Minimum Wage-a Trap for the Unwary

As most of you know, the state is increasing the minimum wage, over a series of steps, to $15 per hour. Under the state law the rate of implementation on a particular business
depends on the size of that business. Take a look at the chart, below, and you’ll see the calendar as it applies to your business.

But this new law has created a situation where lawyers thrive. That situation is commonly called confusion. With the state setting minimum standards, and over 30 cities and
counties in California setting more rigorous ones, many folks are at a loss as to how certain aspects of the new laws apply to them.

For instance, employees who work in the city of Santa Clarita for companies with fewer, than 26 employees won’t see a bump to $10.50 per hour until January 2018. But what
happens if the Santa Clarita-based employer sends its workers to do a job in either the city of Los Angeles or an unincorporated part of the county?

That’s where the confusion begins, big-time. Both the city and county of Los Angeles have rules that say if someone works at least two hours in a week in their jurisdiction the
employee is entitled to whatever is the then current minimum wage rate for the city or county.

What does that mean? We’ll create a fictional employer and employee. Root It Out is a plumber based in the city of Santa Clarita with 30 employees. Let’s say that Root sent
Fred Jones, one of its minimum wage workers, to do repairs in Stevenson Ranch for two weeks in July. During that two-week period, Fred worked 10 hours one week in
Stevenson Ranch and four hours the next week. All the other time, Fred did jobs in the city of Santa Clarita. So, what is Fred’s hourly rate during those two weeks?

Because Root has more than 25 employees and Fred did the work in an unincorporated part of the county of Los Angeles (also known as Stevenson Ranch), Root must pay Fred
$10.50 per hour for the 14 hours he worked in Stevenson Ranch. But for the other hours worked within the city, Fred makes only $10 per hour.

What about if Root sent Fred to the Bed, Bath & Beyond store on the Old Road to get supplies for a job in Santa Clarita? Does Root have to pay Fred anything more just
because he went to a store in the unincorporated area? The answer (which you won’t like) is, it depends. It depends on how long, during a week period, Fred is in the county. If he
goes back to the BB&B store five times in a week and spends a total of two hours and five minutes doing that, then Root owes him $10.50 per hour. If it was less than two
hours, then the state rate applies.

There are a host of other ways employers can get into trouble with this jumble of laws. Add to that the fact that both the city and the county of Los Angeles have added
departments to enforce these new laws, and you can see how employers may feel they have a target on their back. ©

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