DEMOCRATS JAM MINIMUM WAGE INCREASE BILL THROUGH LEGISLATURE
FIRST $0.50 INCREASE TAKES AFFECT ON JANUARY 1, 2017, CONTINUES TO2022
The Legislature passed a proposal to incrementally increase the minimum wage up to $15 per hour by January 1, 2022. The bill passed on Thursday March 31st and Governor Brown was expected to sign the measure.
SB 3, increases the minimum wage by $0.50 beginning January 1, 2017. The current California minimum wage is $10.00 per hour. The hourly wage then increases by one dollar every year until it reaches $15 by January 1, 2022. Every year after 2022, SB 3 indexes future increases to the US Consumer Price Index up to 3.5% per year.
The Times reported earlier this week that passage of the bill would result in a $22 billion wage increase for workers. Unfortunately, the Times failed to see the increase inversely for California businesses — SB 3 will be a $22 billion labor increase for employers. The bill gives employers with 25 or less employees one additional year to comply with the increase in minimum wage.
The legislature has increased the minimum wage before, but in years past it was coupled with some type of tax savings or other type of savings for employers. These savings defrayed the cost of labor increases. There were no such savings in SB3.