Santa Monica, CA Approves Minimum Wage Increase, New Paid Sick Leave Requirements

APPLIES TO

All Santa Monica, CA Employers

EFFECTIVE

July 1, 2016

QUESTIONS?

Contact HR On-Call

(888) 378-2456

Update:  The implementation of Santa Monica’s paid sick leave was later delayed until January 1, 2017. Read more about the delay here.
Beginning July 1, 2016, the City of Santa Monica will increase minimum wage for employers of 26 or more employees to $10.50 an hour.  Wages are set to increase annually through July 1, 2020, ultimately reaching $15.00 an hour.  The ordinance allows employers of less than 26 to be phased in a year later, with the first wage increase to $10.50 effective July 1, 2017.

This ordinance also includes a separate wage rate for hotel workers, beginning at $13.25 an hour on July 1, 2016, with additional provisions on the distribution of service charges such as automatic gratuity. On July 1, 2022 and each year thereafter, the Santa Monica minimum wage will increase based upon the Consumer Price Index.  The adjusted rates will be announced each January 1st and go into effect July 1st of the same year.

The second component of the ordinance adds paid sick leave (“PSL”) regulations to employers that are more generous than California’s PSL law in certain respects.  Larger employers must provide at least 72 hours of accrued PSL; smaller employers, 40 hours.  Unlike the state-wide PSL law, there is no annual accrual or usage limit placed on accrued sick leave.  Santa Monica employees hired after the effective date begin to accrue PSL on their 90th day of employment, which is less generous than the CA law (accrual begins immediately upon employment, but cannot be used until the 90th day of employment).  Furthermore, Santa Monica’s PSL does not expressly permit frontloading of paid sick time.

Given these few but key areas of difference from CA’s PSL law, Santa Monica employers should carefully review their paid sick leave policies to ensure that their employees receive the most generous benefit as determined by state and local regulations.

 

Action Items:

  1. Read the minimum wage and paid sick leave proposal online here.
  2. Review current paid time off, paid sick leave or collective bargaining agreements, policies and procedures for compliance with the new law.
  3. Contact ManagEase at (888) 230-3231 for assistance in implementing or revising a paid sick leave policy and employee handbooks.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.

© 2016 ManagEase, Incorporated.

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