In his recent State of the Union address, President Obama urged legislators to take charge in pushing minimum wage increases through Congress. California State Senator Mark Leno (D-San Francisco) took the request to heart, as he introduced a state bill on February 3, 2014 that would make California’s minimum wage the highest of any state if passed.
Currently, a law is in place that will raise the state minimum wage from $8.00 per hour to $9.00 per hour in July 2014, then again to $10 per hour in 2016. There is no provision in the current law for further annual increases based on inflation after 2016. Sen. Leno’s proposed bill would step up the wage increase as follows:
$11.00 per hour in 2015;
$12.00 per hour in 2016;
$13.00 per hour in 2017;
Annual adjustments tied to inflation starting in 2018.
While the bill is expected to garner some opposition, Leno defends the aggressive increases by citing the high cost of living in California. He stated that the federal minimum wage is simply a starting point, and state legislators should identify the needs of residents of their state and adjust the state minimum wage accordingly.
Current California Minimum Wage
Residents working 40-hour weeks at the existing state minimum wage of $8.00 per hour take home $16,640 annually, before taxes. The poverty line in California for a four-person family with one wage earner is $23,850. According to the United States census, this wage discrepancy puts approximately 24 percent of California residents under the poverty level despite working full-time jobs.
State Senator Leno owns his own company and pays his workers a minimum of $16 per hour. Leno states that paying higher wages reduces turnaround and increases employee productivity. He stated there is no excuse for companies making high corporate profits while some of their full-time employees need food stamps and other government assistance to survive.
Earlier this year, 600 prominent economists from the Economic Policy Institute signed a letter to federal lawmakers urging them to pass a federal minimum wage of $10.10 per hour. These economists assert that raising the minimum wage will bring many families out of poverty, thereby reducing the need for government public assistance and increasing spending by consumers. Recently, some conservative politicians and entrepreneurs in California have jumped on board, demonstrating support for a minimum wage increase and reduction in poverty.
Though the $13 per hour proposal would be the highest state minimum wage in the United States, it will still not be the highest local minimum wage. Last year, the city of SeaTac, Washington raised its minimum wage to $15.00 per hour. Furthermore, Los Angeles legislators have a bill on the table to raise wages for hotel workers to $15.37 per hour, which would be the highest in the country. San Francisco has the highest minimum wage in California, currently at $10.55 per hour.
Everyone deserves to be adequately paid for their work. If you believe your employer is violating wage and hour laws, call the Pershing Square Law Firm today for help.