A Guide to Minimum Wage Laws in California for Employees

Minimum wage refers to the minimum hourly rate of pay that employees must be paid for their work.

More often than not, employees must be paid the highest minimum wage that has been established for the jurisdiction in which they work.

Our California employment lawyers volition explain. Please don't hesitate to phone call our firm at (800) 668-7984 or transport us an online message for assistance.

California minimum wage law

What is the California Minimum Wage?

At the federal level, the minimum wage is governed by the Fair Labor Standards Act.

Federal law currently sets the minimum wage at $7.25 per hour.

Withal, federal law allows states and cities to prepare a minimum wage that is higher than the federal rate.  29 U.S.C. § 218(a).

California has established a higher minimum wage than the federal rate, so employers in California are required to pay the minimum wage that has been established past state law (unless an evenhigher rate has been established by the city or county in which they operate –run across beneath).  Labor Code § 1182.12.

The California minimum wage is scheduled to increase gradually over time.

California minimum wage rates and their scheduled increases are shown in the following table:

Hourly Minimum Wage Rates in California
Effective Year
(Jan 1 to December 31)		 Employers with more 25 or
fewer employees 		Employers with more
than 25 employees
2018 $10.50 $xi.00
2019 $11.00 $12.00
2020 $12.00 $13.00
2021 $13.00 $14.00
2022 $14.l $15.00
2023 $15.fifty $15.00

For January ane, 2024, and thereafter, the California minimum wage is automatically adapted using a methodology tied to the consumer price alphabetize.

Themethodology for further increases substantially applies an increase over the prior minimum wage that is equal tothe lesser of:

  • v%; OR
  • "[T]he rate of change in the averages of the nearly recent July 1 to June xxx, inclusive, the menstruation over the preceding July ane to June xxx, inclusive, period of the … nonseasonally adjusted the U.s.a. Consumer Cost Alphabetize for Urban Wage Earners and Clerical Workers (U.S. CPI-W)."

The result is rounded to the nearest 10 cents.

If the CPI-calculated charge per unit is negative, then in that location is no increase or decrease in the minimum wage for the post-obit year. Labor Code § 1182.12(c).

If the Governor determines that economic conditions practise not support the California minimum wage increment, a scheduled increase may be temporarily suspended.

When the Governor suspends the increase, it is but postponed until the post-obit yr. Labor Code § 1182.12(d).

Local California Minimum Wage Rates

Some cities and counties within California have established higher minimum wages than the country's level.

Jurisdiction Minimum Wage
per hr as of July 2018 		Notes
San Francisco $15.00 Adjusted annually based on CPI
Oakland $thirteen.23 Increases tied to CPI-W for San Francisco-Oakland-San Jose
Berkeley $13.75 Increases to $fifteen.00 October 1, 2018, and tied to CPI thereafter
Los Angeles $13.25* *For employers with more than 25 employees ($12.00 for employers with 25 or fewer employees)
San Diego $11.50 Increases tied to CPI
San Jose $thirteen.50 Increases to $15.00 on January one, 2019

The University of California at Berkeley has compiled and maintains local metropolis and canton level minimum wage rates here.

Who Must be Paid California Minimum Wage?

The minimum wage must exist paid by employers to employees in "all industries."

Employer means "any person who direct or indirectly, or through an agent or any other person, employs or exercises command over the wages, hours, or working weather of any person."  Labor Lawmaking § 1182.12.

Employees who work in the country must exist paid California'south minimum wage even if they don'talive in California.See Sullivan v. Oracle Corp.

Employees cannot waive their correct to receive the California minimum wage.

This means that even if an employee agrees to work for less than minimum wage or agrees to any arrangement that would result in them receiving a lesser rate of pay, that agreement is considered unlawful and will not be enforced.

See Civil Code §§ 1668 and 3513.

This is the instance even if the agreement is a collective bargaining understanding.

Contact The states Schedule your consultation.

When Doesn't California Minimum Wage Utilize?

There are some situations in California where the minimum wage does not apply or where employees may be paid less than minimum wage.

