Amended in Senate March 11, 2015

Senate Bill No. 3

Introduced by Senators Leno and Leyva

(Principal coauthor: Senator De León)

begin insert

(Coauthors: Senators Hancock and McGuire)

end insert begin insert

(Coauthors: Assembly Members Gonzalez, McCarty, Mark Stone, and Ting)

end insert

December 1, 2014

An act to amend Section 1182.12 of the Labor Code, relating to wages.

LEGISLATIVE COUNSEL’S DIGEST

SB 3, as amended, Leno. Minimum wage: adjustment.

Existing law begin insert provides that it is the continuing duty of the Industrial Welfare Commission to ascertain the wages paid to all employees in this state, to ascertain the hours and conditions of labor and employment in the various occupations, trades, and industries in which employees are employed in this state, and to investigate the health, safety, and welfare of those employees. Existing law establishes the Division of Labor Standards Enforcement in the Department of Industrial Relations for the enforcement of labor laws, including minimum wage fixed by statute and the wage orders of the Industrial Welfare Commission. Existing law end insert requires that, on and after July 1, 2014, the minimum wage for all industries be not less than $9 per hour. Existing law further increases the minimum wage, on and after January 1, 2016, to not less than $10 per hour.

This bill would increase the minimum wage, on and after January 1, 2016, to not less than $11 per hour, begin insert and end insert on and after July 1, 2017, to not less than $13 per hour. The bill would begin delete require end delete begin insert require, end insert begin insert commencing January 1, 2019, end insert the annual automatic adjustment of the minimum begin delete wage, commencing January 1, 2019, end delete begin insert wage end insert to maintain employee purchasing power diminished by the rate of inflation during the previous year. The adjustment would be calculated using the California Consumer Price Index, as specified. The bill would prohibit the begin delete Industrial Welfare Commission (IWC) end delete begin insert commission end insert from begin delete adjusting end delete begin insert reducing end insert the minimum wage begin delete downward end delete and from adjusting the minimum wage if the average percentage of inflation for the previous year was negative. The bill would require the begin delete IWC end delete begin insert Division of Labor Standards Enforcement end insert to publicize the automatically adjusted minimum wage.

The bill would provide that its provisions not be construed to preclude an increase in the minimum wage by the begin delete IWC end delete begin insert commission end insert to an amount greater than the formula would provide, to result in a reduction in the minimum wage, or to preclude or supersede an increase of the minimum wage begin insert by any local government or tribal government end insert that is greater than the state minimum begin delete wage by any local government or tribal government. end delete begin insert wage. end insert

The bill would apply to all industries, including public and private employment.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 1182.12 of the Labor Code is amended
to read:

1182.12.  

(a) Notwithstanding any other provision of this part,
on and after July 1, 2014, the minimum wage for all industries
shall be not less than nine dollars ($9) per hour, on and after
January 1, 2016, the minimum wage for all industries shall be not
less than eleven dollars ($11) per hour, and on and after July 1,
2017, the minimum wage for all industries shall be not less than
thirteen dollars ($13) per hour.

(b) (1) Except as provided in paragraph (3), begin insert commencing on
January 1, 2019, end insert the minimum wage shall be automatically
adjusted on January 1 of each begin delete year, commencing on January 1,
2019, end delete begin insert year end insert to maintain employee purchasing power diminished
by the rate of inflation that occurred during the previous year.

(2) The minimum wage adjustment shall be made by multiplying
the minimum wage in effect on December 31 of the previous year
by the percentage rate of inflation that occurred during that year,
and by adding the product to the wage in effect during that year.
The resulting total shall be rounded off to the nearest five cents
($0.05). The begin delete Industrial Welfare Commission end delete begin insert Division of Labor
Standards Enforcement end insert shall publicize the automatically adjusted
minimum wage.

(3) The Industrial Welfare Commission shall not adjust the
minimum wage pursuant to this subdivision if the average
percentage of inflation for the previous year was negative.

(4) For purposes of this subdivision:

(A) “Percentage rate of inflation” means the percentage rate of
inflation specified in the California Consumer Price Index for All
Urban Consumers, as published by the Department of Industrial
Relations, Office of Policy, Research and Legislation, or its
successor index.

(B) “Previous year” means the 12-month period that ends on
August 31 of the calendar year prior to the adjustment.

(c) The Industrial Welfare Commission shall not reduce the
minimum wage prescribed by this section.

(d) This section shall not be construed to preclude an increase
of the minimum wage by the Industrial Welfare Commission to
an amount that is greater than the rate calculated pursuant to
subdivision (b) or to preclude or supersede an increase of the
minimum wage begin insert by any local government or tribal government end insert that
is greater than the state minimum begin delete wage by any local government
or tribal government. end delete begin insert wage. end insert

(e) This section applies to all industries, including public and
private employment.