California Wage Orders: What They Are and Why Employers Should Care - Manneliasem
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California Wage Orders: What They Are and Why Employers Should Care

The California Industrial Welfare Commission has 17 wage orders that apply to different employers based on their industry or occupation.  Although other than minimum wage, these wage orders have not been updated since 2001, they provide specific rules regarding a wide variety of employment compliance issues, such as overtime, expense reimbursements, uniforms, and suitable seating requirements.

The following provides a list of the key wage orders:

Minimum Wage
On January 1, 2022, California’s statewide minimum wage increased to $15.00 ($14.00 for employers with 25 employees or less).  A statewide minimum of $15.00 for all businesses was scheduled to go into effect on January 1, 2023.  However, as a result of rates of inflation of over 7%, a further statutory increase has been triggered and the statewide minimum wage will now increase to $15.50 on January 1, 2023.

California employers are also subject to several local minimum wage ordinances that are higher than the state minimum wage.  Many of these will increase this summer.

Starting July 1, 2022, Los Angeles will raise their minimum wage(s) to:

Locality  Current Minimum Wage New Minimum Wage
Los Angeles City $15.00 $16.04
Los Angeles County $15.00 $15.96

Overtime and Exemptions
The wage orders generally set forth that eight hours constitutes a day’s worth of work.  Each wage order includes daily and weekly overtime provisions that lay out the rate of overtime pay for employees who work more than eight hours in a day or forty hours in a week. In some orders, this section also sets forth requirements for an employer to implement an alternative workweek schedule.

The wage orders also lay out those categories of employees “exempted” from overtime pay.  These categories are called exemptions and most wage orders contain at least three: the professional exemption, the executive exemption, and the administrative exemption.  Each exemption contains distinct factors a position must pass to be considered exempt, such as minimum salary requirements and whether the employee is able to regularly exercise their discretion and independent judgment as part of their job.

Employees who fall into these exemptions are not subject to certain parts of the wage orders, including the minimum wage, overtime pay, and meal period and rest break requirements. It is important when reviewing an exemption to verify what parts of the order the exemption apply.

Meal and Rest Periods
The wage orders restate the requirements for meal periods set forth in Labor Code 512. The wage orders are the basis for rest period requirements for employees. Under several of the wage orders, employers are required to provide 10-minute paid rest periods per 4 hours or a major fraction thereof.

Posting Requirement
Under the wage orders, employers are required to keep a copy of applicable orders posted in an area frequented by employees where it may be easily read during the workday. Where the location of work makes posting impractical, every employer shall keep a copy of the order and make it available upon request. Employers who are not familiar with the wage orders may want to review applicable industry orders and ensure they are either posted or available as soon as possible.

If you have questions about California wage order compliance or related issues, contact an employment attorney.

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