Source: 8 CCR §§ 11010-11170

Executives, Administrative Staff, and Professionals

California's minimum wage laws practise not apply to staff classified as executive, administrative or professional person.Nevertheless, the exemption of these types of positions from minimum wage police is basically moot.

This is because to meet the legal definition of executive, authoritative or professional person, an employee must be paid a salary that would put their equivalent hourly "wages" well above the minimum wage.

For these employees, their monthly salary must be at least twice  the land minimum wage, assuming they are working 40 hours per week.

So, if the applicable minimum wage is $11.00 per hr, the monthly salary required to qualify as an executive, administrative staff or professional would exist$3,813 (two times $11 per 60 minutes times 40 hours per week times 52 weeks per year, divided by twelve months per year).

Learners

An employee in a job in which they do not have similar or related experience may be paid at a rate that is 85% of the minimum wage, rounded to the nearest nickel.  This but applies during their first 160 hours of employment. Subsequently 160 hours of employment, their wages must be increased to 100% of the minimum wage.

At Camp

Camp counselors and educatee employees of an "organized camp" may be paid at 85% of the hourly California minimum wage rate. Labor Code § 1182.4, subdivision (a).  An "organized campsite" means an outdoor site with programs established to provide an outdoor group living experience "with social, spiritual, educational, or recreational objectives" for at least five days during a season. Health and Safety Code § 18897(a).  Trailer parks, resorts, motels, hunting camps, and penal or correctional camps practise non count as "organized camps."  Health and Rubber Lawmaking § 18897(b).

Disabled

The Division of Labor Standards and Enforcement of the Country of California may outcome licenses to qualify employment of persons whose "earning chapters is impaired past physical inability or mental deficiency at less than the minimum wage." The employers and the employee, or the employee's representative, mustjointly employ for this license. The minimum wage charge per unit that must exist paid in these circumstances is set up past the Labor Committee. Labor Code § 1191.

Sheltered Workshops and Rehabilitation Facilities

The Division of Labor Standards and Enforcement may issue licenses to nonprofit organizations, such as a sheltered workshop or rehabilitation facility, fixing a special minimum wage charge per unit to enable employment of certain persons without requiring an individual license for the employee.  8 CCR §§ 11010-11170, subdivision 1(D).

Immediate Family unit

Parents, spouses, children and legally adopted children of an employer are not subject to California minimum wage laws.  8 CCR §§ 11010-11170, subdivision one(D).

Outside Salespersons

Exterior salespersons are exempt from minimum wage laws,provided sure requirements are met. An exterior salesperson is someone xviii years of age or older who "customarily and regularly works more one-half the working fourth dimension away from the employer'south place of business selling tangible or intangible items or obtaining orders or contracts for products, services or use of facilities."

The "employer'south place of business" can be whatsoever fixed location, whether it is endemic by the employer or not.

Information technology could mean the salesperson's own home if that is where the employee otherwise conducts the employer'due south business.

For this exemption to use, non only must more than one-half the employee'stime be spent away from the place of business organization, but the employee's activities that have place away from the place of business must also consist ofsales.

It should be noted hither likewise that exemptions from California labor laws are generally "narrowly construed" because at that place is "potent public policy favoring the protection of workers' full general welfare and society'south involvement in a stable labor market." Taylor v. UPS, 190 Cal.App.4thursday 1001 (2010).  This means courts will be quite strict in applying the requirements for an exemption to be met.

Do Independent Contractors Go Paid Minimum Wage?

Contained contractors are not required to be paid minimum wage.  This is considering, by definition, independent contractors are non considered employees.

That said, there are many factors that become into determining whether or non a worker islegitimately classified equally an employee or an independent contractor.

It is important to note that the characterization attached by the parties to the relationship isnot the deciding gene. Estrada v. FedEx, 154 Cal.App.fourth 1 (2007).

Rather the essence of the question of whether someone is working as an independent contractor or an employee is the caste of control exercised over the worker in the "actual conduct" of the person or entity hiring the worker. Estrada.

