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California’s New Minimum Wage Increase Law – The Nation’s Highest

minimum wageAfter California Governor Jerry Brown approved a bill that increases the minimum wage by $2 over the next three years, the Golden State’s minimum wage is now the country’s highest so far.

According to news reports, Brown approved the bill in front of the state legislators, business owners and workers during the signing ceremony in Los Angeles last Wednesday morning.

“For millions of California’s hardworking minimum wage employees, a few extra dollars a week can make a huge difference to help them provide for their families. They deserve a modest boost and after six years, an increase in California’s minimum wage is the right thing to do,” said the state Senate President pro tem, Darrell Steinberg, in a press release.

Under the new law, the minimum wage will go up in two separate $1 increments. The first will increase the rate from $8 to $9 in July next year, while the second that will increase the $9 rate to $10 will be in January, 2016.

Based on the Economic Policy Institute, nearly 3 million California workers are currently earning under minimum wage.

Subsequently, while many low wage earners across the state lauded the new law, some believe that the increase in minimum wage would only mean an increase in taxes and a price hike. Also, others are also feared that the minimum wage increase would cut back on hiring workers, making job hunt more difficult for them.

Brown on the other hand backs his approval by saying that wages in California have long been stagnated while consumer prices continue to rise.

However, according to the Bureau of Labor Statistics, a $10 per hour in 2016 would only be equivalent to approximately $9.36 in today’s currency. Thus, by the time the $10 minimum wage takes effect, it would no longer be noticeable since it will only be outpaced by the inflation.

Meanwhile, several Los Angeles employment lawyers shared the same belief as the Bureau of Labor Statistics does. They are quite concerned that by the time the much awaited minimum wage increase takes effect, workers will no longer feel the relief it brings since the increase was already surpassed by the higher inflation rate.

 

Posted in Labor Laws.

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