Big changes for CA healthcare workers! New minimum wage rates are in effect, with increases rolling out as of October 16, 2024. Weintraub attorneys Nikki Mahmoudi and Jacqueline Simonovich make sure you’re up to date with the change on the latest episode of California Employment News.

Watch this episode on the Weintraub YouTube channel.

Nikki Mahmoudi:

Hi, everyone. Thank you for joining us for this installment of California Employment News, an informative video and podcast resource offered by the labor and employment group here at Weintraub Tobin. My name is Nikki and I’m an associate in the firm’s labor and employment group. And today I’m joined by my fellow associate, Jackie Simonovich. So, a few weeks ago on October 29th, we had our CEN talking about minimum wage increases for 2025. Today we’re going to talk about the healthcare minimum wage that went into effect on October 16, 2024. Jackie, could you please start us off?

Jacqueline Simonovich:

Yeah, thanks, Nikki. So recently, legislation was enacted that increased the minimum wage for workers of certain healthcare employers. And this increase went into effect on October 16, 2024. So to receive this increase, workers must meet two criteria. First, they have to work for certain healthcare facilities as those are defined in the new law, and they have to provide healthcare services or provide services supporting the provision of healthcare. Now, healthcare facilities are defined in the law to include hospitals and hospital systems, care and residential settings, physicians groups, county mental health facilities, county correctional facilities or jails, mental health rehabilitation centers, outpatient clinics and clinics providing primary care. And the law provides specific definitions for each of those facilities as well. One important thing to note is that any healthcare worker providing services for a healthcare facility owned, controlled or operated by the state of California is not entitled to the minimum wage increase. However, healthcare workers providing services for a political subdivision of California, so that’s a county, a municipality, municipality, a healthcare district, or the University of California system are covered by the law, so they can get the minimum wage increase. So the second criteria for workers to qualify for the minimum wage increase is that they have to provide healthcare services or services supporting the provision of healthcare.

What does this mean? Well, these are patient care related services, and they include services you might immediately associate with patient care, like nursing, caregiving services provided by medical residents, and other technical services, and then also services you might not immediately associate with patient care, like janitorial work, housekeeping, groundskeeping, guard duties, office work, food services, laundry, medical coding and billing, call center work, warehouse work, scheduling, and even working in a hospital gift shop. So, Nikki, what exactly is the minimum wage increase?

Nikki Mahmoudi:

Yeah, let’s get into that. So the amount of the minimum wage increase varies across the different facilities and will increase in phases with the first phase starting on October 16, 2024. Some examples of this wage schedule are, for instance, with hospital or integrated health systems with 10,000 or more full time employees, and that includes skilled nursing facilities operated by those employers. The Minimum wage schedule would be as follows. So from October 16, 2024 to June 30, 2025, it would be $23 an hour. Then from July 1, 2025 to June 30th, 2026, it would be $24 an hour. From July 1, 2026 to December 31, 2027, it would be $25 an hour. And then starting January 1, 2028, it would be adjusted for inflation each year. Similarly, with intermittent clinics, community clinics, rural health clinics, or urgent care clinics associated with community or rural health clinics, the minimum wage schedule would be again from October 16, 2024 to this time, June 30, 2026, it would be $21 an hour. From July 1, 2026 to June 30, 2027, it would be $22 an hour. From July 1, 27 to December 31, 2028, it would be $25 an hour.

And then from January 1, 2029, it would be adjusted for inflation each year. And those are just two of the examples. There’s definitely more. A few other things we wanted to note is that certain covered employers may qualify for a waiver in the form of a 12 month delay in schedule of the healthcare minimum wage requirements. In order to obtain that waiver, a covered healthcare facility must demonstrate at the time of the waiver application that’s submitted that it meets certain criteria. And that includes providing financial documents and a declaration verifying the contents of the documents contained in the waiver requests are true and correct. Another thing to keep in mind is that the minimum wage increase impacts salaried workers. To qualify as an exempt employee for wage and hour purposes, the salaried employee has to receive a salary of at least 1 1/2 times the new healthcare worker minimum wage or two times the state minimum wage, whichever is greater, and then of course meet other specific duty requirements. The third thing to keep in mind is if you’re covered by the new law as an employer, you have to post a notice to employees of that change in minimum wage.

We’ll include below a link to the supplement as well as the California Department of Industrial Relations FAQ on the new health care worker minimum wage for resources. The fourth thing you want to keep in mind is you have the health care worker minimum wage increase. How does that impact with a local minimum wage law? And really with that is you want to go with the higher number, right? So if a city or a county has a higher general minimum wage, the covered healthcare facility must pay the higher minimum wage. Lastly, this is really just a brief overview of the minimum wage increase. It’s important to work with your employment lawyer to ensure compliance and make sure to, you know, review and revise any policies as needed.

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• FAQ: Health Care Worker Minimum Wage Frequently Asked Questions (As of November 12, 2024, Last Updated by the DIR in October 2024)
  
• Supplement: California Minimum Wage MW-2023
  

Jacqueline Simonovich:

Thanks, Nikki. And that’s it for now. Thank you for joining us on this episode of CEN. And you can continue to find our video series and podcasts through the lelawblog.com or on the Weintraub Tobin YouTube channel. We look forward to reconnecting with the next edition of California Employment News.