Even if the employer and the worker enter into an understanding thatexplicitly states that the worker is an contained contractor, a court will still look to the corporeality of direction and command that the contracting entity exercises over the worker'southward piece of work.

Some Special Cases

Not all employees are paid by the 60 minutes.  Some employees are compensated on a commission basis and some employees are paid by the task, the job or the number of pieces they produce.

How California minimum wage law apply in those cases?

The bottom line for these types of situations is that the employer is required to recoup such employees "not less than" the California minimum wage for all hours worked in the payroll period.  eight CCR §§ 11010-11170.

Piece Rates

Many workers, especially in the garment industry, are paid past the piece.  Hither's how this might work.

Suppose an employer pays $.25 per piece and a worker finishes xl pieces in an hr, so the full earned at the piece rate would be $x.  The employer, however,must even so payat least the minimum wage.

So, if this piece of work is happening in San Diego where the minimum wage is currently $11.50 per hour, the employee must nonetheless be paid $xi.fifty for that hour of work.

Now suppose the same worker, over the form of a 40-hour week, completes two,008 pieces, resulting in a full piece rate for the week of $502.  If we are still in San Diego, a 40-hr workweek at minimum wage would result in weekly payments of $460.

In this case, then, fifty-fifty though the worker may have earned less than $eleven.l per hour duringsome of his or her 40 hours of work, overall the amount earned wouldseem to come across minimum wage requirements.

In California, however, information technologymight not.

This is chosen "pay averaging."  The legality of pay averaging varies depending on the jurisdiction.  Some federal courts have found pay averaging to exist an adequate practise under the Off-white Labor Standards Act.Encounter, e.m., Medrano 5. D'Arrigo Brothers Co. 336 F.Supp.2d 1053 (North.D.Cal. 2004).

Under California law, however, pay averaging for slice work isnot permitted. Gonzalez v. Downtown LA Motors, 215 Cal.App.4th 36 (2013).

In California, rather, the employer must compensate the employee the minimum wage foreach hour the employee must be at work,fifty-fifty if the slice-rate piece of work forsome of those hours results in pay that is higher than minimum wage for those hours.

Furthermore, employers must pay workers for any time the worker is required either to await effectually or to perform tasks other than the piecework tasks for which they are receiving slice-charge per unit pay. Gonzalez.

Commission Sales

As with piece-charge per unit piece of work, employees who are paid on a commission footing must be paidat to the lowest degree the minimum wage for all hours worked. For commission sales, however, the relevant time frame over which  California minimum wage must exist paid isthe entire pay period, rather than each hr.

Employees paid on commission must generally be paid at least twice per calendar month.  Labor Lawmaking § 204(a). (Commissioned automobile salespersons, however, may be paid merely once per month. Labor Code §204.one.)

The timing of when commissions are earned and paid is usually covered by an employment agreement, but in that location are times when the commissions paid for a pay period will non meet minimum wage requirements. In those situations, the employer must make up the difference between how much has been paid for earned commissions and what the California minimum wage law would otherwise require as minimum pay during the period.

As with the pay averaging result described above for slice-rate piece of work done per hour, commissions paid in1 pay period cannot be carried over and counted as meeting the California minimum wage requirementsin afterwards pay periods. Peabody five. Time Warner Cable, 59 Cal.4th 662, 669 (2014).

If you accept questions well-nigh anything or believe you have a claim confronting your employer for California wage violations, send u.s. a message or call (800) 668-7984 for aid.

Split Shifts

A "separate shift" refers to a work schedule in which the work period is interrupted by not-paid, non-work periods (other than bona fide rest and meal breaks) established by the employer.

When a minimum wage employee is required to work a divide shift, the employer must pay a "split shift premium" in the form of one actress 60 minutes of pay.  Thus, if an employee works a full of eight hours in a carve up shift at minimum wage, the employee must be paid for a full of 9 hours. 8 CCR §§ 11010-11170 subdivision four(C).

