enact minimum wage rates and several have recently adopted ordinances which establish a higher minimum wage rate for employees working within their local jurisdiction.

Thus, since California's current law requires a higher minimum wage rate than does the federal law, all employers in California who are subject to both laws must pay the state minimum wage rate unless their employees are exempt under California law.

Similarly, if a local entity (city or county) has adopted a higher minimum wage, employees must be paid the local wage where it is higher than the state or federal minimum wage rates.

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Q: Are there any employees who are exempt from the minimum wage laws in California?

A: Yes, there are some employees who are exempt from the California minimum wage requirements. They include:

• “Outside salespersons” (individuals who spend more than half of their working hours away from the Employer’s place of business, selling items or obtaining orders)

• individuals who are the parent, spouse, or child of the employer

• "apprentices" regularly indentured under the State Division of Apprenticeship Standards.

• "learners", regardless of age, who may be paid not less than 85 percent of the minimum wage rounded to the nearest nickel during their first 160 hours of employment in occupations in which they have no previous similar or related experience.

• employees who are mentally or physically disabled, or both, and for nonprofit organizations such as sheltered workshops or rehabilitation facilities that employ disabled workers. Such individuals and organizations may be issued a special license by the Division of Labor Standards Enforcement authorizing employment at a wage less than the legal minimum wage

• Participants in national service programs such as AmeriCorps

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Q: May an employee in California agree to receive less than the minimum wage?

A: No. The minimum wage is an obligation of the employer and cannot be waived by any agreement, including collective bargaining agreements.

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Q: Is the minimum wage the same for both adult and minor employees?

A:  Yes. There is no distinction made between adults and minors when it comes to payment of the minimum wage.

Q: Can restaurant owners/operators in California use a waitperson’s tips to offset the obligation to pay the minimum wage?
A: No. Employers may not use an employee's tips as a credit toward its obligation to pay the minimum wage.

Q: What action can an employee take if the employer does not pay the minimum wage?
A: An employee can either file a wage claim with the Division of Labor Standards Enforcement (the Labor Commissioner's Office), or file a lawsuit in court against the employer to recover the lost wages. Additionally, if the employee no longer works for this employer, the employee can make a claim for the "waiting time penalty."

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Q.  What is the procedure that is followed after an employee files a wage claim?
A.  After a claim is completed and filed with a local office of the Division of Labor Standards Enforcement (DLSE), it will be assigned to a Deputy Labor Commissioner who will determine how best to proceed.

Initial action taken regarding the claim can be:

(i) referral to a conference

(ii) referral to a hearing, or

(iii) dismissal of the claim.

If the decision is to hold a conference, the parties will be notified by mail of the date, time and place of the conference. The conference is held to determine the validity of the claim, and to see if it can be resolved without a hearing. If the claim is not resolved at the conference, the matter is usually referred to a hearing.

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At the hearing the parties and witnesses testify under oath, and the proceeding is recorded. After the hearing, an Order, Decision, or Award (ODA) of the Labor Commissioner will be served on the parties.

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Either party may appeal the ODA to a civil court of competent jurisdiction. The court will set the matter for trial, with each party having the opportunity to present evidence and witnesses. The evidence and testimony presented at the Labor Commissioner's hearing will not be the basis for the court's decision.

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In the case of an appeal by the employer, DLSE may represent an employee who is financially unable to afford counsel in the court proceeding.

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Q.  What can an employee do if they prevail at the hearing and the employer doesn't pay or appeal the Order, Decision, or Award?
A.  When the Order, Decision, or Award (ODA) is in the employee's favor and there is no appeal, and the employer does not pay the ODA, the Division of Labor Standards Enforcement (DLSE) will have the court enter the ODA as a judgment against the employer. This judgment has the same force and effect as any other money judgment entered by the court. Consequently, the employee may either try to collect the judgment themselves or the employee can request it to be assigned to DLSE.

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Q.  What can an employee do if their employer retaliates against them after the employee informs the employer that they are going to file a wage claim?
A.  If an employer discriminates or retaliates against an employee in any manner (for example, discharges the employee) because the employee filed a wage claim or threats to file a wage claim with the Labor Commissioner, the employee can file a  discrimination-retaliation complaint with the Labor Commissioner's Office, file a lawsuit in court against your employer.

If you have any further questions about minimum wage or compensation, or you need legal representation once a claim has been filed, contact me at (916) 333-4653 or Stephen_Fiegel_ESQ@comcast.net for a FREE confidential consultation to learn more.

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