Even though
wage just went up on Jan. 1 and another increase is scheduled for next year,
state lawmakers are considering future adjustments. And, it looks like the
federal minimum wage will also see a hike in the near future. Here’s an update
on recent legislative action regarding the minimum wage in
Future Automatic
Increases Proposed
When Gov. Schwarzenegger
and
agreement last year to raise
minimum wage, one compromise some lawmakers had to accept was not to include a
provision for future automatic rate hikes. But now, a recently introduced
measure would do just that.
The new bill, A.B. 71,
provides that beginning in 2009, the minimum wage will be automatically adjusted
each Jan. 1. The adjustment would be determined by multiplying the minimum wage
rate in effect on the prior June 30 by the inflation percentage (as specified
in the California Consumer Price Index) for the previous year. That figure
would be rounded to the nearest 5 cents to determine the new rate. The measure
would not preclude the state Industrial Welfare Commission from setting a
minimum wage that is higher than the rate resulting from the annual inflation
adjustment. You can link to the measure at www.leginfo.ca.gov/bilinfo.html.
Note that the
rate as of Jan. 1, 2007 is $7.50 per hour. On Jan. 1, 2008, the rate will rise to
$8.00 per hour.
The HR Management & Compliance Report: How To Comply with California Wage & Hour Law, explains everything you need to know to stay in compliance with the state’s complex and ever-changing rules, laws, and regulations in this area. Coverage on bonuses, meal and rest breaks, overtime, alternative workweeks, final paychecks, and more.
Congress Moving on
Federal Minimum Wage Hike
As we reported last
month, Congress is looking at a federal minimum wage increase. The Senate has passed
a minimum wage bill, by a vote of 94 to 3, that would raise the federal minimum
wage from the current $5.15 per hour to $7.25 per hour over a period of 26
months and provide tax breaks to small businesses. The original House bill did
not include tax breaks for small businesses, but on Feb. 16 the House
separately approved business tax breaks.
Now, legislators must
hash out the differences between the House and Senate tax break and minimum wage
measures.
We’ll keep you posted on
the status of the state and federal minimum wage legislation.