San Francisco’s new minimum wage law will go into effect on July 1, 2016 at $13 per hour. This hike represents a “doubling” of the current minimum wage in the area. The change will also mean that the new maximum income to qualify as legally exempt in San Fransisco will be $54,000. The minimum wage increase is part of Proposition J, which passed in 2014 with over 76% of the vote.
Note to Employers: All California employers will be required to post the new minimum wage requirement notices citing the new $13 per hour as of July 1, 2016.
Mayor Ed Lee led the charge on Proposition J, referring to the ballot as a compromise between both labor interests and business interests. (The labor coalition originally supported efforts to enact a more expedited increase in the minimum wage in the area). Proposition J designates the following incremental increases to minimum wage:
· $12.25 per hour by May 1st, 2015
· $13 per hour by July 1, 2016
· $14 per hour by July 2017
· $15 per hour by July 2018
The end goal of $15 per hour would provide minimum wage employees with a base salary of $31,000 annually for full time work in San Francisco. Previous to this legislation, the highest minimum wage rate in California was $10.74 per hour.
The July 1, 2016 increase is just one part of the decision to increase the minimum wage to $15 per hour by 2020. The bill increasing the minimum wage designates gradual increases over time with increases after 2020 to be tied to inflation. San Francisco is joined by several other cities in the plan to gradually increase the minimum wage to $15 per hour. Other cities using similar plans include Seattle and D.C. Recent legislation is also addressing the minimum wage for restaurant workers. For instance, the tipped minimum wage in D.C. is currently $2.77, but will be gradually increased to $5 by 2020.