Our team just wanted to send a reminder about the changes to minimum wage and paid sick leave ordinance for Los Angeles that go into effect on July 1, 2017. These apply to any company in the ‘City of Los Angeles’, or any ‘unincorporated’ community in Los Angeles County. Local city ordinances may also be in effect on July 1st, such as Pasadena and Santa Monica.
Paid Sick Leave
For the Paid Sick Leave Ordinance, effective July 1, 2017, employers with 25 or fewer employees must grant at least 48 hours of paid sick time to each employee. This is an increase from the 24 hours per year required by the California paid sick leave law. Any company with 25 or fewer employees that already has a frontloaded paid sick leave policy in place that provides at least 24 hours between July 1, 2017 and December 31, 2017 does not need to make any adjustment until January 1, 2018. Also, any company that has a paid leave, vacation, or paid time off (PTO) policy that provides compensated time off that is equal to or no less than 48 hours per year, there is no need to adopt an additional sick time policy. For employers with 26 or more employees, there are no changes as the changes above went into effect July 1, 2016 for these companies.
Minimum Wage
The minimum wage in Los Angeles will rise according to the following schedule:
Employers with 26 or more employees generally must pay a wage of at least the following hourly rates:
$10.50, beginning July 1, 2016;
$12.00, beginning July 1, 2017;
$13.25, beginning July 1, 2018;
$14.25, beginning July 1, 2019; and
$15.00, beginning July 1, 2020.
Employers with 25 or fewer employees generally must pay a wage of at least the following hourly rates:
$10.50, beginning July 1, 2017;
$12.00, beginning July 1, 2018;
$13.25, beginning July 1, 2019;
$14.25, beginning July 1, 2020; and
$15.00, beginning July 1, 2021.
Beginning on July 1, 2022, the minimum wage will increase annually based on inflation. The City of Los Angeles is expected to announce the adjusted rates on January 1, and publish a bulletin announcing the adjusted rates that will take effect on July 1 of each year.
For exempt employees, the minimum pay in CA remains at $800/week for employers with 25 or fewer employees and $840/week for employers with 26 or more employees. In regards to the appeal of the injunction placed on the Department of Labor’s Overtime Rule that would increase the minimum pay for exempt employees, a delay on the appeal hearing has been extended to June 30, 2017. As soon as there is any update on the appeal, our team will send out additional information right away.