California’s minimum wage will rise again Jan. 1, 2024 – to $16 per hour for employers of every size as a result of inflation. But local ordinances in more than 30 California counties set the minimum wage, sometimes called a living wage, even higher, and these increases typically take effect in January or July. Employers in 26 cities and counties will begin paying a higher local minimum wage in 2024.
Employers always must pay the local minimum wage in the employer’s place of business if it is higher than California’s minimum wage. And employers with exempt employees should evaluate their workers’ salaries because exempt employees in California generally must earn a minimum monthly salary of no less than two times the state minimum wage for full-time employment.
Dental offices generally are not included in the health care worker minimum wage that will take effect in June 2024.
January 2024 wage increase tied to inflation
The state minimum wage has increased every year for employers of all sizes since 2017 in accordance with legislation signed into law by former Gov. Jerry Brown. That law capped the minimum wage at $15. Employers with 26 or more employees reached the cap in January 2022; employers with fewer than 26 employees reached the $15 cap this year.
However, a provision in the law allows wages of at least $15 to be raised annually up to 3.5% (rounded to the nearest 10 cents) for any increase in inflation of over 7% as measured by the national Consumer Price Index. This adjustment happened in 2023, increasing the minimum wage to $15.50, and is happening again now. All California employers of every size will begin paying a minimum wage of $16 beginning Jan. 1, 2024, a Department of Industrial Relations news release states.
Some local minimum wages will increase Jan. 1 or in July
Dentists should familiarize themselves with their local government wage order and ordinances. In some areas of California, the minimum wage is rising more quickly than the state minimum wage. Employers in more than 30 cities are already required to pay an hourly minimum wage ranging from $15.97 to over $19.
Member dentists are encouraged to log in to review CDA’s resource Minimum Wage and Paid Sick Leave Ordinances by City/County. CDA has updated the resource in recent weeks to note the following cities and one county that have confirmed on their websites minimum wage increases that take effect Jan. 1, 2024:
Cities of Belmont, Burlingame, Cupertino, El Cerrito, Half Moon Bay, Hayward, Los Altos, Mountain View, Novato, Palo Alto, Petaluma, Redwood City, San Carlos, San Diego, San Jose, San Mateo, Santa Clara, Santa Rosa, and Sunnyvale; and Los Angeles County.
The increase also affects the minimum salary requirements for full-time exempt employees. Beginning Jan. 1, 2024, these employees should receive a salary of at least $66,560 per year or $5,546.67 per month.
Daly City, Foster City, Menlo Park, Oakland, Sonoma and South San Francisco are expected to raise their local minimum wage in 2024. CDA is monitoring these websites and will update its resource with the additional increases and links to the respective local ordinances.
CDA’s resource includes not only links to local wage ordinances but also to ordinances pertaining to parental leave, lactation and freelance worker protection, for example.
Dental offices generally not included in health care worker minimum wage
Legislation signed into law this fall, SB 525, will eventually raise wages for health care workers in many settings to $25 per hour.
The law generally does not apply to dental offices but does include employees of community clinics (federally qualified health centers or FQHCs) and any hospital-based dentistry under certain circumstances as defined in the bill.
The final version of the bill was negotiated by representatives of the affected health care employers and includes longer phase-in periods for some settings as well as waivers for facilities in financial distress. The first increase for eligible workers and facilities will occur June 1, 2024.
An article by the Society for Human Resource Management, commonly known as SHRM, explains the health care worker minimum wage.
Employers must follow the stricter wage standard
Again, employers must follow the stricter wage standard when paying employees — specifically, the standard that is the most beneficial to the employee.
Some employees, including outside salespersons or the employer’s spouse, child or parent, are exempt from the state minimum wage law. The governor can suspend a scheduled wage increase in the event of an economic slowdown (defined as negative job growth combined with negative retail sales for a specified time period) or if a budget deficit is forecasted for the current budget year up to two additional years.
The California Minimum Wage notice for 2024 will be available later this year in the workplace postings section of the DIR’s website. CDA members may want to bookmark CDA’s list of city and county ordinances related to minimum wage and paid sick leave as more updates are expected by end of the year.