If an employee earnsmorethan the minimum wage for a divide shift, the employee is still entitled to the split up shift premiumwhenever the number of hours worked plus ane hour paid at minimum wagewould exceed the pay earned by the actual hours they worked at their regular rate of pay.

Deductions From the California Minimum Wage

Payment of minimum wages refers to employees'gross pay, which means the corporeality the employee receivesbefore taxes and other legitimate deductions are withheld.

Wherever these kinds of deductions are authorized by law, they are non treated as reducing the employee's California minimum wage.

Meals and Lodging

Meals and lodging may only be credited against California minimum wage with the employee's written agreement. viii CCR §11000.

There are limits to the value of meals and lodging that may be credited toward minimum wage obligations, depending on whether the meal is breakfast, lunch, or dinner, and depending on whether the lodging is a room occupied alone, a room shared, or an apartment.

Meals must be "adequate," advisable for the employee'due south work shift and consist of a "well-balanced serving of a variety of wholesome, nutritious foods."  8 CCR §§ 11010-11170, subdivision x.

Furthermore, the lodging must be available for full-fourth dimension occupancy and be accounted "adequate, decent and germ-free according to the usual and customary standards." Employees may non be required to share a bed.

If meals are not actually taken or lodging is non actually used, the employer may non take any credit for them against the minimum wage otherwise due.  8 CCR §§ 11010-11170, subdivision 10.

The maximum credits that may be claimed past employers who furnish lodging or meals, equally of January i, 2018, are equally follows:

Employers with 25 or fewer employees Employers with 26 or more employees
Lodging
Shared Room $xl.76 / week $42.70 / week
Individual Room $49.38 / week $51.73 / week
Apartment occupied by 1 person – two thirds (ii/3) of the ordinary rental value, simply no more $593.05 / month $691.29 / month
Apartment occupied by a couple where both are employed by the employer – ii thirds (2/3) of the ordinary rental value but no more than $877.26 / month $919.04 / month
Meals
Breakfast $3.lxxx $3.98
Tiffin $5.22 $5.47
Dinner $7.01 $7.35

Tips

Under California police force, different the federal Off-white Labor Standards Human action, an employercannot count an employee'southward tips toward meeting the minimum wage.  U.Southward. Dept. of Labor.

Tipped employees are entitled to receive the full minimum wageearlier tips in California. Labor Code § 351.

Tips are considered the property of the employee who earned them and cannot, therefore, be treated as wages. Labor Code § 351.

"Tip pooling," where employees are required to pool and so share tips, is allowed,provided that neither the employer nor the employer's agent receives any share of the puddle. Jameson v. Five Feet Eatery, 107 Cal.App.fourth 138, 141 (2003).

An employer'southward agent is "every person other than the employer having the authority to hire or discharge any employee or supervise, direct, or control the acts of employees." Labor Code § 350(d).

How is the California Minimum Wage Enforced?

Filing a Complaint or Lawsuit

If an employer refuses or fails to pay the California minimum wage in compliance with the constabulary, employees may either file a wage claim with a federal or land agency, or they may file a ceremonious lawsuit. Labor Code § 1194.

Under California constabulary, employees are entitled to recover the full corporeality of the unpaid residuum owed, including involvement, likewise every bit reasonable attorney's fees and costs. Labor Code § 1194.iii.

Time Limits for Acting

In that location are time limitations for how long a California minimum wage violation claim may exist filed afterward it has occurred. For California minimum wage claims, the time limit is usually iii years.

If the violation is based on a written agreement, the time limit is iv years.

No Retaliation Allowed

Employers may non discriminate, retaliate or take any agin deportment against employees who exercise their rights under the California Labor Code. § 98.six, subdivision (a).

This is truthful whether the employee only brings an issue to the attention of the employer or whether the employee files a complaint or lawsuit.

Contact a California Employment Lawyer for Assistance

If you have any questions well-nigh California's minimum wage laws or believe your employee rights take been violated, delight accomplish out to our firm by calling (800) 668-7984 or by contacting united states online.