2017 Legislative Update: Wage and Hour
February 2, 2017 by Peter McEntee
This legislative session, Governor Brown again signed into law several new labor and employment statutes. Many of the new laws this year expand enforcement tools and strengthen existing protections for employees in areas including leave and disability rights, pay equity, wage-and-hour protections, and prevailing wage and public works. In this series we have summarized the new state laws by category. The first installment covers wage-and-hour.
Wage and Hour
SB 3 – Minimum Wage Increase
The statewide minimum wage will be gradually increased to $15 per hour by 2022. The minimum wage was increased from $10.00 to $10.50 per hour on January 1, 2017. Thereafter, the minimum wage will increase to $11.00 in 2018; $12.00 in 2019; $13.00 in 2020; $14.00 in 2021; and $15.00 in 2022. Starting in 2023, the minimum wage will be increased each year based on the Consumer Price Index, but never by more than 3.5% in one year. This important legislation will help approximately six million employees who currently make minimum wage or only slightly above the current minimum wage.
AB 1066–Farmworker Overtime
This new law corrects years of injustice and unequal treatment towards farmworkers. Farmworkers have long received overtime pay only after 10 hours in a day or 60 hours in a week. This differs from the vast majority of other hourly employees in the state who are entitled to time and a half after 8 hours in a day or 40 hours in a week. AB 1066 will eliminate this inequity by ultimately requiring overtime for farmworkers after 8 hours in a day or 40 hours in a week. The increased overtime rights will be phased in over the next six years. During this phase-in, farmworkers will be entitled to overtime after 9½ hours per day or 55 hours per week beginning January, 2019; after 9 hours per day or 50 hours per week beginning January 1, 2020; after 8 ½ hours per day or 45 hours per week January 1, 2021; and then full implementation as of January 1, 2022.
AB 2230–Overtime for Private School Teachers
Current law provides that private school employees are exempt from overtime requirements as long as they are paid a monthly salary that is equal to at least double the statewide minimum wage. This has created some calculation problems because the minimum wage often changes on January 1 of each year, not consistent with the school year. AB 2230 changes the formula for considering the overtime exemption. Starting July 2017, private school employees will be exempt from overtime pay if they earn the greater of: 1) at least 100% of the lowest salary offered by any school district to an employee that is required to have a teaching credential, or 2) the equivalent of no less than 70% of the lowest salary schedule offered by the school district or county in which the private school is located.
SB 1015 – Overtime for Domestic Workers
In 2013, the state enacted the Domestic Worker Bill of Rights which granted overtime to domestic workers after 9 hours in a day or 45 hours in a week. That bill, however, had a sunset that ended these overtime rights as of January 1, 2017. SB 1015 eliminates the sunset date, thereby making domestic workers’ overtime rights permanent.
AB 1847 – Notification Regarding Earned Income Tax Credit
Existing law establishes federal and state Earned Income Tax Credit that some employees are eligible for based on income. Currently, California’s employers are required to provide formal notification to employees that they may be eligible for the federal Earned Income Tax Credit. This bill expands that to require requires employers to provide similar notification regarding the state Earned Income Tax Credit.
AB 2535- Itemized Wage statements
Current law requires an employer to provide an accurate itemized wage statement containing information to illustrate how wages were calculated. This information includes the total hours worked and the rate of pay. With this bill, employers will not be required to include hours worked on wage statements for salaried and exempt employees.
AB2899- Minimum wage Violations
Under current law, when an employee brings a wage claim, if the employer loses and appeals to the Superior Court, the employer must file a bond for the full amount of the wages and damages owed. However, such a bond is not required when an employer appeals decisions where the Labor Commissioner, on its own, has issued violations and ordered the employer to pay wages. The bond is important to ensure that the employee will be able to receive the amounts owed if the employer’s appeal is unsuccessful. This bill corrects the problem by requiring a bond for wages owed and damages as a prerequisite for an employer to appeal a Labor Commissioner action.
The material on this website is provided by Beeson, Tayer & Bodine for informational purposes only and does not constitute legal advice. Readers should consult with their own legal counsel before acting on any of the information presented. Some of the articles are updated periodically, and are marked with the date of the last update. Again, readers should consult with their own legal counsel for the most current information and to obtain professional advice before acting on any of the information presented.