What you might not know about the new minimum wage law…
A year after vetoing a similar bill, Governor Schwarzenegger signed into law AB 1835, which raises the minimum wage from $6.75 per hour to $7.50 per hour effective on January 1, 2007, and then to $8.00 on January 1, 2008. This law directly raises the wages paid to 1.4 million California workers that earn minimum wage. What you might not know, is that salaried employees who are “exempt” under the administrative, professional, or executive categories, in addition to meeting the appropriate duties test for each classification, must also be paid at least double minimum wage. This means that exempt employees must have an annual salary of at least $31,200 effective January 1, 2007, and $33,289 beginning January 1, 2008. Also being affected are the thousands of employers who, in an attempt to stay competitive, invested in paying slightly higher than minimum wage in an effort to attract and retain a more stable unskilled labor force. These employers are suddenly finding themselves forced to raise the bar yet again in order to secure their workforce in the fierce battle for talented, motivated employees. “There’s going to be upward pressure in a lot of these wages that may not be the minimum wage now,” says Marc Freedman, director of labor law policy at the U.S. Chamber of Commerce. “There are a lot more employers who may be caught up in this than realize it at the moment.”
No Increase in the Federal Minimum Wage Law, Yet.
Democrats failed again this year to increase the federal minimum wage, which has held steady at $5.15 per hour over the past decade. Senator Edward Kennedy’s (D-Mass.) proposal to increase the federal minimum wage by $2.10 fell just eight votes shy in June 2006. Thus, this is likely to continue to be a hotly contested issue in the new year.
Will San Francisco’s New Sick Leave Policy Set a Trend for all of California?
San Francisco has adopted a mandatory sick leave policy affecting all employees, including part-time, temporary employees, and employees participating in Welfareto-Work Programs working in San Francisco or San Francisco County. The ordinance entitles every employee to one hour of paid sick leave, to be accrued in hourly increments for every 30 hours worked, with a cap of 40 hours for employers with fewer than 10 employees and a cap of 72 hours for all other employers. Employers must allow employees to carry over accrued sick leave (as limited by these caps) but are not required to pay out unused sick leave upon termination of employment. This new ordinance becomes effective on February 5, 2007. Employees working on February 5, 2007, will begin to accrue paid sick leave as of that date, while those hired after that date will begin to accrue paid sick leave 90 days after their hire date.
Immigration Laws Continue to Tighten Down.
Employers should be aware that the U.S. Bureau of Immigration and Customs Enforcement (“ICE”) has proposed rules which give employers 14 days after receiving a letter from the Social Security Administration saying a worker’s Social Security number doesn’t match its records, to resolve the discrepancy or take other steps to settle the matter. Employers would have up to 63 days to terminate an employee under the proposal if the discrepancy ultimately isn’t resolved. Otherwise, ICE may, in a review, find an employer had knowledge that they hired an illegal worker. Acceptance of these rules could have a far-reaching impact on many employers. Many companies are using the Basic Pilot program operated by the Department of Homeland Security to assist them in verifying whether workers are legally eligible to work. Companies may register to take part in this program at: http://www.visdhs.com/EmployerRegistration. Another helpful resource can be found at: http://hr.web.cmu.edu.
Workplace Fact
Passion for the job is the top characteristic employers look for in a candidate. Employees who are passionate about their jobs tend to be more productive workers.