California Minimum Wage Now $8.00

January 11th, 2008 Posted by Amelia

The California Industrial Welfare Commission sets the state’s minimum wage, and as of January 1, 2008, California’s state minimum wage jumped 50 cents to $8.00 per hour.

The increase is the result of a two-step process that began in 2006.

 Under pressure from the Democrats to raise the state minimum wage, Governor Arnold Schwarzenegger agreed to bump the minimum by 75 cents from $6.75 to $7.50 on January 1, 2007, and to add an additional bump of 50 cents to $8.00 on January 1, 2008.

The increase in 2007 was the first raise in the California minimum wage since 2002.

In February of 1998, the California minimum wage was on par with the federal minimum of $5.15. In March of 1998, the rate rose to $5.75, then to $6.25 in 2001, and then to $6.75 in 2002.

A minimum wage of $8.00 per hour may seem generous, but California has the highest cost of living and some of the highest real estate prices in the country.

As a matter of fact, California’s minimum wage is not the highest in the nation. Previous to the January 1, 2008 increase, both Oregon and Washington had higher state minimum wages at $7.80 and $7.93 per hour, respectively. These two states also raised their minimums on January 1, 2008. Oregon’s rate jumped 15 cents to $7.95 per hour, and Washington’s increase of 14 cents brought its rate to $8.07 per hour.

Washington now holds the questionable honor of having the highest state minimum wage in the United States.

Like Washington and Oregon, several states have established their own state-mandated minimum wage rates. Other states enacted rates to echo the federal minimum wage. On July 24, 2008, the federal minimum wage will increase, meaning that several more states will raise their minimum wage rates as well.

These increases, both in California’s minimum wage and in the federal minimum wage, will require California employers to update their labor law posters. Legally, an employer who doesn’t display the updated posters can be fined.

The year 2008 has already experienced several changes in state minimum wage laws, and is slated to see several more.

On New Years Day, 2008, Arizona, California, Colorado, Delaware, Florida, Iowa, Massachusetts, Missouri, Montana, New Mexico, Ohio, Oregon, Vermont and Washington, fourteen states in all, enacted raises in their state minimum wage rate.

On July 1, 2008, five more states will follow suit. Michigan and Illinois will each raise its state minimum wage by twenty-five cents. Michigan’s will go from $7.15 to $7.40 per hour. Illinois’s will rise from $7.50to $7.75.

Kentucky and West Virginia, will add seventy cents to their minimum wage rates, resulting in new rates of $6.55 per hour and $7.25 per hour, respectively. Pennsylvania workers will enjoy a 90 cent per hour raise to their minimum wage rate, giving them a new minimum of $7.15 per hour.

Later in July, Utah, Oklahoma and a number of other states will establish higher minimum wage rates, too. These states have enacted laws which tie their minimum wage raises to the federal minimum wage.

On July 24, 2008, the federal minimum wage rate will increase from $5.85 to $6.55 per hour.

President George W. Bush signed the increase into law on May 24, 2006 as part of the Fair Minimum Wage Act of 2007. This Act established a three-tier system to increase the federal minimum wage. The bump on July 24, 2008 is the second step of the system.

Whenever a change occurs in any labor law, employers must update their labor law posters or face the possibility of a fine. Companies are required to display these posters in prominent spots in the employee work area, and to update for both state and federal law changes. Businesses seeking up to date information can visit www.laborlawcenter.com.

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Posted in California, Employment Laws, Minimum Wage, Wage and Hour

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